By Katie Tax Advice 0 Comments

Is it time to review your will and think about the family home?

Now could be the time to review your will. Top of the to do list for many individuals is to make or update their will. Many think this is something to leave until later in life but it is important to get things in place once property is acquired or when children come along.

In the absence of a will there are statutory rules which dictate how your assets are distributed on death. Those statutory intestacy rules may not be tax efficient and you might to want to make specific provision in your Will for your unmarried partner or for the guardianship of your children.

Passing on the family home

One recent change that should be taken into consideration when drafting your Will is the additional Inheritance Tax (IHT) nil rate band for passing on the family home to direct descendants on death. We can work with your solicitor to make sure your Will is tax efficient.

Now that the additional relief is fully phased in it provides an extra £175,000 on top of to the normal £325,000 nil rate band.  Where the allowance is unused on the death of the first spouse, the unused allowance is available on the death of the surviving spouse, potentially allowing a married couple (or civil partners) to potentially pass on assets of up to £1 million without paying IHT.

This additional relief is, however, restricted if your assets exceed £2 million. The rules are fairly complicated but we can review your personal circumstances to ensure that you take advantage of all the relief that you are entitled to.

This relief is even available when you downsize to a smaller property.

For example, if a married couple currently live In a large house worth  £500,000 downsize to a flat worth £300,000, they could give away some of the proceeds during their lifetime and yet still benefit from inheritance tax relief based on the higher valued property.

They could even sell up completely and move into a rental property or a care home and still get the inheritance tax relief!

Need more information?

Do you need help to review your will? We offer a wide range of services which are unique to you and your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

Our fantastic team at A&C Chartered Accountants are here to help.

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    By Katie Business Advice • Tax Advice • Tax News 0 Comments

    Brexit: Accounting for import VAT On your VAT Return

    From 1 January 2021, you’ll need to make changes to how you complete your VAT Return if you’re a UK VAT-registered business and account for import VAT on your return for goods you import into: Great Britain (England, Scotland and Wales) from anywhere outside the UK Northern Ireland from outside the UK and EU.

    You’ll need details of the imports to be included in the return. This will include:

    • any customs entries you have made in your own record.
    •  copies of your monthly postponed import VAT statement, when available.
    Unless you have delayed your customs declaration, each statement will show the total import VAT postponed for the previous month. Your statements will become available to view in the first half of each month.
    Accounting for import VAT on your VAT Return means you’ll declare and recover import VAT on the same VAT Return, rather than having to pay it upfront and recover it later. The normal rules about what VAT can be reclaimed as input tax will apply. You can read more on the gov.uk website here.You can also use the Brexit checker here to get a personalised list of actions for you and your business.

    Need more information?

    We offer a wide range of services for companies who work with overseas customers. Our team of chartered accountants have a wealth of experience in a broad range of sectors and can help you with the Brexit transition. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

    Our fantastic team at A&C Chartered Accountants are here to help.

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      By Katie Business News • Tax Advice • Tax News 0 Comments

      Annual Investment Allowance

      £1 Million annual investment allowance extended 

      The Chancellor recently announced that the temporary increase in the Annual Investment Allowance (AIA) for expenditure on plant and machinery has been extended to 31 December 2021.

      The tax relief was originally scheduled to revert to just £200,000 from 1 January 2021, but that will now be delayed by twelve months.

      Remember that there is currently an additional 100% tax relief for the cost of buying a new car for the business where the CO2 emissions of the car are no more than 50g per kilometre. That threshold reduces to 0g from April 2021.

      Need more information?

      Do you need tax and annual investment allowance guidance? We offer a wide range of services which are unique to you and your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

      Our fantastic team at A&C Chartered Accountants are here to help.

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        By Katie Tax Advice • Tax News 0 Comments

        New VAT rules for construction sector starts 01.03.2021

        New VAT rules for the construction sector are finally due to come into effect this March which will impact on accounting for VAT for transactions. These new rules, which were originally scheduled to start back in October 2019, have already been delayed twice as there was a lack of awareness of the changes in the industry.

        The new “reverse charge” system of VAT accounting will affect sub- contractors supplying their services to main contractors in the construction sector.

        Under the new rules, supplies of standard or reduced-rated building services between VAT-registered businesses in the supply chain will not be invoiced in the normal way. Under the new reverse charge system, the sub-contractor will not show VAT on their invoice to the main contractor and will not account for output VAT.

        This is intended to ensure that VAT is correctly accounted for on supplies by sub-contractors, some of whom were allegedly not paying over the VAT charged to HMRC.

        The new reverse charge will apply to a wide range of services in the building trade, primarily those activities covered by the construction industry (CIS) payment rules. Note that normal VAT invoices will continue to be issued to domestic customers.

        Please contact us if you are likely to be affected by these changes and we can work with you to ensure you are ready for the new system when it starts. If you are a sub-contractor using the VAT flat rate scheme, it may be beneficial to leave that scheme as you may be entitled to a VAT refund on your expenses from 1 March 2021.

        Need more information?

        New VAT rules for the construction sector are finally due to come into effect this March which will impact on accounting for VAT for transactions. Do you need help with this? We offer a wide range of services for the construction sector. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

        Our fantastic team at A&C Chartered Accountants are here to help.

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          By Katie Business Advice • Tax Advice • Wealth Planning 0 Comments

          New years resolution to save tax with pension planning

          At this time of year we think about New Year’s resolutions and pension planning could be a great way. It is also a good time to start planning your tax affairs before the end of the tax year on 5th April.

          An obvious tax planning point would be to maximise your ISA allowances for the 2020/21 tax year (currently £20,000 each).

          You might also want to consider increasing your pension savings before 5 April 2021 as the unused annual pension allowance is lost after three years.

          For those looking to do some inheritance tax planning, it would be a good time to review (or make) your Will.

          Pension planning

          For most taxpayers the maximum pension contribution is £40,000 each tax year, although this depends on their earnings. This limit covers both contributions by the individual and by their employer.

          Note that the unused allowance for a particular tax year may be carried forward for three years and can be added to the relief for the current, but then lapses if unused.

          Hence the unused pension allowance for 2017/18 will lapse on 5 April 2021 if unused.

          Note that there are rumours that pension tax relief may be restricted in the next Budget. Under the current rules, the net after tax cost of saving £4,000 in a personal pension for a higher rate taxpayer is £3,000. HMRC then add a further £1,000 to your contribution and there is a further £1,000 relief when your tax liability is calculated, thus the value of your pension pot would be £5,000, for a net cost of £3,000. Remember that pension fund investments can go down as well as up, but a 40% fall would be unlikely.

          Need more information?

          We offer a wide range of services which are unique to your business and can assist with pension planning. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

          Our fantastic team at A&C Chartered Accountants are here to help.

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            By Katie Business News • Tax Advice • Tax News 0 Comments

            Diary of main tax events for November / December 2020

            See below for the diary of main tax events for November / December 2020.

            Date What’s Due
            1/12/20 Corporation tax for year to 28/02/2020 unless quarterly instalments apply
            19/12/20 PAYE & NIC deductions, and CIS return and tax, for month to 5/12/20 (due 22/12 if you pay electronically)
             

            30/12/20

            		 Deadline for filing 2019/20 tax return online in order to request that HMRC collect outstanding tax via the 2021/22 PAYE code
             

            1/1/21

            		 Corporation tax for year to 31/03/2020 unless quarterly instalments apply
             

            19/1/21

            		 PAYE & NIC deductions, and CIS return and tax, for month to 5/1/21 (due 22/1 if you pay electronically)
             

            31/1/21

            		 Deadline for filing 2019/20 self-assessment tax return online and paying your outstanding tax for 2019/20 and first payment on account of 2020/21 tax.

             

            Note that if this liability is no more than £30,000 you can agree with HMRC to spread over 12 months

            Need more information?

            Do you need help with the main tax events for November / December 2020. We are here for you and your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

            Our fantastic team at A&C Chartered Accountants are here to help.

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              presents
              By Katie Business Advice • Tax Advice 0 Comments

              Gifts to charity and Gift Aid

              presents

              Where possible taxpayers should “Gift Aid” any payments to charity to provide additional benefit to the charity. Higher rate taxpayers obtain additional tax relief on the grossed up amount donated.

              For example, where an individual makes a £20 cash donation to charity the charity is able to reclaim a further £5 from HMRC making a gross gift of £25. Where the individual is a 40% higher rate taxpayer he or she is able to claim a further £5 tax relief under self-assessment, reducing the net cost of their donation to £15.

              Note that the donor is required to make a declaration that they are a UK taxpayer and those that have not suffered sufficient UK tax to support the Gift Aid amount will taxed on the shortfall.

              Remember that Gift Aid does not just apply to gifts of cash. Many charity shops will now sell donated items on your behalf and are able to treat the sale proceeds as Gift Aided donations. It is also possible to gift quoted securities and land and buildings to charity and claim Gift Aid on the market value of those assets.

               

              Need more information?

              Do you need further help with Gift Aid and gifting to charities? We offer a wide range of services which are unique to your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

              Our fantastic team at A&C Chartered Accountants are here to help.

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                By Katie Business Advice • Tax Advice 0 Comments

                Christmas gifts for employees

                Have you thought about your Christmas gifts for employees yet? Remember that certain gifts to staff at Christmas are also tax free if structured correctly. Employers are allowed to provide their directors and employees with certain “trivial” benefits in kind tax free.

                This exemption applies to small gifts to staff at Christmas, on their birthday, or other occasions and includes gifts of food, wine, or store vouchers. There are of course a number of conditions that need to be satisfied to qualify for the exemption.

                Conditions for the exemption to apply

                • the cost of providing the benefit does not exceed £50
                • the benefit is not cash or a cash voucher
                • the employee is not entitled to the benefit as part of any contractual obligation such as a salary sacrifice scheme
                • the benefit is not provided in recognition of particular services performed by the employee as part of their employment duties (or in anticipation of such services)

                Need more information?

                We are here throughout the Christmas period to help you. If you need more guidance on Christmas gifts for employees, please do not hesitate to get in touch with us. We offer a wide range of services which are unique to your business and our team of chartered accountants have a wealth of experience in a broad range of sectors. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

                Our fantastic team at A&C Chartered Accountants are here to help.

                Contact us below

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                  By Katie Business Advice • COVID-19 • Covid-19 Hub • Tax Advice • Tax News 0 Comments

                  Are you working from home? Make a claim

                  With more of us working from home there is good news from HMRC that employees can now make a claim for tax relief to cover some of their costs while they are working from home.

                  The previous rule for employees was that there had to be a home working arrangement with their employer under which they were required to work from home on a regular basis to be paid £6 a week tax free (£4 a week up to 5 April 2020). This rule has now been relaxed as a result of COVID-19 so that such arrangements are not currently required and employees can also claim tax relief directly from HMRC where their employer does not make the payments.

                  £312 a year tax free is equivalent to £538 gross for a higher rate taxpayer. The payments are tax deductible for the employer and not liable to national insurance contributions.

                  Where the employer does not make the payments to the employee there is a new claims portal on the HMRC website so that the employee who is working from home can claim to deduct £312 from their employment income. That would generate a £124.80 tax refund for a higher rate taxpayer or £62.40 if basic rate.

                  There is a similar tax break for the self employed which provides a deduction from profits of up to £26 a month.

                   

                  Need more information?

                  Are you working from home? We offer a wide range of services which are unique to your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

                  Our fantastic team at A&C Chartered Accountants are here to help.

                  Contact us below

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