SDLT surcharge for non-residents
Stamp duty land tax (SDLT) applies to purchases of most land and buildings in England and Northern Ireland. Wales and Scotland impose different land taxes.
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Fourth SEISS grant
Self-employed individuals will be able to apply for the fourth SEISS grant from late April if they submitted their tax return for 2019-20 by midnight on 2 March 2021 (it was due by 31 January 2021).
2021/22 Tax Efficient Salary for Company Directors
Each year company directors have a decision to make to determine whether they need to change their monthly salary for tax efficiency purposes. When it comes to a tax efficient salary for the 2021/22 tax year there are three national insurance thresholds to be aware of:
MAKE THE MOST OF YOUR ISA ALLOWANCE
As a UK resident over 18, you will receive an annual ISA allowance of £20,000 (for the 20/21 tax year). This means you can pay a maximum of £20,000 into your ISA to allow it to grow without paying tax on any income derived from it.
Budget 2021 Corporation tax complexity
The Chancellor announced that taxes would have to rise, but not quite yet, as all tax rates except for VAT are frozen for 2021-22.
Changes to Self Assessment Late Payment Tax Penalty
HMRC has announced that self assessment customers will not be charged a the initial 5% late payment penalty if they pay their tax bill or make a time to pay arrangement by 1st April 2021. The deadline to submit the tax return and pay any tax owed was 31st January 2021. Interest will continue to…
Budget 2021 Summary Report
The Chancellor delivered his budget yesterday. You can download our simple guide to the budget here.
New VAT rules for Construction Sector from 1st March
From 1st March 2021 new rules for VAT in the construction sector are set to be introduced. These rules are commonly known as domestic reverse charge for construction services. These changes were first announced in 2017 and were due to be implemented originally in 2019 but deferred, first to October 2020 and then again to 1st…
What is a Confirmation Statement?
As a company director, not only is there a responsibility to submit accounts to HMRC and Companies House but also to submit an annual statement called the confirmation statement. Previously this was known as the annual return.
Property Versus Pension
We have often heard the phrase, ‘my property is my pension’. People tend to have different plans for retirement. As life expectancy has continually increased for the UK population over the past decades, it follows that the thought of ensuring a decent quality of life post retirement is considered.
Company Losses
Over the past 9 months we’ve seen firsthand the number of companies suffering losses on business operations due to the effects of coronavirus.
TAX DEADLINE – 31 JANUARY 2021
The most pressing tax deadline for now is the main filing and payment deadline, of 31 January.
Home expenses to claim when you’re self-employed FAQs
12 common questions people ask about expenses they can claim when running a business from home. What is an allowable expense? Won’t my allowable expenses be similar to other businesses similar to mine? What factors are taken into account when apportioning an expense? Are heating, lighting and power costs allowable? Are telephone and broadband costs…
Investing in shares: personally or through a company?
Making Money from Shares Share investments can derive income in two ways. Firstly, income in the form of dividends and secondly from their increase in capital value that can be realised later on. It’s possible to invest directly and hold the shares personally, but what are the implications of using a company and is there…
VAT on international services
The rate of VAT on services supplied to non-business customers in other EU countries normally depends on where the supplier is located or, for services related to land, where the land is located.
Redundancy pay
Most businesses have had a very difficult year due to the pandemic. Unfortunately, some have had to make major changes including letting staff go and restructuring their businesses resulting in redundancies. Making staff redundant is hard for any small business as employees can become as close as family.
Changes afoot for Capital Gains Tax?
In July 2020 the Chancellor of the Exchequer asked the Office of Tax Simplification (“OTS”) to carry out a wide-ranging review of Capital Gains Tax (CGT). The OTS has made a number of significant recommendations. Many of the recommendations are not new and many of them seem to involve reintroducing concepts in CGT that have…
VAT rate cut for hospitality sector
The hospitality and attractions sectors are enjoying a special 5% VAT rate which applies from 15 July 2020 to 12 January 2021.
Report your sale in 30 days
A new online system for paying and declaring CGT within 30 days of completion for sales of residential property was introduced from 6 April 2020. CGT online applies to all sales of UK homes where exchange and completion occurred after 5 April 2020. Sellers who are not tax-resident in the UK must report all UK…
What is Gross Payment Status CIS?
Under the Construction Industry Scheme there are essentially 3 payment statuses. A payment status dictates how a subcontractor is paid;
SDLT holiday, time to invest in property?
One of the key measures announced by the Chancellor in July was the reduction in Stamp Duty Land Tax (SDLT) on residential property. The purpose of the reduction is to boost the housing market and support the construction industry.
Annual Functions for Employees
With Coronavirus restrictions in place throughout the country, this year a number of business will be unable to offer their normal staff Christmas party. Are businesses able to utilise the £150.00 exemption at another point in the year?
Covid-19: Lockdown II Update
It is almost certain as a reader of this blog you will have made some further changes to your daily routine as we head into our second national lock-down which is scheduled to end 2nd December – although this may be extended dependent on the situation at the time. Pubs, restaurants, gyms, non-essential shops and places…
Job Support Scheme or Job Retention Scheme?
As the nation has entered a second national lock-down, the Government has introduced further support packages and amended existing schemes. Amongst the changes include changes to the Job Retention Scheme (furlough scheme) which was due to end on 31st October. The close proximity of the announcement and the original end date of the JRS has caused…
Bounce Back Loan Scheme Extended
The Bounce Back Loan Scheme (BBLS) has been extended to 31st January 2021 which is welcome news.
Set your finances up for success with smarter accounting. Start by making savings with your first post Covid self assessment
For business owners, 2020 has been a year of unexpected and unprecedented challenges. Whilst we are all experiencing difficulties we’d never have anticipated before March, some things never change…self assessment season is just around the corner again. The pandemic has put an almighty strain on small business owners’ livelihoods, wrecking havoc on both their business…
Why Write a Business Plan?
A business plan is an essential document for any new business. It is the route map of how an idea manifests itself into a viable business. It is also an essential document if you need to raise finance for your business.
Self-Employed Income Support Scheme (SEISS) Extended
On 23 September 2020, the Chancellor announced that self-employed individuals and members of partnerships who are eligible for the SEISS, and who are actively continuing to trade but are experiencing reduced demand due to Covid-19, will be eligible for a further SEISS grant to provide support over the winter months.
Restructuring Insights – CORONAVIRUS INSIGHTS from an Insolvency Practitioner
As we rapidly head towards an exit from lockdown and a phasing out of the Job Retention Scheme (Furlough) my phone has started to ring as clients and contacts anticipate cash flow issues and have concerns about their responsibilities as business owners or directors.
VAT on Termination Payments
HMRC have recently updated guidance on changes to VAT on early termination fees and compensation payments. Anyone who charges customers to withdraw from agreements to supply goods or services.
A Pro Headshot Attracts Great Success
As we ease ourselves out of lockdown, it’s never been more vital to make sure your website, marketing material and business headshot stands out from the crowd.
Card tax payments are to incur a charge
Currently, if you make a tax payment to HMRC you are only charged a fee if paying using a business credit card. Payments by personal credit cards are not permitted.
Lifetime ISA Withdrawal charge reduced
In order to help investors access to cash during the pandemic, the Government has reduced the withdrawal charge from 25% to 20%. This is temporary and applies from 6th March 2020 to 5th April 2021 and the investor can withdraw all funds if required.
Covid19: Tax Hikes and what you should do?
Tax – Tax has a long history in the UK, going back to the 13th century. Income tax was the first tax levied on people’s earnings in 1799.
Financial Considerations Summary – Post Pandemic
With the health and economic impact of coronavirus, it’s a challenging time for many. Above all, it’s important to keep yourself safe.
Accounting for VAT under the ‘Eat Out to Help Out’ Scheme
The Eat Out to Help Out scheme starts from 3rd August with a view to revive the struggling leisure and hospitality industry amid covid-19.
What is a car allowance?
You’ve probably heard of the company car and some its associated tax issues. However, you may not have of a car allowance.
Beware tax scams
HMRC regularly warn taxpayers to be alert to fraudsters purporting to be from HMRC. It was recently published that in the last year they deactivated more than 20,000 fake HMRC websites, an increase of 29% on the previous year.
Landlords! When does the cash basis apply?
Read this blog post to find out more information on when cash basis applies.
SEISS Grant – Remember, it is taxable!
Read this blog post to find out more information on the self-employed income support scheme (SEISS).
Stress Testing and Scenario Analysis
The global pandemic has ensured we will never forget 2020! Of particular importance to business is to revisit your strategic plan.
Time to Act Now
According to the Law Society the number of people seeking to write new wills has increased by 30% due to the pandemic.The current situation is causing angst among people, understandably.
Tax Breaks for Cyclists
Due to the current pandemic many people have been cycling to work to avoid public transport and keep safe.
Rules relaxed on home office expenditure
The government has introduced a temporary exemption in regards to the purchase of office equipment.
VAT for digital publications scrapped
Find out why VAT for digital publications has been scrapped in the most recent Budget.
Covid:19 Income Tax Deferrals
Read this blog post to find out about income tax deferrals introduced to help businesses from the ongoing coronavirus pandemic.
Covid:19 VAT Deferrals
Read this blog post to find out what the Government is doing to help businesses from the ongoing coronavirus pandemic.
Company Cars – Time to Reconsider?
Company cars have been less popular over the years due to often creating a larger personal tax bill on employees than they save on the company’s corporation tax bill.
COVID-19 Relief for landlords?
The government has launched various different support measures across different sectors to help fight the pandemic financially to those who need it most. It is our view that more can still be done but that is a separate conversation.
Tax Tips before the end of the tax year
The current tax year, 2019/20 is coming to an end on 5th April 2020. You’d be forgiven for being distracted during the current pandemic but it is important to ensure sight is not lost on important tax reliefs which can’t be carried forward.
The law on employment contracts is about to undergo its biggest overhaul for many years
So what do you need to know in regards to the upcoming change on employment contracts? Read on to find out more
Covid-19: Things to consider before applying for a mortgage payment holiday
So what should you consider before applying for a mortgage payment holiday. We have all the tips for you in this latest blog.
Budget 2020 keeps Entrepreneurs’ Relief and IR35 delay hopes killed off
So what did Chancellor Rishi Sunak revealed in the Budget for 2020? Read this blog to find out more.
Reclaiming VAT on entertainment of foreign customers
Businesses can reclaim VAT on costs incurred for their business provided they will be used in making VATable supplies (i.e. sales that include VAT).
Cash is King
You have probably heard the phrase ‘Cash is King’. In business, this is true. Despite this, cash flow is an area of business where many struggle to manage effectively causing business-owners to spend many hours chasing – all unbillable time.
Trivial Benefits
HMRC have pretty stringent criteria on what they classify as ‘trivial’. Once a benefit satisfies four conditions it can be considered trivial. Read on to find out more.
VAT Avoidance & Business Splitting
It is common for many businesses to wish to avoid the requirement to be VAT registered. As the law currently stands a business making taxable supplies must register for VAT if sales exceed £85,000 over a 12 month period.
Reducing Payments on Account
The first instalment of your self-assessment tax bill for the 18/19 tax year is due on 31 January 2020.
Tax Scams at Record High
The number of scams involving bogus HMRC communications is increasing as the self-assessment payment deadline approaches. This blog highlights warning signs to be wary of. If unsure, speak to your accountant.
Paying your January Tax Payment
The tax return deadline is on 31 January, meaning that you have less than a month to finalise your tax affairs for the year ended 5 April 2019. It also means you have just a few days to settle your tax payment.
Tax Relief for Teachers
Teachers often spend their own money on things needed to do their job. What they can claim back against their tax bill often causes confusion. This blog aims to clear things up.
Tick Tock – Help to Buy ISAs
Find out how opening a Help-to-Buy ISA before 30th November 2019 can help you if you are looking to get on the property ladder.
Deferring CGT
Capital Gains Tax (CGT) is a tax applicable where you sell an asset for more than it cost you. Read on to find out more.
Furnished Holiday Lets
As landlords you may often have heard of certain advantageous tax treatment of a furnished holiday let (FHL). What is a furnished holiday let and how can you potentially benefit?
The Starting Rate of Savings
A lot of our clients are not aware of the starting rate of savings. To find out more read this short blog post.
Reclaiming VAT on business cars
We often get asked about whether or not VAT can be reclaimed on the purchase of a car for business. In almost all cases, the answer to this is no. This post highlights the exceptions and practical points where a reclaim may be successful.
Claiming costs of repairs before letting out your investment property
An important distinction must be made between two different types of expenditure; capital and revenue.
Reducing the risk of PPR relief
Many people assume that selling your main home automatically exempt from any capital gains tax. In some cases, this isn’t the case and getting this wrong can be very expensive.
Reliefs available to homeowners to minimise your tax bill on sale
Read this post to find out the details on reliefs that are available to homeowners to minimise your tax bill on sale of your property.
Dividend Waivers – Use Tax Planning
A dividend waiver is the right to a waive a dividend payment and can be a useful tax planning tool under the right circumstances.
Should You Get Down on One Knee?
Find out how Inheritance Tax is effected by whether you are married or not. Read on to find out more.
IR35 – Small Company Exemption
IR35 rules for the private sector are changing in terms of implementation from April 2020. As things stand currently, small companies will be excluded.
Should you consider incorporation?
Businesses can operate under various different structures and there may be various reasons for choosing a particular one.
Exempt transfers for IHT
Some transfers of value are exempt from IHT and this article aims to highlight these. Read on to find out more.
Is it a reimbursement or disbursement?
Understanding the difference between a reimbursement and disbursement is imperative to get the VAT treatment correct.
Steps to reduce IHT
Read on to find out how you can reduce the amount of inheritance tax you are charged.
Reclaiming VAT on decorating the workplace
Find out if your business can claim VAT on the decoration of your workplace.
Don’t leave reclaiming the extra SDLT too late
Find out how you can reclaim the extra Stamp Duty Land Tax you have paid.
Is the cost of a medical procedure a taxable benefit?
Is an injury impacting your ability to work? Read on to find out whether the costs of medical procedures are taxable benefits.
New rules proposal for rent a room relief
From April 2019 there has been a significant restriction to rent-a-room relief. Read on to find out more.
New Payslip Regulations
New rules for payslips were introduced from the 6th April 2019. There are two specific main changes being implemented. Read on to find out more on how these new rules may impact you.
HMRC are getting smarter, so should landlords!
HMRC launched the “Connect” system to achieve their aim of becoming the leading tax collector in the world. Read on to find out more.
Residential Buy to Let – Should you transfer it to a Limited Company?
If you are reading this as a residential landlord you’ll be acutely aware that HMRC is reducing tax relief on interest you pay on loans used to buy properties to let.
Selling your business in a tax efficient manner
Owners of family run businesses who are looking to perhaps retire or do something different should consider different options for the most tax efficient route.
Pension Contributions – Invest Now
Pension contributions are not a hugely popular way to save, but they do have their benefits such as generous up-front tax breaks. Read on to find out more.
Increased flexibility from a property investment LLP
Due to the increased attacks on landlords by successive Budgets, the use of companies to hold properties has become increasingly common.
A harsher Capital Gains Tax regime from April 2020? What is it?
From April 2020 there is more bad news afoot for landlords, as if there hasn’t been enough already in the past few years.
Do all landlords need to complete a tax return?
The level of profit generated by a rental portfolio is what determines whether a landlord has to complete a tax return. Read on to find out HMRC’s guidance on the topic.
Considering selling your buy to let property? It may be worth doing this before 5th April 2020
A couple of measures which should be well known by now, were introduced in the budget last year which will adversely affect landlords and taxes payable. Read on to find out more.
What is Form 17 and how is it applied?
The Form 17 Income Tax Declaration Form is used by married and civil partnership couples who want to declare unequal shares in a jointly owned property.
Help ease your VAT cash flow
This piece looks at the solutions available to the age old problem of cash flow and how they can be used to alleviate the burden on your business.
Employers; further changes to workplace pensions
A workplace pension is a way of saving for your retirement that’s arranged by your employer. Here are some key changes employers should be aware of.
Utilising pension allowance from prior years
Making contributions to a pension scheme remains an incentivised method to save for retirement. This post discusses how you can utilise pension allowance from previous years.
Charities losing money – When to claim Gift Aid?
Charities are missing out on up to £600m as a third of donations do not add Gift Aid when they could have done. Read on to find out more.
Latest Advisory Rates have been published
The advisory fuel rates have been updated which are applicable from December 2018, read on to find out more.
Running a Limited company after state pension age?
The state pension was introduced in 1948. This is important as it is the earliest date you can claim your state pension and it depends on your date of birth.
New VAT Penalty System under MTD
The existing penalty system is due to change from 2020. Read on to find out more about what you need to do to avoid penalties now or in the future.
Winding up your company? What is the most tax efficient way to do so?
If your business life cycle has come to an end or perhaps you are retiring you may decide to wind up your company. Our latest article looks at steps you can take to increase tax efficiency.
Can a pension payment turn a profit into a loss?
Pension contributions are an effective way to mitigate tax bills and plan for your retirement. Here we answer the question ‘Can a pension payment turn a profit into a loss?’ Read on to find out more.
Parking fines – can my business reclaim the VAT?
Fines and penalties are not a tax deductible expenses, meaning the business will not receive tax deduction when incurring them. Read on to find out whether or not your business can reclaim VAT on parking fines.
When is a dividend taxable?
Director/shareholders can at times find themselves in a situation where they have used business cash to fund personal purchases. It is important to record such transactions adequately in the company books to avoid potential issues with HMRC.
Suggestion scheme awards. What are they and are they tax free?
This post discusses the main talking points of suggestion scheme awards and where employees and employers both stand in relevance to them. Read on to find out how it may affect you.
New Tax & NI Bands
The 2018 Budget increased the tax and NI bands from April 2019. They won’t be increased again until April 2021. Therefore, the resulting tax saving has the appearance of being more generous than it actually is as there are changes to NI contributions to factor in.
A Company Limited by Guarantee; what is it?
Here we discuss what the meaning of a company limited by guarantee is and what type of businesses operate in this structure.
VAT & Vouchers – An Update
Find out about the changes due from January 2019 on the three different types of vouchers and how it could effect your business.
Top tips for completing your Tax Return
Although it is always better to plan ahead, it still isn’t too late for those yet to complete their return. Some useful tax saving tips are outlined in this post.
How to win Making Tax Digital (MTD) exemption
From April 2019, the majority of small businesses must now have fully digital record keeping. This piece discusses the key points of ‘Making Tax Digital’ and how it will affect taxpayers.
Budget 2018: Rent-a-room relief plans shelved
The government has dropped plans to introduce a shared occupancy test to qualify for rent-a-room tax relief, confirmed in the Budget 2018 delivered by the Chancellor, Philip Hammond.
Budget 2018 – Capital gains tax: Letting relief
Following the 2018 Budget there are several key changes to letting relief which are due to be implemented from April 2020.
Cross-Discipline Networking, Is It For You?
Have a read of this brilliant piece by Saleem A. Jalil and the benefits of cross-discipline networking.
Tipping Waiters
Under recent proposals from the Government all tips received from customers will have to be passed on to the staff and businesses will not be able to take deductions.
Changes to Rent-a-room relief
Here we discuss the changes to regulations to a taxpayer of renting all or part of their home and why they are being implemented.
Employed or self-employed – which one are you?
The status of your employment goes a long way in dictating your tax obligations and the relevant expenses and losses that are legally deductible.
How ISAs and pensions can save you tax
Two of the best ways to keep your hard earned money in your pocket are through the use of ISAs and pension accounts.
Class 2 National Insurance Contributions
Plans to abolish Class 2 national insurances contributions have been cancelled as the government announces that it will remain in place.
The Challenges with paying for childcare
Recent Government introduction of Tax Free Childcare has led to parents assessing their current arrangements. There is still a lot of confusion regarding which option may be best suited to individual circumstances.
Medical Check-ups and treatment, tax free?
Medical check-ups and treatment can become exempt from tax and NI in certain circumstances. It is essential to know and follow the regulations of when this may be possible.
Filing Deadlines for Limited Companies
Private limited companies have filing deadlines for accounts and tax returns. It is important for these deadlines to be met to avoid penalties being levied.
Islamic Finance – Interest Cost Treatment for Buy to Let
Islamic financial products continue to gain popularity and this poses an important question for landlords who have used such or are considering such products to fund their buy to let portfolio.
Research and Development – Tax Relief
Research and Development (R&D) tax relief and credits give a tax advantage to both small and medium sized enterprises (SME’s) and large companies undertaking qualifying activities, namely advancements in science or technology.
Are the costs of an eye test tax deductible?
For many of us, spending a considerable amount of time in front of computer screens is part of our daily routine. When you use a Visual Display Unit (VDU) required by your role, the company (employer) can provide eye tests, contact lenses or glasses tax and NIC free subject to certain conditions and in line…
Tax Relief for Employees
It isn’t so commonly known that employees are able to claim tax relief on work related expenses. These are expenses that are incurred for work purposes and are not reimbursed by the employer. To get tax relief on these expenses a claim must be submitted to HMRC. This can be done using form P87.
Non-Taxable Payments and Benefits
The following is a summary of ten common expenses payments and benefits that are non-taxable as a benefit in kind. 1. Late-night taxis. The cost of a late-night taxi provided by an employer to an employee for a journey from home to work will be exempt if the employee is required to work later than usual…
Tax Relief on Clothing
A very common question for most business owners is whether or not they can claim tax relief on clothing. The basic principle for an expense to be allowed is that it must be incurred wholly and exclusively for business, i.e. for work purposes. HMRC’s Stand Point HMRC’s view follows on from a basic principle established…
Tax planning – Why it is so important to start now
If you’re still recovering from submitting your tax return for the previous financial year and are dreading the prospect of starting the process again for 2017/18, you are not alone. It may therefore be even further down your priority list to start planning for the current tax year, 2018/19. To make the most of all…
5 Important Changes for Landlords in 2018
A lot is changing for landlords in 2018, some of which is already underway. In this short report we have highlighted some of the important points to be aware of.
The 18/19 tax year – what has changed?
We are now in the new 2018/19 tax year and a number of changes have been made to tax thresholds and rules which affect contractors, freelancers and small business owners. It is important to keep up with changes in order to manage your finances and remain tax efficient. To help, we’ve put together a quick…
EIS and SEIS – Benefits and Eligibility
The Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) are both part of the UK government’s initiative to encourage investment in small and medium businesses. The idea is to help SMEs raise funds to grow the business by offering investors tax relief on the finance they provide.
Using Alphabet Shares in a SME Business
Alphabet shares refer to shares issued by a limited company that have different rights attached to them as set out in the company’s articles of terms of issue. The shares are listed by a letter (‘A’, ‘B’ etc) and hence called alphabet shares. Businesses issue this type of share for various reasons.
Planning ahead for the fall in the dividend allowance
Dividend tax rules changed from 6th April 2016 onwards. All taxpayers, regardless of the rate at which they pay tax are entitled to a dividend allowance. From 6th April 2016 this was £5,000 and is set to be decreased to just £2,000 from 6th April 2018.
First Time Buyers Relief on SDLT – Tips and Traps
Over the past 20 years property prices have significantly and continually increased, often making it hard for first time buyers to get on the property ladder.
Marriage Allowance Update
It is now possible to transfer 10% of your personal allowance to your spouse or civil partner (£1,185 during the 2018/19 tax year).
Paying your January tax bill
As a contractor or freelancer, you may have used the festive break to think about the next steps you will take to improve your business. We hope you also used the holiday to think about your self-assessment tax return as the deadline is looming.
Do you have a 2018 Business Plan?
Ensuring your business is moving in the right direction is incredibly important for all business owners. Particularly so for small businesses where the owner may take on multiple roles. Which means it can be very easy to focus on the ‘here and now’ and not so much on the future.
2018 Outlook for small businesses and freelancers
Small businesses have been called the back-bone of the UK economy. And, from figures released by the Federation of Small Business (FSB), it looks like this is true. What does 2018 hold for Small Businesses, including freelancers?
Claiming tax relief on Christmas parties and gifts
The festive season is here, which means it’s Christmas party time! What can be better than celebrating your successes and hard work with your colleagues? Well, knowing that you may be able to claim tax relief on your Christmas party and gifts could be an extra treat for you and your small business this year.
Key points for Small Businesses from the Autumn Budget
Philip Hammond’s first Autumn Budget started with a sequence of humorous statements, including referring to Theresa May’s coughing pout at the Conservative Conference. However, he soon got down to business and delivered his hour-long Budget speech, announcing changes that will impact on contractors, freelancers and small businesses. Here is our summary.
If you don’t know your tax figure yet, why not?
If you are self-employed, it is your responsibility to calculate your tax figure and report this to HMRC by the given deadline. Some reasons why people delay finalising their taxes include: perceived lack of time lack of knowledge not sure where to start weren’t aware there was a deadline lost their log-in details for the…
Is self-assessment ending?
As you may have heard, the assessment known as ‘simple assessment’ has arrived and with it HMRC’s plan to cut the number of tax returns it issues. Some people are asking if this is the end of self-assessment…in short, no it isn’t. So, what is changing?
Tax breaks for LISA
The Lifetime Individual Savings Account or LISA, as it is often shortened to, was launched in April 2017. Aimed to encourage young people (specifically those aged 18-40 years old) to simultaneously save for their first home and retirement as both are major concerns for the younger generation.
Getting the VAT return right
Value Added Tax, VAT for short, is levied on the sale of nearly all goods and services by businesses. VAT for goods and services is charged at differing levels. The standard VAT rate of 20% is charged on most goods and services. In principle working out how much VAT to pay HMRC seems simple, but it…
4 common misunderstandings about tax on property investment
With interest rates low and house prices steadily rising, investing in property is often thought of as the ideal money making opportunity – and an easy, safe bet. It is no wonder then that if you have a little bit of money to invest you are lured by the thought of a regular income, or…
Can you still make money from an ISA?
It is likely you have noticed that interest rates on savings are at an all-time low. Your Individual Savings Account (ISA) is probably earning you as little interest as your other savings (and general bank) accounts, and there does not seem to be much chance of the base rate increasing significantly any time soon. However, there…
How to improve your financial performance
Whatever the aims and goals of small businesses and freelancers, turnover and profitability are usually top of the agenda. Keeping an eye on the finances is what keeps the business going. Like many people, numbers may not be your strength, which is where accountancy support is invaluable.
What you need to know for tax when you start self-employment
Starting self-employment is a big step. No longer will you have the luxury of a regular salary and you will also have new responsibilities when it comes to reporting your tax affairs to HMRC. It need not be daunting though as help is available. Here in a checklist of the most important things to know…
Stamp duty on second homes
Purchasing your first home, or moving into a new property, is an exciting and joyous time. It is also a big financial commitment. Getting expert financial advice could save you money as well as time and stress. There are many things to consider when purchasing a property, even more so if you are purchasing a second…
10 reasons why Xero is good for your business
Xero is one of many cloud accounting software packages, however we think it is one of the best. It not only allows you to save time and therefore focus on your core business operations. It also allows you to make much more educated business decisions. Find out 10 great reasons why Xero is good for…
It’s time to send your accounting records
It may be that paying your July tax payment on account has spurred you into thinking about tax in general, or maybe you have already been sent a few reminders from your accountant about getting this year’s tax return records to them. But yes, it is that time of year again where the 5 April…
Cloud Accounting Software: is it now a necessity?
Cloud accounting software is talked about a lot these days, but is it just an advantage or is it a necessity, for your small business? It may be that you are comfortable with your own system, whether that is Excel or another desktop application. However, with the advancement of technology, the increased risk of security…
Save Tax by Making Charitable Donations
Business owners make charitable donations as a way to reduce their tax bill, whilst contributing to their charity of choice. Terms and conditions apply though so it is important to understand the tax rules and regulations before making your donation, to ensure you maximise your tax position. Find out about how it works for sole…
Taxes for Photographers
Tax and accounting are often not welcome tasks for photographers, who invariably prefer spending their time being creative. It often becomes the last task on the list and subsequently there can be some pressure around deadlines if things are left until the last minute. Fortunately, help is available and technology allows for an easier ride…
SELF ASSESSMENT: How to Pay Your July Payment on Account
The self-assessment tax system requires you to pay a tax payment on account in July. It is an estimate based on last year’s tax and the payment goes towards your next tax bill in January 2018. Unless your tax is minimal then a payment on account will be required and if it is, it is…
Making Tax Digital Delayed – What This Means For Small Businesses
Making Tax Digital Making Tax Digital (MTD) has been talked about a lot in recent months, even as part of the Election manifestos. This government initiative to get 100% of tax filing into a digital format was due to take effect from 2018. However, recent announcements confirm that it will be at least a year before…
Election Manifestos – Points on Tax
The 2017 general election, called just a matter of weeks ago by Conservative party leader Teresa May, is just days away. The polls are suggesting that the initial Tories lead has diminished as the gap closes, making the result unpredictable. If there isn’t a clear victory then a hung parliament will certainly require compromise and…
Should I change my director’s salary this tax year?
With the change from one tax year to the next comes a range of different tax rates, allowances and thresholds that can change the way in which you manage your taxes. A company director is typically paid a salary from the limited company, which is calculated very specifically to maximise tax-efficiency. Should you therefore increase…
My friend told me to incorporate. Is it still worth it for tax?
It is natural for friends and family to want the best for you, and quite often they take the opportunity to give advice based on their own circumstances. Once upon a time incorporation was, more often than not, the sensible option for a business once it’s profits reached a certain level. However, in recent years…
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Mileage Claim versus Expenses Claim – which is best for tax?
If you use a car for legitimate business journeys then you are able to claim related motor expenses against your business profits, which will help reduce your overall tax bill. There are a couple of methods for doing this. One is to claim back the business related percentage of your total costs. The other is…
Main Residence Allowance means less Inheritance Tax
The Main Residence Allowance has been talked about for a while now, but it is only from April 2017 that it is now available. This new tax allowance comes in the form of a separate nil-rate band relating to the value of the family home, or main residence. It effectively means that the value of…
Advice Allowance for Pension holders
A new government initiative is now available to ensure that pension holders have access to financial advice regarding their retirement. Research shows that when taking professional advice around pension planning you are more likely to save more and have a larger pot to draw down when you finish work.
30 hours free childcare for eligible parents
The government are soon to double the amount of free childcare available to eligible families. The childcare entitlement applies for children aged three and four, as well as most disadvantaged two-year olds. This initiative is to incentivise parents to return to work, or increase their working hours and not feel the pressure of having to…
Buy-To-Let Tax Relief Is Changing Soon
From April 2017, tax law surrounding buy-to-let property is changing. If you own a rental property it is important you understand fully how these changes will affect your tax position. Tax relief on mortgage interest will be reduced from next week, on a tapered approach until 2020.
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5 Tax Tips For New Freelancers
Working as a freelancer has many advantages, including, being able to choose your own working hours, being your own boss and wearing comfortable clothes to your home office. However, there are some downsides too, one of which is dealing with your own tax under self-assessment. The good news is though that there is lots of…
Budget 2017 – Summary For Contractors and Small Business Owners
The Budget 2017 was the first announcement delivered by the Chancellor, Phillip Hammond. On the whole there were no real surprises, as expected. A few things though will affect contractors, freelancers and small business owners, both self-employed and operating through a limited company. Here we summarise.
2017 Spring Budget Date
The 2017 Spring Budget is set for Wednesday 8 March. This will in fact be the last Budget announcement to take place in the Spring, as from now on Budgets will feature in the Autumn. The purpose of the Budget announcement is to deliver the financial and economic position of the UK, based on information…
IR35 Changes for Public Sector – Is the Private Sector Next?
From April 2017, there will be a significant change to the way in which Personal Service Companies (PSC’s) in the public sector are taxed. Currently, there are over 250,000 PSC’s in Britain, many operating in sectors such as healthcare and IT. Because PSC’s are often structured with just a sole director and shareholder, working often…
Just 2 Months To Go! Year End Tax Planning for Small Businesses
It must feel like no sooner have you paid the last tax bill, there is now talk of more tax. Indeed, this is the case, as the current tax year is coming to close again on 5 April 2017, which means there is less than two months to take any important action that could reduce…
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Self Assessment: How to Pay Your January Tax Payment
The tax return deadline is on 31 January, meaning that you have less than a week to finalise your tax affairs for the year ended 5 April 2016. It also means you have just a few days to settle your tax payment.
Self Assessment: Could you Reduce your Payments on Account?
It is likely that your tax bill due at the end of this month is made up of two components. The first part is your tax liability based on profits for the year ended 5 April 2016. The other is the first “Payment-on-Account” for the tax year ended 5th April 2017. Could there be the…
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Relevant Life Insurance Cover is Tax Deductible
It isn’t common knowledge that a specific type of life insurance cover, called Relevant Life insurance, is deductible for tax relief within the framework of a limited company. However, it is a valuable piece of advice, as savings of up to 52% can be made by switching policy.
New Year. New SMART Goals.
January is a great month for renewed focus and motivation. So why not take the opportunity to plan ahead and set new goals? With the busy festive season behind us, and half of the winter (hopefully) out of the way, there is now an open space to think about what you want to achieve this…
Property highlights from the Autumn Statement
The Autumn Statement had, as expected, a key focus on what is commonly referred to as a “housing crisis”. Lack of affordable homes continues to be an issue, along with the inflated house prices that make it virtually impossible for first-time buyers to get the break they need. Landlords are still very much in the…
Tis the Season to be Jolly: What Tax Relief Can you Claim on Parties and Gifts?
December is the month for Christmas gatherings, and the giving and receiving of gifts, to celebrate the festive season. Most business owners want to also find out how they can squeeze a little more from their generosity when they are organising festive events or treats for their team. It is therefore important to understand the…
Flat Rate VAT Changes for UK Contractors following Autumn Statement
The Chancellor’s first Autumn Statement has not been a particularly good one for contractors, unfortunately. The main change that will impact your company and finances is that to the VAT Flat Rate Scheme. Make sure you understand fully how the new legislation will affect you. We are here to help answer your questions.
UK Contractors Face Uncertain Times As IR35 Rules Tighten Following Autumn Statement
The Autumn Statement announcement last week delivered some destructive news to the UK contractor community, particularly those working in the public sector. There had been discussions around the topic of contractor tax in the Budget, however, the concerns have now materialised as the government push ahead with their plans. How does this affect you?
Autumn Statement 2016 – Key Points of Interest
The Autumn Statement announcment was delivered with the usual positive tone and promises of a brighter future for the UK. It was, however, the usual mixed bag of new measures; some good, some not so good, for UK contractors, freelancers and small businesses. Read our summary here.
Calculating Flat Rate VAT for Contractors
Not all contractors know when starting out, that you can actually earn extra money from using the VAT Flat Rate Scheme. It works in the way that you charge your customer the standard rate of VAT at 20 percent, but you are only required to pay HMRC a lower, flat rate; 14.5 percent for IT…
The Importance of Working with an Independent Financial Adviser
Whether you are a contractor or locum, freelancer or small business owner, you will know the importance of having good professional contacts that you can trust and rely on. As you are often wearing many hats already, it is essential that you are able to connect with the right people who can give you the…
Register for Flat Rate VAT
If you are a contractor or freelancer, or own a small business, you may be liable for VAT. If your income reaches the threshold of £83,000 in any given tax year then you are required by law to register. The VAT Flat Rate Scheme for small businesses often works out a good option, as you…
9 Tax Free Benefits for Limited Company Directors
Being a director of a company means that you are also an employee. This means that the same rules apply to you as would if you were working for any other employer. It just so happens that you are, broadly speaking, the employer and the employee. There are therefore non-cash benefits that you can receive…
Donate with Gift Aid for Tax Benefits
As a UK tax payer, there are benefits of donating to registered charities and community amateur sports clubs (CASCs). For every £1 you donate, the charity can claim an extra 25 pence from the government, effectively increasing the donation by 25%. In addition certain taxpayers can get tax relief – how does it work?
Making Tax Digital – HMRC vision for 2020
Making Tax Digital (MTD) is a 5 year project for HMRC to make the tax reporting, filing and the management of UK tax, one of the most sophisticated and digitally-focused in the world. The plans are already underway and changes will be phased in between 2018 and 2020. How could this affect your tax?
Online Accounting Software to Save Time & Tax
In the technological world we now live, our expectations of communication and connectibility have increased signifiacntly. As you know, there are very few things that we are unable to access from anywhere in the world. All we need is a wi-fi connection and a mobile phone, tablet or laptop.
Inheritance Tax Update – New rules to save tax
Inheritance Tax (IHT) planning can save your loved ones thousands of pounds in tax following your death. To be effective though, actions need to be taken in advance, so it is essential to keep up-to-date with the tax legislation surrounding IHT so you can ensure yo
Brexit and how it will affect your finances
Brexit has been very much the topic of conversation for the past three months and whether you voted for the UK to Leave or Remain in the EU, is now water under the bridge. We are all now part of a waiting game to see how things unravel in the coming weeks, months a
Capital Gains Tax – cuts in rates opens new opportunities
The rates of Capital Gains Tax (CGT) were cut in the March 2016 Budget, opening up potential opportunities for investors to diversify how they invest their money, and save tax in the process. Read more about how to calculate Capital Gains Tax and what reliefs may be available to you.
Should I increase my director’s salary this tax year?
For directors of limited companies it is important to calculate the most tax efficient way to take out money from the company for personal use. Ensuring you have taken advice on the best mix of salary versus dividends, means more net take home pay for you.
Annual Return replaced by Confirmation Statement
The annual return is being replaced from June 2016 under the Small Business, Enterprise and Employment Act 2015. In its place a Confirmation Statement will need to be filed annually.
Claiming tax relief on maintenance of buy-to-let property
As a follow up to our Buy-to-Let Property Investment Update here we look at how landlords can still claim for maintenance despite the Wear & Tear Allowance being abolished from April 2016. If you own a buy-to-let property it is more important than ever to be able to claim the maximum legitimate expenses against your rental…
Buy-to-let property investment update
With many of our contractor clients also choosing to invest in buy-to-let property, AJN have prepared a Buy-to-Let Update providing details around five key changing factors, and summarising both the current challenges, as well as the remaining opportunities for each.
Contractor tax – Important dates and rates for this tax year
The new tax year commenced on 6 April 2016, so this month it’s important to familiarise yourself with what has changed and how you can benefit from the new contractor tax opportunities. AJN Accountants, as specialist contractor accountants, can provide bespoke tax planning for the 16/17 tax year to ensure you minimise your tax and…
Take home more this year by saving tax
It’s only natural to want to take home at least a little more income year on year, and “pay-rises” of whatever kind are always welcome when contracts are renegotiated or the business profit exceeds that of the prior year. However, independently of increasing your income, fine tuning your financial position by ensuring you are maximising…
LISA – a flexible way for under forties to save
The Budget 2016 announced details of a new style ISA, called the Lifetime ISA (or LISA) that will be available from April 2017 for all 18 to 40 year olds. It will be a flexible way for young people to save towards their first home and their retirement, at the same time, and the government are…
The 2016 Budget
Today’s Budget announcement did not bring too many surprises, or big changes, relevant to contractors and freelancers. Much of the speculation around pensions did not come to light this time around, and the bill is still underway regarding Elective Resolutions, and winding up limited companies tax-effectively.
Possible changes to pension tax relief
Pension tax relief is one of the most valuable tax breaks available and every individual who is a UK resident, under age 75, can benefit. The government encourages this saving as a means to support retirement planning in a country with a growing older population, and subsequently pays part of your contributions in the form of…
Contractors and freelancers face pension choices
Pensions are a particular area of tax planning that is ever-changing. In 2015, a couple of key announcements were made that will affect pension planning for contractors and freelancers in 2016, including a decrease in the Lifetime Allowance, and, a tapering of the annual pension allowance for high earners.
Is limited company still the best route for tax?
As all contractors will now be aware, from April 2016, dividends will be taxed differently, and the limited company “owner director” will highly likely pay more tax than they do currently. The question many contractors and freelancers are asking is, “does it still pay to be limited, taking everything into account?”.
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Contractors with cash reserves. Act now. Save tax
Along with the changes to contractor dividend tax rules, that come into force from April 2016, the government are making plans to restrict any loopholes that could be used to avoid this extra tax, by targeting Member’s Voluntary Liquidations (MVL’s). Contractors need to be aware of the new rules to MVL’s and there’s a small…
Ways to pay your January tax bill
As a contractor, you may or may not have tax to pay by 31 January. Do you know the ways to pay your tax? Make sure you know the best way to pay your tax bill so you don’t miss the deadline and incur any charges or interest.
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It’s the season to be…filing your tax
Whilst the festivities are in full swing in December, and everyone’s minds are on having a few days off over the Christmas and New Year period, it can’t be ignored that the festive season is also, the tax season.
Considerations for avoiding the dividend tax
The new dividend tax as announced in July’s Budget, will affect almost all contractors and freelancers trading from within a limited company. A question we are getting asked by many contractors is, are there ways to avoid this?
The new dividend rules will affect contractor tax
The July 2015 Budget announced changes to the tax rules on dividends that will inevitably affect most contractors and freelancers that trade using a limited company. It is important to understand the current contractor dividend tax system in detail, the changes that are on the horizon, as well as consider the options available that may help…
Current tax regime on Buy to Lets
Changes are on the horizon for buy-to-let property owners. It is important to understand these. Separately, the interest on any mortgage or loan taken to buy, improve or maintain the property, is fully deductible.
HMRC Debt Recovery Powers
HMRC is set to gain powers to collect tax debts directly from taxpayers’ bank accounts under the Direct Recovery of Debts (DRD) rules, Finance Act 2015. This is likely to be late September or early October 2015.
Salaries versus Dividends
One key question asked by contractors and freelancers when trading as a limited company, is, “how is best to extract income from the company?”. It is important to understand the differences between drawing money as salary and drawing money as dividends, and the tax treatment of each.
Wear and tear allowance to be replaced with a new relief
Landlords can currently claim a wear and tear allowance when they rent out furnished residential property to cover the cost of replacing furnishings. This is soon to change – find out more.
Tax benefits of company motorbikes
It’s good news! For a limited company, the entire cost of a motorbike purchase qualifies for capital allowances; for other motor vehicles the same doesn’t necessarily apply, so it could be an option worth considering.
Save tax by transferring shares to your children
Even though transferring shares to your children is caught by “anti-avoidance rules”, which taxes the parents on any dividends paid to the children, it is an area that is still worth looking into for possible tax savings.
Can I claim a Phone as a company expense?
HMRC expenses rules state that the company can provide staff with ONE mobile phone for business purposes, which is exempt from tax on the individual as a benefit-in-kind (BIK) and a legitimate allowable expense against corporation tax. Rules apply though.
Car ownership FAQ’s
The question of how best to structure the use of a car which is used partly for business and partly for private use, is common. Whilst each situation is specific to your individual needs, there are some general rules that apply and, that are worth knowing.
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