HMRC conducts Business Records Checks (BRCs) to ensure that businesses keep proper books and records. You might be contacted by a call centre arranging for a visit to inspect your records. You do not have to accept the date offered to you by HMRC, you can negotiate a time and date. HMRC say that the [...]
Is entertaining allowable?
The cost of entertaining is not allowed for tax. Even if the entire meal is spent discussing business the taxman will not allow you a taxable deduction against your profits or allow you claim back the input VAT. This also applies to any hospitality that you show to your customer. Subsistence, however, is allowed for [...]
Does being a limited company really offer you as much protection as you think?
Being a limited company has always provided protection to individuals against risks they take in business. In the past a shareholder’s liability has been restricted to the amount subscribed for shares. These days banks commonly ask for personal guarantees from the directors, thus exposing personal assets should a default on a company loan or overdraft [...]
Bribery Act 2010
The Bribery Act 2010 came into force in 2011. The main change to previous legislation is as follows: Introduction of a corporate offence of failure to prevent bribery by persons working on behalf of a business It is now criminal offence to give, promise or offer a bribe both in the UK and overseas This [...]
Official rate of interest
This is the rate that HM Revenue and Customs charge on late payment of tax. The rate was held at 4% for 2011/12.
Repairs or capital?
The distinction between whether an item of expenditure is a capital improvement or a repair can be very unclear. To gain the maximum tax relief it is always better to allocate an item as repairs. However, the tax man might not agree and if the expenditure is classed as an improvement it will be disallowed [...]
Paying pension contributions out of your business
Paying pension contributions out of your company is the most tax efficient way of paying into your pension. You pay neither employees nor employers national insurance on pension contributions and you will also obtain tax relief in your company. You also might have employees that pay into pension schemes. Have you considered making the payments [...]
Incorporate and save tax
Turning your sole trader or partnership into a limited company could save you significant amounts of tax and national insurance. The tax planning opportunities available for a limited company are far more varied than with a sole trader or partnership. The cost of forming a limited company is as little as £60. There are other [...]
Mortgages and HM Revenue & Customs
From 31st August 2011 mortgage lenders can ask HM Revenue and Customs to check the details declared to them on mortgage applications. The scheme is intended to stop mortgage fraud but also has implications for HMRC tax investigations. Fundamentally, this means that the income declared to mortgage lenders and that declared on self-assessment tax returns [...]
Dividends versus Salary
Paying a combination of salary, taxed under PAYE, and dividends can be much more tax advantageous than paying yourself only by salary. Dividends attract neither employees nor employers national insurance. On top of this, if you are a basic rate tax payer, you do not pay income tax on the dividends that you draw out. [...]
Facebook
LinkedIn
Twitter
