Latest Business Tax

In the Budget earlier this year the Chancellor announced that there would be a new rule aimed at stopping tax avoidance when a limited company is wound up and funds are distributed to the shareholders. Where certain conditions are met, the distribution will be treated as income in the hands of the shareholders rather than…

Contractors: Don’t pay too much flat rate VAT. Just three weeks ago it was reported that the VAT flat rate scheme guidance was flawed. The ATT had highlighted that HMRC’s practice was costing traders, as they were forced to pay more VAT to HMRC under the flat rate scheme than the law required. HMRC has…

HMRC: Roll-over on farm cottages. Are farm cottages owned by a farming company and occupied by farm workers business property for capital gains tax roll-over relief purposes? It was held in the case of Anderton v Lamb that property occupied by partners in a farming partnership were not. In order to qualify for relief, farm…

Annual Tax on Enveloped Dwellings (ATED): Threshold reduced. The ATED charge applies to companies which own residential properties. On 1 April 2016, the lower threshold will be reduced from £1 million to £500,000. This will mean that many more companies will be caught within the ATED rules. The deadline for submission of the 2016/17 forms,…

As the tax calculations below illustrate, based on the UK tax rates and thresholds for 2016/17 (ie applying the new dividend taxation rules), a limited company still results in a lower overall tax/NIC charge than a sole trader (allowing for the extra accountancy fees incurred through trading as a limited company), whilst profits are above…

Super Tax Reliefs: Claim both patent box and R&D relief? The answer to this question is yes and the combination of the two reliefs can be very valuable! We have a number of clients who are undertaking ongoing research and have already registered a patent on their earlier research. They are able to receive the…

Requests for Payment If you supply goods, the taxpoint for accounting for VAT on these sales is the sooner of: The raising of a tax invoice, or Receipt of payment. To delay this taxpoint, it will usually, therefore, be beneficial, prior to dispatching goods, to raise a “Request for Payment”,  “Application” or “Proforma Invoice” instead…

Motor Vehicle Garages and Furniture Retailers: Beware VAT Margin-Benchmarking Have you received a letter from HM Revenue and Customs headed “transparent benchmarks”?. Around 7,500 businesses engaged in the repair and maintenance of motor vehicles and in the retail sale of furniture are likely to receive these letters. The letters provide details of the anticipated relationships between…

UK Tops World League Table of Business Tax Competitiveness. In Accountant KPMG’s 7th annual survey of where in the world is it best for a business to be based, the UK has scored highly, beating its usual rivals. When businesses were asked to name their top 3 most attractive countries from a tax perspective, the answers ranked: 65% –…

Do I need to register for VAT? This is one of the many questions we hear from clients who have just started in business. The compulsory VAT registration threshold is currently £79,000. If you expect your annual turnover to exceed that threshold quickly, then you are probably best registering on day one. If not, and…