Category: Tax Advice

There has been a lot of speculation in the Press that the Chancellor may introduce radical changes to capital gains tax to start to repay the substantial Government borrowings to support businesses and employees affected by the coronavirus pandemic.

It has been suggested that the current £12,300 CGT annual exemption will be reduced and the rates aligned with the rates of income tax. It has also been suggested that the capital gains uplift on death may be abolished following recommendations by the Office of Tax Simplification and the House of Commons Treasury Select Committee.

The Treasury Committee has recently launched a new inquiry called ‘Tax after coronavirus’. That inquiry will consider different ways of raising taxes, in particular a thorough review of UK tax reliefs which has also been recommended by the Public Accounts Committee.

The Chancellor has also hinted that there may be radical changes to the way that the self-employed and directors of family companies may be taxed in future.

Do you need help with capital gains tax? We offer a wide range of services and have a dedicated team of tax specialists. We work with businesses from a large range of sectors and are here to help you whenever you need us. 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.

Reporting property gains within 30 days

Since 6 April 2020 where UK residential property is disposed of, the resulting capital gain needs to be reported and the capital gains tax paid within 30 days of completion of the disposal. There have been a number of teething problems with the new online reporting system and HMRC stated that there would be no penalties imposed for late returns, provided the returns were submitted by 31 July 2020. Taxpayers need to obtain a Government Gateway account and apply for a CGT or property reference number to report disposals, although they can authorise their accountant to report the disposals on their behalf.

Currently only the first disposal may be reported using the online reporting system with any subsequent disposals being reported using a paper return. We have been told that the new system will be fully functional shortly.

Do you need help with property gains? We offer a wide range of services and 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.

Small businesses with turnover below £150,000 may join the VAT flat rate scheme which makes their VAT accounting much simpler as they merely pay HMRC a percentage of their VAT inclusive turnover.

The temporary reduction in the rate of VAT from 20% to 5% reduces the flat rate percentages for affected businesses as set out below:

Note that to use the flat rate percentage for pubs the turnover must be predominantly “wet sales”.

Do you need help with the VAT flat rate scheme? We offer a wide range of services to help! 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.

It is fairly common, particularly in the summer holidays, to pay  deposits when booking a hotel or self-catering accommodation but how should the deposit be accounted for?

HMRC have confirmed that the hotel has the option of charging VAT according to the ‘basic tax point’ (dates of the stay) rather than the ‘actual tax point’ (invoice/payment dates).

For example where the customer paid a non-refundable £300 deposit in February 2020 for a £1000 holiday in Cornwall in August, using the actual tax point, the hotel would account for 20% VAT on the deposit received in February 2020 and 5% on the balance payable after 15 July 2020.  The hotel could choose to use the basic tax point rule which would mean that the 5% rate would apply to the entire cost of the stay and make an adjustment for the VAT already accounted for.

Please contact us if you need advice on dealing with the invoicing or accounting for such transactions.

We specialise in VAT and we are here to help you with deposits. 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 hospitality 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.

A recent tax tribunal has ruled against HMRC who were seeking to raise tax assessments for the High Income Child Benefit Charge (HICBC) for earlier years that had not been reported to HMRC.

HICBC is a special tax charge that applies where one member of a couple in receipt of child benefit receives income in excess of £50,000 a year. The charge is 1% of the child benefit received for every £100 of income in excess of £50,000 such that where income exceeds £60,000 the child benefit is fully taxed.

The problem is that many taxpayers whose income is taxed under PAYE do not receive a self-assessment tax return and may not be aware of the tax charge.

The taxpayer in this particular case fell into that category but reported and paid the tax when prompted by HMRC. He was then assessed to tax on the child benefit for the three previous years but the court found that HMRC did not have the power to issue those assessments.

We offer a wide range of services which are unique to your business and deal with HMRC on a regular basis! Our team of chartered accountants have a wealth of experience in a broad range of sectors and we work hard to ensure we 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.

The temporary 5% rate applies to the following supplies, but is not an exhaustive list:

• Catering, including hot takeaway food
• Accommodation in hotels, guest houses and similar places
• Tourist attractions such as theme parks, zoos, theatres and cinemas

Note that as far as catering is concerned, the 5% rate only applies to food and non-alcoholic drinks. The 20% rate continues to apply to alcoholic drinks.

Please contact us if you are unsure as to whether the 5% rate applies to any of your supplies.

Do you need further guidance on the 5% temporary VAT rate? We offer a wide range of services for the hospitality industry and work with many hotel and restaurant clients.  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.

HMRC have recently announced that they may allow limited companies to make claims for loss relief and tax refunds even though the current accounting period has not yet ended and the corporation tax return has not been submitted. This will be available to companies of all sizes but they will be required to provide evidence to support the claims.

REFUNDS OF QUARTERLY INSTALMENT PAYMENTS

Companies with profits in excess of £1.5 million are required to make quarterly instalment payments (QIPs) of their corporation tax liability much earlier than the normal payment date which is 9 months after the end of the accounting period.

For year ended 30 June 2020 a company with profits between £1.5 million and £20 million would be required to pay 25% of the estimated liability on 14 January 2020, 50% on 14 April with further payments due on 14 July and 14 October 2020. Where profits exceed £20 million the payments are due 3 months earlier.

If the same company now anticipates that it will make a loss for year ended 30 June 2020 they may be able to have the tax paid in January and April repaid and the further QIPs reduced to nil. Furthermore, HMRC may allow the losses to be carried back and set against the previous accounting period ended 30 June 2019 resulting in a further tax repayment even though the 30 June 2020 corporation tax return has not yet been submitted.

Note that the £1.5 million and £20 million limits referred to above are divided by the number of companies under common control so for example the limit would be £500,000 per company if there are 3 companies in a group.

CARRY BACK TO PREVIOUS ACCOUNTING PERIOD

Where company profits are below the £1.5 million limit then QIPs will not be due but they may still be able to make a claim to set a loss against profits of the previous accounting period and obtain a tax repayment where losses are anticipated. We can of course help you make a claim and negotiate a tax repayment with HMRC.

If you need help with your tax refunds we have a dedicated team on hand. We offer a wide range of services and 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.

Despite the coronavirus lockdown HMRC have announced that they will still expect P11d forms reporting expenses and benefits to be submitted by the normal 6 July deadline.

Remember that reimbursed expenses no longer need to be reported where they are incurred wholly, exclusively and necessarily in the performance of the employee’s duties. Dispensations from reporting are no longer required.

Note also that trivial benefits of no more than £50 provided to employees need not be reported.

We offer a wide range of services which are unique to your businesses who are just getting going! 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.