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February 2020 Questions and Answers

Q. What items can be excluded from ‘taxable turnover’ for VAT registration purposes? A. When the 'taxable turnover' of a business reaches the VAT registration threshold, currently £85,000 per annum, it must register for VAT. Income that is not counted as 'taxable turnover' is excluded from the £85,000 turnover figure. There are several items that can be ignored when calculating 'taxable turnover' for VAT registration purposes. Any income that is 'exempt' from VAT is ignored. This commonly includes insurance, postage stamps or services; and health services provided by doctors or dentists. - Some goods and services are outside the VAT [...]

2020-02-11T22:24:29+00:00February 17th, 2020|Categories: Questions & Answers|Tags: , , , |0 Comments

VAT and Brexit

HMRC have not yet issued any guidance as to how imports and exports to the EU and out with the EU should be recorded for VAT return purposes after 31 January 2020, what happens with the reverse charge, and what should be recorded in boxes 8 & 9 of the VAT return. The last guidance given was in the case of a no deal Brexit and we are monitoring any new advice as it is issued. HMRC have said: - There will be NO requirement to complete an EC sales list for sales after 1 January 2021. - Intrastat returns [...]

2020-02-11T22:21:09+00:00February 16th, 2020|Categories: Blog, VAT|Tags: , , |0 Comments

Increased National Minimum Wage rates from April 2020

Some three million workers are set to benefit from increases to the National Living Wage (NLW) and minimum wage rates for younger workers from 1 April 2020. The compulsory NLW is the national rate set for people aged 25 and over. The NLW is enforced by HMRC alongside the national minimum wage (NMW), which they have enforced since its introduction in 1999. Generally all those who are covered by the NMW, and are 25 years old and over, will be covered by the NLW. These include: - employees; - most workers and agency workers; - casual labourers; - agricultural [...]

2020-02-11T22:17:18+00:00February 14th, 2020|Categories: Blog, PAYE|Tags: , , , |0 Comments

CGT on Cryptoassets

Cryptoassets are a relatively new type of asset that have become more prevalent in recent years. New technology has led to cryptoassets being created in a wide range of forms and for various different uses. Cryptoassets (or 'cryptocurrency' as they are also known) are cryptographically secured digital representations of value or contractual rights that can be: - transferred - stored - traded electronically While all cryptoassets use some form of Distributed Ledger Technology (DLT) not all applications of DLT involve cryptoassets. HMRC do not consider cryptoassets to be currency or money. They have identified three types of cryptoassets: - [...]

2020-02-11T22:13:54+00:00February 11th, 2020|Categories: Blog, Taxation|Tags: , , , , , , , |0 Comments

January 2020 Questions and Answers

Q. I am the sole director and shareholder of a limited company, which has been trading for many years. Last year, I took an extended holiday and travelled around the world with my wife. We were away for twelve months in total. Whilst I was away the company continued to collect outstanding payments, but it did not receive any other income. Now that I am back, I have taken on another director/shareholder (50%) and company trading has resumed. Should I have informed HMRC that I was going away and how should the losses in the period of temporary non-trading [...]

HMRC advisory fuel rates from 1 December 2019

HMRC have published company car advisory fuel rates for use from 1 December 2019. The rates apply when employers reimburse employees for the cost of fuel for business travel in their company cars or require employees to repay the cost of fuel used for private travel. HMRC review rates quarterly on 1 March, 1 June, 1 September and 1 December. The rates applying from 1 December 2019 are as follows: Petrol and LPG Engine size 1400cc or less: petrol 12p per mile, LPG 8p per mile 1401cc to 2000cc: petrol 14p per mile; LPG 9p per mile Over 2000cc: petrol [...]

2020-01-03T11:58:05+00:00January 5th, 2020|Categories: Blog, HMRC, Taxation|Tags: , , |0 Comments

What does the General election mean for tax?

Following the General election on 12 December, Prime Minister Boris Johnson has confirmed that Sajid Javid remains as Chancellor of the Exchequer and no other changes at HM Treasury have been announced. The Prime Minister has however, confirmed that a more significant cabinet reshuffle will take place after the UK leaves the EU on 31 January 2020. The Conservative manifesto set out a fairly limited number of tax pledges, with commitment to a triple lock on income tax, national insurance contributions (NICs) and VAT, which means there should be no tax hikes forthcoming in these areas. Moreover, the government has said it will [...]

2020-01-03T11:50:32+00:00January 3rd, 2020|Categories: Blog, Taxation|Tags: , , |0 Comments

Should I incorporate my business?

As things currently stand, the expected cut in the main rate of corporation tax to 17% from April 2020 is unlikely to happen, but current corporation tax rates remain pretty favourable. There are also other areas where company formation may help save tax. The costs and regulations involved with running a company are usually greater than trading as a sole trader or in partnership, and should not be overlooked. In addition, incorporation generally means an increase in administration, which some businesses may find burdensome. The starting point for dealing with companies and company directors is to remember that a limited company [...]

2019-12-18T23:25:53+00:00December 27th, 2019|Categories: Blog, Business, Limited Company, Self Employment|Tags: , , |0 Comments

Should I register for VAT?

In broad terms, and subject to certain exceptions, a business will be required to register to charge and pay VAT once annual sales reach a pre-set annual threshold, which is currently £85,000. This threshold is determined by total sales and is not the same as total profits (which is generally sales minus expenses). However, a business can register for VAT even if its turnover (total sales) is below the threshold and it may actually save tax by doing so, particularly if its main clients or customers are organisations that can reclaim VAT themselves. Example Bill is a non-VAT registered [...]

2019-12-18T23:21:11+00:00December 21st, 2019|Categories: Blog, Business, VAT|Tags: , , , |0 Comments
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