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HMRC urge people to prepare for CGT payment change

2020-04-01T19:40:32+01:00April 12th, 2020|Categories: Blog, HMRC, Taxation|Tags: , , , , |

Property owners are being urged to get ready for changes to the deadline of capital gains tax (CGT) payments. Broadly, from 6 April 2020, a UK resident who sells a residential property in the UK will have 30 days to tell HMRC and pay any CGT Tax owed. HMRC are currently developing a new online service to allow taxpayers to report and pay any CGT owed. A CGT report and accompanying payment of tax may be required where the taxpayer sells or otherwise dispose of: - a property that they have not used as their main home; - a holiday [...]

February 2020 Questions and Answers

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

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 [...]

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 [...]

August questions and answers

2019-08-23T16:22:41+01:00August 6th, 2019|Categories: Questions & Answers|Tags: , , |

Q. A few years ago I bought an antique chair for £3,500. I have recently been offered £8,000 for it. Will I have to pay capital gains tax if I accept the offer? A. A useful capital gains tax exemption exists for tangible moveable property (a chattel) which is not a wasting asset (broadly, an asset with a predictable life not exceeding 50 years). A gain on disposal of a chattel is exempt if the disposal consideration is £6,000 or less. Where disposal proceeds exceed the exemption limit, the gain is limited using the following formula: 5/3 x (disposal consideration [...]

Beware disposals to family members – the ‘market value’ rule

2019-09-02T11:29:25+01:00July 7th, 2019|Categories: Articles & Guides, Blog|Tags: , , |

At first sight, the calculation of a capital gain or loss on the disposal of an asset is relatively straightforward – simply the difference between the amount received for the sale of that asset and the cost of acquiring (and, where relevant) enhancing it, allowing for the incidental costs of acquisition and disposal. However, as with all rules there are exceptions, and particular care needs to be taken when disposing of an asset to other family members. Spouses and civil partners The actual consideration, if any, is ignored for transfers of assets between spouses and civil partners. Instead, the [...]

October Questions and Answers

2019-09-01T22:08:58+01:00October 31st, 2018|Categories: Questions & Answers|Tags: , , |

Q. I bought my house in 1998 and I lived in it until 2000 when my employer required me to work in Spain. I returned to live in the house in 2005 and have lived there until now. I have never owned any other properties. Will I qualify for full private residence relief for capital gains tax purposes when I sell my home? A. Based on the information provide, you should be entitled to full relief. The qualifying periods of absence are: a) absences for whatever reason, totalling not more than 3 years in all b) absences during which you're [...]

January questions and answers

2019-09-01T11:57:58+01:00January 29th, 2017|Categories: Questions & Answers|Tags: , , , |

Q. I am thinking of renting out a small outbuilding that I own to a friend so that he can store his work equipment in it when he's not using it. The rent is likely to be less than £1,000 a year. Will I have to declare this income to HMRC on a self-assessment return? My tax affairs are quite straight-forward - I am employed and currently I don't need to send in a tax return. A. Two new annual tax allowances of £1,000 each are being introduced from April 2017. One allowance is for trading income and the [...]