Blog - PMA Accountants

October Questions and Answers

Q. Our house has always been owned jointly by myself, my mother and my sister. My sister and I now want to buy our own homes and want to make mum the sole owner of our current home. If we put the house in her sole name will she have to pay capital gains tax (CGT) on it? A. Transferring the house into your mother's sole name will not trigger a liability to CGT, but it may have CGT implication for you and your sister. However, since you live in the property, it is quite likely that you would qualify [...]

Asif2019-10-03T00:19:07+01:00October 23rd, 2019|Categories: Questions & Answers|Tags: Capital Gains Tax, Company Car, Construction Industry Scheme|0 Comments

Tax-free expenses for home-workers

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 [...]

Asif2019-10-03T00:15:53+01:00October 4th, 2019|Categories: Blog, Taxation|Tags: BLOG, Expenses, HMRC, Working From Home|0 Comments

Overdrawn director’s loan accounts

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 [...]

Asif2019-08-23T16:24:33+01:00September 20th, 2019|Categories: Blog, Taxation|Tags: BLOG, Directors Loan, Section 455 Charge|0 Comments

September 2019 Questions and Answers

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 [...]

Asif2019-09-16T17:36:46+01:00September 18th, 2019|Categories: Questions & Answers|Tags: Buy-To-Let, Capital Gains, Q&A, Training Courses, VAT, VAT MOSS|0 Comments

Changes to main residence relief

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 [...]

Asif2019-09-02T11:42:40+01:00September 13th, 2019|Categories: Blog, Property|Tags: BLOG, Landlords, Letting Relief, Main Residence Relief, Property, Tax|0 Comments

VAT ALERT: DOMESTIC REVERSE CHARGE IMPLEMENTATION DELAYED

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 [...]

Asif2019-09-10T12:41:54+01:00September 7th, 2019|Categories: Blog, VAT|Tags: BLOG, Construction Industry, Domestic Reverse Charge, VAT|0 Comments

Payment on account of capital gains tax

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 [...]

Asif2019-09-02T11:39:14+01:00September 2nd, 2019|Categories: Blog, Property, Taxation|Tags: Capital Gains Tax, CGT, Property|0 Comments

Expenses that landlords can deduct

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 [...]

Asif2019-08-23T16:24:28+01:00September 2nd, 2019|Categories: Blog, Property|Tags: BLOG, Expenses, Landlords|0 Comments

VAT Reverse Charge for Construction Services

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 [...]

Asif2019-08-25T00:21:04+01:00September 1st, 2019|Categories: Articles & Guides, Blog, VAT|Tags: CIS, Construction Industry, Domestic Reverse Charge|0 Comments

The CGT annual exemption – use it or lose it!

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 [...]

Asif2019-08-23T16:24:19+01:00August 30th, 2019|Categories: Blog, Taxation|Tags: BLOG, Capital Gains Tax, CGT|0 Comments

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