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Tip of the day

It’s a New Tax Year. So, What’s New Is that…

If your non-investment income is < £10,600, the first £5,000 of savings income is taxed at 0%! If you earn > £15,600 from a job, from self-employment, of pension or rental income, this may be of little relevance to you. If, however, you are a company owner and draw a low wage to keep out […]

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Removal of Tax Obstacle to Multiple Companies

Today is a big date in my calendar.  It is one I have been looking forward to for a number of years now.  1st April 2015 is when the main rate of corporation tax finds the same level as the small companies’ rate at 20%. The small companies’ rate is on profits under £1.5m and […]

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New Bankruptcy Threshold

Bankruptcy is no laughing matter, but its threat can be described as funny (peculiar). It is often used as part of a debt collection game.  The creditor can think it only needs to mention the word and the debtor will pay up. The rules of the game will be changing from 1st October 2015.  From that […]

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Tax Year-end Planning

The tax year ends on 5th April. I favour a strategy of continuous planning.  I do not just start when it comes to the end of the tax year.  I start when I know what the tax rates and bands are going to be and what my clients’ circumstances are.  What I do around now, is […]

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RTI Late Filing Penalties Start Here

Well, we have had quite a run-in. We can complain all we like about the system itself, but we can’t complain that HMRC haven’t given us enough time to get used to the real time information filing obligations for PAYE before levying penalties when we are late. As of 6th March 2015, late filing penalties […]

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Get Those Forms R85 Ready

From 6th April 2015, there is a new savings rate of income tax of 0% that applies to the first £5,000 of interest above the personal allowance. If you have total income of no more than £15,600, then you should pay no income tax on your bank or building society interest. Of course, banks take a lot […]

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HMRC Benchmarking

Long been a tool for the financially-savvy, even HMRC are at it, now. They have sophisticated data at their disposal and they are starting to use it to work out whether your reported net profit ratio is within their expectations for your trade sector. They will not tell us what these expectations are, but I […]

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Consider HMRC Offers of Help

HMRC are fond of offering to help. It is easy to be suspicious and pretend not to hear them. If you do end up getting caught out, please bear in mind that penalties will be greater if you had been offered help and refused to take it.

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Year-end Tax Planning – a green car?

If you are thinking of buying a car for your business and are interested in the 100% first year allowance available for eco-friendly cars, you would be well-advised to make your purchase by 31st March. Until then, the CO2 cut-off for the 100% fya is 95g/km. From 1st April, it is 75g/km. Your timing running […]

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List of National Minimum Wage Offenders Published

HMRC has just uploaded the latest list of employers who have been caught not paying the national minimum wage. An insight into HMRC’s tactics in this area are in this quote: “Naming and shaming gives a clear warning to employers who ignore the rules, that they will face reputational consequences as well as financial penalties .” […]

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New Advisory Fuel Rates

We are all very well aware, that while the fall in the price of oil is overall good, it is a bit of a double-edged sword. The latest downside is that HMRC have reduced the amount it will allow you to pay employees for the business cost of fuel they pay for in a company […]

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Useful Tribunal Guidance on Developers Claiming Private Residence Relief

A case has just emerged from Tribunal that tells us quite a bit about our chances of getting favourable tax treatment if we develop a house and live in and around it while doing the work.  Our chances are not good. The First Tier Tribunal agreed with HMRC that our hero was trading in the […]

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3 Days’ Grace on RTI Late Filing Penalties

HMRC have just issued a press release containing very little detail, but uttering the words “Employers will not incur penalties for delays of up to three days in filing PAYE information.” This is excellent news for everyone at the mercy of a system that requires a return to be made to HMRC on the same […]

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Yet Another Reason Not to Fear an Overdrawn Director’s Loan Account

There are tax reasons why you wouldn’t in principle want to borrow from your personal company. There is a 25% bond for your company to pay and there is income tax for you to pay personally on the deemed salary you are charged for having an interest-free loan from the company. I have previously posted […]

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HMRC Quote on Importance of Compliance

In a very recent release from HMRC I was interested to read “Our digital services will also give us access to more and better data about our customers, which will enhance further our compliance activities. We will be able to look at a customer record across all our tax regimes and previous tax periods, providing […]

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Penalty Ruling Puts Responsibility With Provider of Information for Return

A recent Tribunal case saw the taxpayer lose his appeal against a penalty. The case was about a beneficiary of an inheritance which had been under-declared for inheritance tax.  There had been a Swiss bank account that had been withheld from disclosure to the authorities. The beneficiary argued that the penalty should not stand because […]

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HMRC Use of Data to Catch Tax Cheats

This is a regular warning of mine. I always tell people there is no need to cheat, anyway.  Arguing instead that you can win at the tax game by getting a better coach to teach you new skills or to play the game for you. If you are to take the ‘easy’ way to a […]

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HMRC Have a Sense of Humour

‘Tis true. On this 31st January, there is very little around to make me laugh.  So, when I got an email alert that HMRC had just published an article entitled “HMRC’s top 5 tips for completing your tax return”, I just knew it had to be worth a look.  I was not disappointed. Very first […]

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Self Assessment Payments and Penalties – part 2

Yesterday, we looked at prioritising 28th February for the payment of tax under self assessment. Another priority that is important to have is that the 5% surcharge applies only to the balancing payment and not to your payment on account. So, if you are sat there with £10000 balancing payment to make + £5000 payment […]

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Self Assessment Payments and Penalties – part 1

As we get closer to the 31st January, everyone knows the situation with the filing of self assessment tax returns.  It is quite simple, one day late and it costs you £100. What is less straightforward, is the position on paying the tax that your return tells HMRC is due. Interest will always be charged […]

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New Self Assessment online chat service

HMRC have today announced their latest foray into the digital world. They are offering an “online chat service to customers with Self Assessment queries this January” How useful it will be is unclear, particularly as “staff will not have access to your account, so for detailed account queries you should call the Helpline as normal”. […]

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VAT Partial Exemption is the Accounting Student’s Enemy – It Could be Your Friend

It’s not very often HMRC get generous, but sometimes they have de minimises that tell us where rules apply in general, they will ignore their application where the amounts involved are not worth their while in worrying about. In principle, you cannot claim input VAT back when it is incurred in the pursuit of part of […]

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Rules on Personalised Car Registrations

This one is just for companies.  The tax rules for sole traders and partnerships are different. The taxes legislation considers that private plates are intangible assets.  It is not the plastic that you are paying for, it’s the right to use the number = intangible. Tax relief for companies on intangibles is given by way […]

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One For Anyone Borrowing From Your Own Company or For Everyone Who Needs to Know How Rules Work

Sometimes, tax planning is all about knowing the rules in their finer details. Take loans to directors, for example. The default method of calculation of taxable benefit is to take the balances at the beginning and end of tax year and divide by two to get the average.  The beginning and end dates change where […]

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HMRC Take Aim at Solicitors

HMRC have just announced another of their campaigns, this time just for solicitors. They are inviting brethren of the legal profession to come clean and declare taxable income that had previously been locked away in chambers. I have yet to hear what data HMRC hold that would encourage you to come forward.  Past campaigns have been triggered […]

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Bridging the Gap Between NI and Income Tax Thresholds – Part 3

Becoming a more interesting sport as each budget appears to be widening the divide.  Income tax is to kick in from £10,600 at April 2015 when national insurance will be payable on all earnings over £8,060.  So, a shareholder-director might want to be able to set his wage at £10,600 but he won’t want to be […]

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Bridging the Gap Between NI and Income Tax Thresholds – Part 2

Becoming a more interesting sport as each budget appears to be widening the divide.  Income tax is to kick in from £10,600 at April 2015 when national insurance will be payable on all earnings over £8,060.  So, a shareholder-director might want to be able to set his wage at £10,600 but he won’t want to be […]

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Bridging the Gap Between NI and Income Tax Thresholds – Part 1

Becoming a more interesting sport as each budget appears to be widening the divide.  Income tax is to kick in from £10,600 at April 2015 when national insurance will be payable on all earnings over £8,060.  So, a shareholder-director might want to be able to set his wage at £10,600 but he won’t want to be […]

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Hey George. What About NI?

So George Osborne is fanfaring another rise in the personal allowance. I’m fairly certain he had already told us it would go to £10,500 in 2015/16.  He now says we can count on £10,600 of income before we pay income tax. If that threshold is going up apace, then I wish they would add a […]

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Autumn Statement 2014 – Employers NI Exemption for Apprentices

Effective April 2016, employers will be excused from paying national insurance on apprentices under the age of 25. This is further good news for all of us who fear having lost generations as youth unemployment has been a problem for society for too long now. There isn’t actually a lot in this announcement, but its […]

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Autumn Statement 2014 – An Immediate Reaction

Was that it? I must have missed something.  Maybe I fell asleep. I will have to rely on reading up on all the documentary releases by the Treasury which very often contain stuff that failed to make the Chancellor’s speech. My first reaction is that there is very little there. George Osborne is a very political […]

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VAT on Giving to Staff

Now, we can’t blame our government for anything VAT, unless you are of a UKIP persuasion and blame them for being in the EU in the first place.  All VAT rules come from Brussels. In principle, where you provide a benefit to staff that is a taxable supply made by you to them.  Customs in […]

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New Advisory Fuel Rates

These are the rates you can pay employees for using a company car when they pay for fuel and that they should reimburse you for private miles when you pay for fuel. From 1st December, the rates have come down by 1p for petrol cars up to 1.4l and over 2l, and then for diesels […]

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Damning Audit of Auditors

I am no big fan of audits. Yes, some companies have to have them. Some companies, however, choose to have them done. The 2013 audit monitoring report compiled by the Institute of Chartered Accountants found just 19% of the audit files they inspected to be up to the standard of satisfactory. So, if you have […]

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The Font of All Tips

I loved this one when I read it.  Even if it is just for its quality of being at once bland and genius. If you are doing a large print run, and the cost of ink concerns you, then Which have done some ‘ground-breaking’ study on the effects of using different type fonts. Apparently, Times […]

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Don’t Land Yourself Filing Penalty on Paper Return

Self assessment tax returns filed on paper have a penalty filing deadline of 31st October. If you are anywhere near to being late, opt for online filing instead. There are no second chances.  You can’t be late on paper and then file online.  You still get a penalty.

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Tax Code Wrong? Don’t Hang on the Phone. Get Online

As part of their strategy of ridding themselves of human beings, HMRC have launched an online service through which you can alert them to problems with your tax code. Tell Google to search on the words “PAYE Coding Notice Query”, and you should find your way to the relevant section of hmrc.gov.uk. Ringing up is […]

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Another HMRC ‘Campaign’ / Amnesty

This time, it’s for businesses that accept card payments. HMRC have just launched another campaign, inviting those with previously un or under-declared tax to come forward and give themselves up. They say “HMRC has details of all credit and debit card payments to UK businesses. This information is used to identify individuals and businesses that […]

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Beware Tax Breaks on Low Emission Vehicles

From April 2015, HMRC are phasing out the exemption from company van benefits taxed on employees driving zero emission vans. So, if you have one of these, it ain’t going to be so good from next April. More relevant is the fact that once again, HMRC encourage you to go out and fill your fleet […]

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HMRC Allow You to Ignore Them

HMRC are fond of their ‘amnesties’.  At least, that’s what they call them.  They are not actually amnesties at all.  An amnesty would be for them to say that we can ignore their very existence.  Even if only for a day or two.  That there is this accountant’s fantasy. Well, they have made it part […]

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