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Small businesses / 214 posts found

Keep private bank accounts private

by mike tombs
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Many small businesses, including landlords, use personal bank accounts to lodge business receipts and make business payments. If traders in this situation are subject to a HMRC enquiry into their business affairs, HMRC would be entitled to request sight of all bank accounts that record business transactions even if those accounts are essentially, personal bank accounts.   As many of the transactions in these accounts are personal, you may need to explain to HMRC where credits to the account came from and provide evidence that the credits are nothing to do with your business.   Without this confirmation or evidence, [...]

Small Business Saturday – 1 December 2018

by mike tombs
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Did you know that there is going to be a Small Business Saturday on 1 December 2018? We have reproduced below some of the help that will be available.   Access finance available to support small businesses   Are you and your business looking to start up, scale up or stay ahead? Start Up Loans of up to £25,000 can give you a much-needed boost if you’re just starting out. Or take a look at the Finance Hub and the British Business Bankfor more finance options for smaller businesses.   Call the Business Support Helpline   The free Business Support Helpline can help businesses of [...]

New ideas from government think-tank

by mike tombs
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At the beginning of August, the Office for Tax Simplification (OTS) – a government department charged with coming up with new ideas to simplify our tax system – issued a number of reports and recommendations. They include a number of interesting topics and we have shared the conclusions below: Changes to capital allowances At present, businesses depreciate assets in their accounts and this process creates a reserve in their accounts such that when the assets are worn out, there is a fund of profits and cash to replace them. For tax purposes, this depreciation charge is added back in tax [...]

Working from home?

by mike tombs
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We are often quizzed by clients who are contemplating working from home: what are the tax consequences? And in particular, will I have to pay capital gains tax?   Capital gains tax   Generally speaking, if your business use is limited to allocating space for a home office, then as long as there is duality of use, no capital gains tax complications should arise when you sell the property. Duality of use means that your home office: doubles as a spare bedroom, or a storage space for domestic items, or is a study or has a similar non-business as well [...]

Penalties to be points based

by mike tombs
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Drivers face disqualification from driving if they accumulate 12 or more penalty points for driving offences. The resulting ban can last from 4 to possibly 11 years depending on the gravity of the offence.   HMRC seem to think that this point based system is a good idea and they now intend to include draft clauses to the forthcoming Finance Bill that will introduce a points system covering the late filing of tax returns.   In their notes attached to the draft clauses HMRC say:   The government wishes to encourage compliance with regular return submission obligations but does not [...]

Tax security deposits to be extended

by mike tombs
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We have listed below details of a forthcoming change to the taxation of companies that were disclosed in the draft clauses published last week for the forthcoming budget. The change outlined expands the rights of HMRC to demand a security deposit from “at risk” tax payers.   In their draft notes HMRC say:   HMRC can require some businesses to provide a security, in the form of cash or a performance bond, where this is considered necessary to protect the revenue. Securities may be required where a taxpayer has a poor compliance record and in “phoenix” type cases where a [...]

HMRC clarify VAT treatment of affiliation fees for sports clubs

by miketombs
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HMRC recently published a reminder that the concession enabling clubs to treat affiliation fees as exempt from VAT, will be withdrawn with effect from 1 April 2018. A sport's governing body, or similar umbrella organisation, often charges an affiliation fee to individual clubs who make an onward charge to their members. Where the clubs are non-profit making, the supply of this affiliation fee to their individual members is exempt from VAT. However, if the club is a profit-making commercial club, then the supply to their individual member is standard rated. The concession aimed to put profit-making commercial clubs in a [...]

Tax-free childcare now open to under 9s

by miketombs
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In April 2017 HMRC started rolling out tax-free childcare, a scheme designed to help working parents with the cost of childcare with up to £2,000 of support per child per year, or £4,000 for disabled children. The scheme is now open (from 15 January 2018) to parents whose youngest child is under 9, or who turned 9 on that date. All remaining eligible families with children under 12 can apply from 14 February 2018. This means that all eligible parents will have the opportunity to apply for tax-free childcare before the end of the current financial year. Parents, including the self-employed, can [...]

Latest MTD progress

by miketombs
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Draft regulations, together with a draft explanatory memorandum and a draft VAT Notice, covering required changes to the VAT regime under the Making Tax Digital (MTD) project were published for consultation in December 2017. The consultation runs until 9 February 2018, and it is expected that live pilot testing will then begin in spring 2018. With this in mind, the Association of Taxation Technicians (ATT) has recently been urging software houses and HMRC to identify MTD-compliant software packages urgently to allow businesses to make an informed decision on which to use and help to avoid the need to make a [...]

Two million couples still missing out on Marriage Allowance

by miketombs
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Recent government statistics indicate that out of four million eligible couples, around half are still not benefiting from the income tax Marriage Allowance (MA). The allowance was first introduced in April 2015, which means that a backdated claim made in 2017/18 could be worth up to £662. It's worth checking to make sure claims are made, where appropriate. In brief, Marriage Allowance is a way for couples to transfer a proportion of their individual Personal Allowance between them in a tax-efficient manner. Where a couple satisfies the following criteria, it should be possible to claim the allowance: The couple must be [...]