With more and more people each year passing assets and money to friends and family, its important to know that passing on items with monetary value in the wrong way can incur higher taxes if not done the most tax efficient way.
The individual circumstances for each person are unique and as such you should always seek expert tax advice from an expert like Tax Affinity Accountants - considered one of the Industry leader's with regards to their tax and accounting knowledge and experience. However we have also listed the basic rules below as a guide:
By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. With branches in Surbiton , Worcester Park , Kingston upon Thames , Cheam and Epsom they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice and support. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.
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It's April and this means the end of the previous tax year and start of the next. HMRC's personal tax year runs from 6th April to 5th April each year.
The start of the new UK tax year from 6.4.18 means there are new opportunities and new rules and allowances that now apply. So, it is a good time to take a moment and work through what is best for you and your personal circumstances to make them more tax efficient and plan and budget for the coming year. The UK government and HMRC are ramping up their collection system and enforcement to try to get as much money in to pay for Brexit and other services etc so it’s up to each individual to become more vigilant to how they may end up with less in their pocket than previously. Checking your income tax code regularly is now a necessity. Call HMRC immediately if something looks incorrect or out of the norm. Tax codes can often be incorrectly produced if there is a slight mix up in info and recent news reports have highlighted more changed tax codes than usual. Complete your personal tax return for 17/18 early. It’s not worth waiting till 31st January 2019 when its actually the payment deadline day to work out how much tax is due if your self-employed because if you are owed a tax refund this means waiting till Feb / March 2019. Also, if you do owe tax then you have 9 months to plan and budget to pay for the sooner you know how much is due. The personal tax-free allowance goes up to £11,850 from £11,500 and dividend tax allowance falls to £2000 from £5000, similar movements with other allowances means it helps to plan ahead to decide which year to receive and declare income. A good tax accountant can help with this - note an average bean counter (accountant) does not normally keep up to date with rapidly changing tax rules and regulations so may not be able to help. We always recommend you speak to an expert tax accountant - they should save you far more in tax than they ever charge plus their fees are tax deductible - so it’s a win, win situation if your serious about planning ahead and paying less tax the correct way. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. With branches in Surbiton , Worcester Park , Kingston upon Thames , Cheam and Epsom they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice and support. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. The General Election, Brexit, Falling UK Sterling and lower consumer confidence across the UK has made a perfect storm of negativity with small to medium sized businesses seeing lowering sales and profit in last couple of months.
We've seen this is with many of our clients. (Why is your current accountant not telling you this?) And this worrying trend may last longer as the summer months arrive and peoples' focus switches to holiday and spending less money as they keep hearing about inflation and other scary words they don't understand. So with that in mind how does a small / medium sized business keep growing or, at the very least, keep the money coming same as previously? Well at Tax Affinity Accountants we've been helping business through many recessions / downturns and believe in giving useful real time support and advice to small and medium sized businesses. And with this in mind the tried and tested list below will help: 1. Go where the money is - be adaptable and look to see what is selling and sell more of that and stock less that which is in less demand. If its a different product or service that you don't offer consider adding this. 2. Give the customer what they want not what you want - listen to them and understand them properly and give them what they are looking for. Your customer will tell you how to keep things going in your business. Ask them, remember you have two ears and one mouth, use them in that proportion. 3. Make an offer they cant refuse - when things are difficult for a client make sure you have offers and special deals like the supermarket and larger traders do to entice them. This may mean offer something at a low price with the plan to sell another product/service that compliments that item and will make more profit. 4. Keep an eye on competition - make sure your business is not lagging behind on the four P's of the marketing mix - Product, Price, Promotion, Place. All four need to be excellent to ensure growth in a downturn. 5. Give away stuff to entice people to keep visiting - This doesn't mean give everything away at a knock down price, but more specifically could mean a good chance to clear out old stock items and have more space by getting rid of it at cost price. The customers get a good deal and you keep the cash-flow coming in. 6. Don't use bad economic conditions as an excuse - stay focused and think positive, don't listen to negative sources of information, look at the positive sources as well. Many large retailers have a positive outlook, its just that media outlets like to dwell on negativity as bad news sells better than good. Compare your business to the bigger companies and see what they are doing and what you can do as well. The Director / CEO that thinks and plans positively is the one that drive their business forward. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting contractors and self employed people throughout the UK, they regularly help clients grow their business providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. Thousands of reminder letters from HMRC have begun to drop on across door steps in the UK. The tax year ended 5/4/17 ie 2016 -2017 self assessment is now due to be completed and the sooner you do it the sooner you can get a refund of income tax or know how much you need to save and pay.
If you already have a personal UTR - unique tax number then the letter may have already arrived or will be on its way. If you do not then you may need to ensure you or your accountant has applied for one to allow for its submission. Who needs to do a tax return? You’ll need to have a personal tax return calculated and submitted if, in the last tax year:
By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting self employed people throughout the UK, they regularly help clients grow their business providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. HOW THE SPRING BUDGET 2017 AFFECTS THE SELF EMPLOYED & LIMITED BUSINESSES
The income tax personal allowance and the basic rate bands for this year’s tax return have already been announced. From 6th April 2017, personal allowance is set to increase by £500 to £11,500 and the basic rate band will rise to £33,500 from £32,000. This will result in a higher rate threshold of £45,000. The Chancellor has proclaimed that the personal allowance will continue to rise to £12,500 and higher rate threshold to rise to £50,000 by the end of the Parliament. Also, the Capital Gains Tax annual exemption will increase by £200 in 2017/2018 from £11,100 to £11,300. The rate of National Insurance Contributions for self-employed people will rise. Presently, self-employed individuals have to pay both Class 4 and Class 2 National Insurance Contributions (NICs):
From April 2018, it has been announced Class 2 NICs will be abolished and Class 4 NICs will remain the same. As a result of this, the self-employed will save £145 annually. This will allow them to keep more of their money and be able to invest it back into their business. Tax Free Dividend Allowance will be reduced from £5,000 to £2,000 from next year April 2018. This is because this will lessen the tax difference between the self-employed and employees. Those that will be affected, will be investors with stocks and shares worth over £50,000 outside an ISA. £435 million will be given to support any business that have been affected by the business rates relief revaluation. Therefore, no small businesses will pay more than £600 coming out of the small business rates relief than they did in year 2016-17. Financing local authorities will permit them to administer £300 million of discretionary relief to contribute in helping the businesses that are heavily affected by the revaluation. Landlords and small businesses below the VAT threshold will be given an extra year to get ready for Making Tax Digital. Businesses that are owned privately (unincorporated businesses) that have a turnover under the VAT threshold will have until April 2019 to prepare for this before "Making Tax Digital" becomes mandatory. Making Tax Digital is where businesses will have to use a specific digital software to maintain their tax records and update HMRC quarterly (every 3 months). The introduction of this complex digital scheme, which is involving commercial supplies or accounting software, runs smoothly, there is a likelihood that there will be substantial administrative trouble, especially for those businesses that presently do not use an accounting software. By Gopal Nath at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. As of today there are only 7 working days till the 31st January 2017, which is HMRC's online self assessment deadline.
The submission of the personal income tax return and the payment of any tax and NI due for the period 6/4/15 to 5/4/16 is midnight 31/1/17. And anyone who has not yet had their tax return done and paid for should start to worry about the up to £1300 fine plus interest on late paid tax imposed by HMRC for missing the deadline. The self assessment / personal tax return is required from the following types of people: 1. Self Employed (even partially) during the tax year 15/16 ie 6/4/15 to 5/4/16 2. Employed and earning over 100k for the year ended 5/4/16 3. Director or shareholder of a Company and taking dividends in the period as above 4. If you have received rental income in the period 6/4/15 to 5/4/16 5. You received savings and investments income in the period 6/4/15 to 5/4/16 6. You sold something and made a profit on the item, so are required to pay the Capital Gains Tax (CGT) eg selling shares, a property, an antique, Plant and Machinery etc 7. You have received income over £50,000 and you claimed Child Benefit 8. If you have not notified HMRC that you have left self employment and they have not confirmed that you do not need to do a 15/16 return 9. A letter / email / text from HMRC has been received by the tax payer advising them that they need to submit a tax return for the 15/16 year (note: only new registrants may get a reminder as HMRC expects old registrants to already know the deadlines and protocols required). 10. You received income from overseas 11. You lived abroad and had income from the UK 12. You are retired and receive more than one type of pension and annual income payment pushing you over the personal income allowance 13. You have had a P800 from HMRC saying you have not paid enough tax in the year 14. You are minister of religion or and Underwriter 15 Even if a person has died they may still need to submit a tax return to make sure they have paid the correct tax and those that receive an inheritance may need to pay for Inheritance Tax (HMRC will advise further). 16. If you have received a P11d and not paid the correct tax for the benefit in kind eg company car, private medical, gym, travel etc So if you haven't already had your tax return done and still need to send / drop in your income and expenses information, please take heed of this final reminder. Those that have handed in their information we will make sure it is done before the deadline. We can even have your deadline extended in some cases as we are registered authorised agents for HMRC. And if your thinking of using an accountant, note, that not all accountants are the same. We recommend you use an expert in tax so he/she saves you far more in tax than you ever have to pay them for their service. With fines up to £1300 plus interest on the amount of tax due. In some cases penalties are greater than the tax that would have been due. So don't delay as you have no time left and most excuses and appeals are rejected by HMRC after a penalty has been imposed. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. The Importance of Submitting Personal Tax Returns to HMRC Before 31 Oct Deadline
The UK tax year starts from 6 April to 5 April the following year. You’ll need to send a tax return if in the last tax year
Chargeable Income It is your responsibility to notify HMRC of any income arising that makes you liable to tax. Notification must be received by 5 October otherwise you will have to pay a penalty. Filing a Tax Return The deadline for filing a tax return by post is midnight on 31 October. You will have to register by 5 October so we recommend registering well in advance as the process can take 4 weeks. If you miss this deadline, don't worry as you can file your tax return online by midnight 31 January the following year (3 months later). To file online, you will again need to register well in advance with HMRC for this service as the process could take several weeks. However a good accountant has the resources and expertise to file your tax return online without needing to register. If you file your tax return late, you will face a £100 penalty even if you do not owe any tax. The following penalties also apply for late filing of tax returns:
There is also a penalty if you file your tax return incorrectly depending on your behaviour.
Paying Tax The deadline for paying tax is 31 January and there are three charges for late payments.
By Hamza Habib at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Surbiton they are considered in the Industry to be experts accountants for small businesses. Helping and supporting business throughout the UK, they regularly help new and established businesses to succeed. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. Importance of Submitting Personal Tax Returns to HMRC before 31 Jan Deadline The UK tax year starts on the 6th of April every year and finishes on the 5th of April the following year e.g. the tax year for 2013-14 would have started 6th April 2013 and finished on April 5th 2014. Under current legislation, if you are a self employed sole-trader, partner in a business partnership, a company director or earn above £100,000 per annum then you will be required to submit a tax return to HMRC; unless you work for a non profit organisation in which you don’t receive pay or benefits e.g. travel expenses or company cars. If you are not sure of your situation then you should contact HMRC for further clarification. The Deadlines: There are three main deadlines to follow:
The Penalties There are a few penalties and interest charges that with be applied if your tax returns are not received by the deadlines noted. If the final deadlines to file your tax returns are not met then you will get an initial fine from HMRC of £100. If there is continued failure to meet the deadlines then the following fines will be placed.
Also penalties can be issued for incorrect tax returns:
As each person’s situation is different and the tax rules and regulations regarding tax free allowances, income tax, inheritance tax, capital gains tax on property, stock and shares etc can be quite complicated. Therefore it is highly recommended that everyone should seek the help and support of an experienced and qualified accountant or tax advisor. A s a reputable firm of accountants such as Tax Affinity Accountants will usually save you far more money in saved taxes through their tax planning than they will ever charge. Leaving you more time and money to concentrate on your business. By Mohammad Khan at Tax Affinity Accountants. As experts in property tax we often get asked by clients who are landlords and property developers how to save tax - especially so as the cost of letting a property rises year on year.
With our experience and special insider knowledge that HMRC in 2014 - 2015 is especially looking at checking landlords who are not declaring the correct rental income and correct capital gains on second homes. This is something that is becoming more important as people realise it is harder and harder to hide their untaxed property incomes. Landlords or their accountants are required to fill the the land and property section on their self assessment tax return showing all the rental business income they have made and as many want to make sure they pay the least amount of tax possible. We have have created a simple list to help guide you. Here are Tax Affinity Accountants top tips to save property tax. 1. Claim for all your property related expenses. Its important to make sure you claim for all your expenses when submitting your tax return. These should include: • Travel costs incurred when travelling back-and-to the investment property • Estate Agent or private advertisement costs • Mobile or landline telephone calls made (or text messages sent) in connection with the rental property • Payments for safety certificates eg Gas Safety • Bank charges (i.e. overdraft, interest on mortgage) • Professional fees e.g. Architect, Solicitor, Accountant etc • Monthly payments to property investment related products and services eg Insurances etc 2. Dividing your rental income between partners. A top tip is to consider putting your buy-to-let property into joint named ownership. Then the total income can be divided into each person's income and multiplying the personal allowance claimable on the income. 3. Claim all empty period expenses. Often there are periods between lettings that the buy-to-let property is empty and the owner has to pay for council tax or utlity bills. These should be noted and claimed. 4. Claiming the home office allowance. £4 per week (ie £208 per year) can be claimed for the use of your home to manage and run your rental property income. This amount can be claimed without evidence and more can be claimed if it can be justified. 5. Interest and finance costs. Most properties are on mortgages and the interest part of any mortgage is claimable as an expense. So if you have an interest only mortgage then the whole amount is claimable per month paid. Often landlords also forget to claim for money borrowed from friends or family or taken on a credit card or personal loan for the buy-to-let property and the interest on these can also be claimed. The principal can only be claimed when selling the property against capital gains tax. 6. Dont forget to carrying forward loss from previous year Most of the time a new buy-to-let property will not breakeven in its first year and so many landlords have significant rental losses for that year. Then when they start to make income from the property most forget about this loss which can be offset against the current years income. This could even mean no tax to pay in the current year if the losses are great enough. This requires detailed technical knowledge and so any lanldord in this situation should contact an experienced accountant such as Tax Affinity Accoutants. 7. Capital gains avoidance If landlords who are planning to sell their property, need to plan months or even a year ahead to increase their options of minimising capital gains tax which will arise on the sale of the property. This is usually best done getting expert advice from an accountant experienced in tax and property such as Tax Affinity Accountants. What top property developers and landlords know that mostly the fees paid to a good accountant are far less in comparison than the tax he/she will save you. 8. Wear and tear allowance Letting your property as furnished as opposed to unfurnished can allow you to claim up to 10% of the gross income as a valid expense for the upkeep and repair of furtniture in the tax year. 9. Make Sure to avoid HMRC interest and penalties Sound obvious but far to often, we see penalties and interest charges for late filing of tax returns and missed deadlines for documents to HMRC. The deadline for a paper return to HMRC is 31st Oct and online 31st Jan each year. Please also not that landlords will not be able to submit their return electronically if there are any capital gains elements on the return. ie the sale of any property. An experienced accountant needs to be contacted for this purpose which if knowledgable enough could ensure all capital expenditure is claimed to reduce the capital gains liability as low as possible. By Andrew at Tax Affinity Accountants. Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they are considered to be property tax experts helping and supporting ladlords across the UK. They regularly help new landlords and property developers and provide valuable ongoing support. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. How the queen’s new polices will affect businesses around the UK (big/small)
Today I will give you some insight into how the queen’s new polices will affect businesses around the UK (big/small). There are various topics from the queen’s speech that would affect businesses around the UK (big/small). I will discuss each one in detail to give you an insight before it comes into play. ''To build a stronger economy we must support smaller businesses to compete within their sector. Furthermore, we should ensure they should not be disadvantaged by those who do not play by the rules (larger companies)''. The main elements are:
We must protect public revenues by tackling avoidance and also help hard working taxpayers by simplifying the collection of class 2 National Insurance contribution (NIC) paid by the self-employed. Simplifying the NICs paid by the self-employed:
Public sector land assets are to be transferred directly from arms-length bodies to the homes and communities agency, reducing bureaucracy and managing land more efficiently. Furthermore, guarantee that future purchases of land owned by the homes and communities agency and the Greater London authority will be able to develop and use land without being affected by easements and other rights and limitations suspended by the agency. Land registry would transfer statutory responsibility for the local land charges register and delivery of local land charges searches to the land registry, supporting the delivery of digital services and broaden land registry’s powers to facilitate it to grant information and register services relating to land and other property. The adjustments to the pension tax rules (as announced at the budget) are to help people get on by giving them greater independence and choice over how to access their defined contribution pension savings. The main elements are:
Other measures that will effect businesses and indviduals are as follows:
By Tahir Malik at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they are considered in the Finance Industry to be the experts in all types of Accounting and Tax issues. Helping and supporting businesses and individuals throughout the UK, Europe and USA. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. |
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