News

The new Chancellor’s first speech

15/07/2024

The Chancellor has promised to take immediate action to fix the foundations of the economy, rebuild Britain and make every part of the country​ better off. In her first speech as Chancellor, Rachel Reeves pledged to leaders of some of the UK’s pioneering industries to build growth on strong and secure foundations built on stability,

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Labour win landslide election result

11/07/2024

As had been widely predicted, the results at the polls have seen the Labour Party back in power after 14 years in opposition. Labour have swept into power with their second-largest majority whilst the Conservative Party have had their worst ever result in terms of the number of seats won. We should expect Labour to fulfil their election

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Inheritance and tax

11/07/2024

As a general rule, an individual who inherits property, money or shares is not liable to pay tax on the inheritance. This is because any Inheritance Tax (IHT) due should be paid out of the deceased’s estate before any cash or assets are distributed to the heirs. However, the recipient is liable to income tax on any profit earned after the

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Company filing obligations

11/07/2024

It is important that anyone responsible for the accounts and tax filing regime for private limited companies is aware of their obligations. After the end of its financial year, a private limited company must prepare full annual accounts and a company tax return. The deadline for filing the first set of accounts with Companies House is 21

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Restarting a dormant company

11/07/2024

HMRC must be informed when a non-trading or dormant company restarts trading and becomes active for Corporation Tax purposes. Companies can use HMRC Online Services to supply the relevant information. When a company has previously traded and then stops it would normally be considered as dormant. A company can stay dormant indefinitely,

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Business VAT responsibilities

11/07/2024

The taxable turnover threshold that determines whether businesses should be registered for VAT is currently £90,000. Businesses with turnover below this level can also apply for a voluntary VAT registration. Businesses charge VAT on their sales. This is known as output VAT and the sales are referred to as outputs. Similarly, VAT will be

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Are mega sized marshmallows zero-rated?

11/07/2024

In the UK most basic food stuffs are zero rated. However, the definition of 'basic' is not straightforward and many of the foods are zero rated as a result of historical legislation dating back to the introduction of VAT in 1973. Famously, cakes are zero rated but not all biscuits are zero rated. However, biscuits wholly or partially

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New government

08/07/2024

Our new government, and in particular, Rachel Reeves, the new Chancellor, will be responsible for raising the funds that our new government requires to finance its activities. The government has already declared that it will not increase Income Tax, National Insurance or VAT and government borrowing has to remain within tight limits. In

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Exit plans

08/07/2024

Exit can be seen as quitting, especially if the exit discussed is your business interests. But actually, business exit planning is an essential part of general business planning. In some respects, it is the most important aspect of business development planning as it shines a light on the timing and value you can expect when you

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CGT Incorporation Relief

04/07/2024

Where a taxpayer owns a business as a sole trader or in partnership, a capital gain will be deemed to arise if the business is converted into a company by reference to the market value of the business assets including goodwill. This could give rise to a chargeable gain based on the difference between the market value of the assets and

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What your tax code means

04/07/2024

The letters in your tax code signify your entitlement (or not) to the annual tax free personal allowance. The tax codes are updated annually and help employers work out how much tax to deduct from an employee’s pay packet. The basic personal allowance for the current (and next) tax year is £12,570. The corresponding tax code for an

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Income Tax in Scotland

04/07/2024

The Scottish rate of income tax (SRIT) is payable on the non-savings and non-dividend income of those defined as Scottish taxpayers. The definition of a Scottish taxpayer is based on whether the taxpayer has a 'close connection' with Scotland or elsewhere in the UK. The liability to SRIT is not based on nationalist identity, location of

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Late night taxi for an employee

04/07/2024

There is no specific requirement for employers to provide employees with transport home. Nevertheless, an employer has a duty of care to their employees, which means that they should take all steps which are reasonably possible to ensure their health, safety and wellbeing. Ensuring that an employee gets safely home during unsocial

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Claim full expensing or 50% FYA

04/07/2024

Full expensing allows for a 100% first-year capital allowance for qualifying plant and machinery assets and came into effect last April. To qualify for full expensing, expenditure must be incurred on the provision of “main rate” plant or machinery. Full expensing is only available to companies subject to Corporation Tax.

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Statutory redundancy pay

04/07/2024

If you have been in the same job for two years or more and are made redundant you will usually be entitled to redundancy money. The legal minimum that you are entitled to receive is known as ‘statutory redundancy pay’. There are exceptions where you are not entitled to statutory redundancy pay, for example, if your employer offers to keep

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Translation

01/07/2024

If you receive documents from overseas customers or suppliers and you need to translate text into English, have you used Google Translate? It’s a free, but incredibly powerful facility. You can select to translate: Individual blocks of text that you add to view in alternate languages. Images with text. Documents. And really

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Extracting profits from a small, limited company

01/07/2024

It is pretty much universally accepted that shareholders (usually directors) of small companies take out their remuneration as a small salary - a salary pitched high enough to secure NIC benefits but not high enough to that employee NIC contributions are payable - and any balance as dividends. Unless directors have the need for

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Tax Diary August/September 2024

01/07/2024

1 August 2024 - Due date for corporation tax due for the year ended 31 October 2023. 19 August 2024 - PAYE and NIC deductions due for month ended 5 August 2024. (If you pay your tax electronically the due date is 22 August 2024) 19 August 2024 - Filing deadline for the CIS300 monthly return for the month ended 5 August 2024. 19 August

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Are you claiming the marriage allowance

27/06/2024

The marriage allowance can be claimed by married couples and those in a civil partnership and where a spouse or civil partner does not pay tax or does not pay tax above the basic rate threshold for Income Tax (i.e., one of the couples must currently earn less than the £12,570 personal allowance for 2024-25). The allowance works by

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Check your State Pension forecast

27/06/2024

The enhanced Check Your State Pension forecast service is now available online. The service can be found on GOV.UK at the following webpage https://www.gov.uk/check-state-pension. The new digital service is a joint service by HM Revenue and Customs (HMRC) and the Department for Work and Pensions (DWP). It has been enhanced to include a

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Finding your National Insurance number

27/06/2024

If you have lost or forgotten your National Insurance number there are a number of ways to locate it. Firstly, you could try and locate the number on paperwork such as your tax return, payslip or P60. You can also use your personal tax account or the HMRC App to find your National Insurance number. If your National Insurance number still

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Check employment status for tax

27/06/2024

The Check Employment Status for Tax (CEST) tool can be used to help ascertain if a worker should be classified as employed or self-employed for tax purposes in both the private and public sectors. The service provides HMRC’s view as to whether IR35 legislation applies to a particular engagement and whether a worker should pay tax through

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How to check a UK VAT number

27/06/2024

The online service for checking a UK VAT number is available at: www.gov.uk/check-uk-vat-number. This service can be used to check: if a UK VAT registration number is valid; and the name and address of the business the number is registered to. The service also allows UK taxpayers to obtain a certificate to prove that they checked

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Private rental deposits

27/06/2024

There are special rules under the Tenancy Deposit Scheme that limits the amount of deposit that landlords in England can request. There are also further limitations on what landlords and agents can charge tenants. If you are renting a residential property you may have to pay a deposit before you move in. The maximum deposit your

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What is a group company structure?

25/06/2024

A group is formed when one company has control of, owns, a number of subsidiary companies. A group is different to an arrangement where an individual owns a number of companies personally. In this case the companies would be called associated or sister companies. What are the advantages of a group structure? One useful reason for

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Reclaiming pre-trading VAT

20/06/2024

There are special rules that determine the recoverability of VAT incurred before a business registered for VAT. This type of VAT is known as pre-registration input VAT. There are different rules for the supply of goods and services, but VAT can only be reclaimed if the pre-registration expenses relate to the supply of taxable goods or

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Post cessation transactions

20/06/2024

Tax relief may be available for post-cessation expenses of a trade. To be an allowable post-cessation expense the trade must have ceased and the expense must have been deductible in calculating the trading profits. This means that the expense still has to meet the wholly and exclusively test and be revenue, not capital, expenditure. The

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Tax relief for training costs

20/06/2024

If you are self-employed it is important to know if an expense is tax allowable. Any allowable costs can be used to reduce your taxable profit. As a general rule you can claim for items that you would normally use for less than 2 years as allowable expenses such as stationery and other office sundries as well as rent, rates, power and

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Tax and employee share schemes

20/06/2024

There are a number of government approved share schemes which offer various incentives to employees. The rules of the schemes vary but they are all designed to help incentivise employees by giving them the opportunity to invest in their employer's business. This in turn helps businesses retain and recruit key staff by offering tax

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Connected persons for tax purposes

20/06/2024

The definition of a connected person for tax purposes varies. A statutory definition of “connected persons” for Capital Gains Tax purposes is set out in Section 286 of the Taxation of Chargeable Gains Act (TCGA) 1992. The legislation states: " A person is connected with an individual if that person is the individual’s

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