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So far Asif has created 163 blog entries.

Tax-free expenses for home-workers

2019-10-03T00:15:53+01:00October 4th, 2019|Categories: Blog, Taxation|Tags: , , , |

Providing certain conditions are met, no tax liability will arise if an employer makes payments to employees for reasonable additional household expenses, which the employee incurs in carrying out duties of their employment at home under 'homeworking arrangements'. 'Homeworking arrangements' are arrangements between the employee and the employer under which the employee regularly performs some or all of the duties of the employment at home. There is no requirement for any part of the employee's home to be used exclusively for the purposes of the employment. HMRC will accept that homeworking arrangements exist where: - there are arrangements between the [...]

Overdrawn director’s loan accounts

2019-08-23T16:24:33+01:00September 20th, 2019|Categories: Blog, Taxation|Tags: , , |

In a personal or family company, the lines between the directors as individuals and the company are often blurred – the director may lend money to the company when cashflow is tight and the company may lend money to the director or pay personal bills on the director’s behalf. Transactions between the director and the company are tracked via the director’s account. If the director’s account is overdrawn at the end of the accounting period (such that the director owes the company money) and the company is close, there are tax consequences to consider. Broadly, a close company is [...]

September 2019 Questions and Answers

2019-09-16T17:36:46+01:00September 18th, 2019|Categories: Questions & Answers|Tags: , , , , , |

Q. I am a qualified chiropractor and I have been running my own business for many years. I would now like to specialise in a particular area and have enrolled on a university course to obtain the relevant qualification. The cost is around £18,000 per annum and the course is three years in duration, during which time I intend to continue working part-time. Is the cost of the course deductible for tax purposes? A. Expenditure incurred by the owner of a business on training courses for themselves is revenue expenditure if the course merely updates existing expertise or knowledge. Expenditure [...]

Changes to main residence relief

2019-09-02T11:42:40+01:00September 13th, 2019|Categories: Blog, Property|Tags: , , , , , |

In his Budget on 29 October 2018, the Chancellor outlined a number of changes to main residence relief. The changes affect the final period exemption and the availability of lettings relief, which applies where a property which has at some time been an only or main residence, is let out. Main residence exemption No capital gains tax is payable on a gain arising on a property which throughout the period of the taxpayer’s ownership has been his or her only or main residence. If the property has been an only or main residence at some point, the taxable gain [...]

VAT ALERT: DOMESTIC REVERSE CHARGE IMPLEMENTATION DELAYED

2019-09-10T12:41:54+01:00September 7th, 2019|Categories: Blog, VAT|Tags: , , , |

There has been a last-minute change to the start date for the VAT domestic reverse charge (DRC) for building and construction services. This was scheduled to begin on 1 October 2019. It is now delayed until 1 October 2020. The government cites concern that some businesses are not yet ready to implement the change – and possible coincidence with Brexit – as the reasons for the delay. Despite the delay, the government is still committed to the DRC and there has been no change to the detail of the legislation. The DRC changes the way that VAT is accounted [...]

Payment on account of capital gains tax

2019-09-02T11:39:14+01:00September 2nd, 2019|Categories: Blog, Property, Taxation|Tags: , , |

From 6 April 2020 new rules apply to residential property gains liable to capital gains tax and from that date, UK residents will be required to make a return and a payment on account of the capital gains tax due within 30 days of the date of disposal of sale. Where the individual is a non-UK resident, the new rules will apply from 6 April 2019. What disposals are within the new rules? For UK residents, the new rules apply to a disposal on or after 6 April 2020 on which a ‘residential property gain’ arises. Certain disposals are [...]

Expenses that landlords can deduct

2019-08-23T16:24:28+01:00September 2nd, 2019|Categories: Blog, Property|Tags: , , |

Landlords must pay tax on any profit from their property rental business (although income from property of less than £1,000 a year can be ignored). In working out the profits, expenses are deducted from rental income. To ensure that the landlord does not pay more tax than is necessary, it is important to deduct all allowable expenses. Remember, the profit calculation is undertaken for the property income business as a whole, not on a property by property basis. Consequently, it does not matter whether the expenses incurred in relation to an individual property exceed the rental income from that [...]

VAT Reverse Charge for Construction Services

2019-08-25T00:21:04+01:00September 1st, 2019|Categories: Articles & Guides, Blog, VAT|Tags: , , |

The VAT domestic reverse charge for building and construction services comes into effect from 1 October 2019. The reverse charge represents part of a government clamp-down on VAT fraud. A domestic reverse charge means that a contractor receiving a supply of specified construction services must account for the output VAT due, rather than the sub-contractor who supplied the services. The contractor also deducts the VAT due on the supply as input VAT, subject to normal VAT rules, meaning no net tax is usually payable to HMRC. The reverse charge thus removes the scope to evade any VAT owing to [...]

The CGT annual exemption – use it or lose it!

2019-08-23T16:24:19+01:00August 30th, 2019|Categories: Blog, Taxation|Tags: , , |

Capital gains tax (CGT) is normally paid when an item is either sold or given away. It is usually paid on profits made by selling various types of assets including properties (but generally not a main residence), stocks and shares, paintings, and other works of art, but it may also be payable in certain circumstances when a gift is made. Some assets are exempt from CGT, including assets held in an Individual Savings Account (ISA), betting, lottery, or pools winnings, cash held in sterling, jewellery, antiques, and other personal effects that are individually worth £6,000 or less. The most [...]

Give to charity to reduce your inheritance tax bill

2019-08-23T16:24:08+01:00August 27th, 2019|Categories: Blog, Taxation|Tags: , , , |

Making gifts to charity can be an effective way to reduce the amount of inheritance tax (IHT) payable on your estate. Charitable gifts can work to reduce the IHT payable in two ways: reducing the value of the net estate chargeable to IHT; or where the gifts to charity are worth at least 10% of the net estate at death, reducing the rate at which inheritance tax is payable. Lifetime gifts and bequests on death made to qualifying charities and registered housing associations are exempt from inheritance tax, provided that the gift was made outright. Qualifying charities A qualifying [...]

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