News and Updates

 

No more relief for goodwill and intangibles

The Finance Act 2015 and proposals in the Finance Bill restrict the tax relief which your company clients may claim in respect of goodwill and certain other customer-related intangible fixed assets. What are the new rules and what action do you need to take? GOODWILL...

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New NI exemption for 2016/17

Apprentices. HMRC has confirmed that starting from 6 April 2016 employers will be entitled to an exemption from secondary Class 1 NI contributions in respect of wages for employees who are apprentices and aged under 25 at the time they are paid. Note. The exemption...

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Tax Question of the Week

Q. My client is a limited company. The sole director shareholder travels in a busy city centre. In order to save on travel costs the company is considering purchasing a motorbike. He is concerned that there will be a significant benefit in kind charge. Can you please...

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The end of tax motivated incorporation?

The Summer Budget 2015 contained some key measures that were a thinly veiled attack on small business owners. What do you need to be aware of? Dividends. Perhaps the most controversial announcement was the overhaul of tax on dividends. From April 2016 the notional...

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It’s P11D time!

HMRC has released its 2014/15 benefits and expenses Form P11D plus updated guidance to go with it. Is there anything new to watch out for? P11D deadline. It’s that time of year when you need to turn your attention to preparing the dreaded Forms P11D . A form is needed...

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Personal Companies – Optimal 2015/16 salary

If the director shareholder has no other income and the EA is available, the optimum position will be to take a salary equal to the personal allowance (£883.33 per month) and to withdraw further profits in the form of dividends. Although this approach will result in...

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Tax clampdown on goodwill.

Companies have been allowed to claim a tax deduction for the cost of goodwill since 2002. In the autumn Statement it was announced that this will now be restricted but when and how will this take effect? In 2002 HMRC expanded the right of companies to claim tax...

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Maximising deductions for furnishings and equipment

If you are a residential landlord and you are in the process of completing a tax return, and have expenses that include a new kitchen and replacing the washing machine in the property. Can these costs be offset against your rental income? Fixtures or furnishings? When...

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What’s the new deal on pension payouts?

In April 2015 the rules about pensions are changing to allow anyone aged 55 or over to draw the whole of their pension fund in one lump sum. Until then stop-gap measures will still apply. However there are tax consequences to the new rules. If you choose to take part...

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Avoiding late payment penalties

These days HMRC is taking a tougher line where self-assessment payments are paid late. What penalties can you expect if you don't pay on time and is there a way to avoid them if you can't afford to pay? Deadline For most people who haven't submitted their 2013/14...

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April 2020 changes to private residence relief

In July 2019 it was confirmed the government’s plans to:

  • reduce the final period exemption from 18 months to 9 months (unless special circumstances where 36 months); and
  • restrict the letting relief to cases where the owner is in shared occupancy.

Both of these changes will apply to disposals on or after 6 April 2020 and are retroactive.

As a result many landlords who once occupied a property before renting it will have a gain for an additional 9 months and no longer receive lettings relief which can be up to £40,000 and may therefore need to consider selling any properties before April 2020 where the change in the position will cause a significant increase in taxable gains once the changes come into effect.