VAT / 21 posts found
VAT Flat rate scheme: changes take effect
The VAT flat rate scheme (FRS) is used by many small businesses to help simplify their VAT reporting obligations. Businesses could often gain a cash advantage from using the scheme, but this advantage has been significantly curtailed from 1 April 2017, particularly in relation to service-related businesses. Whilst the FRS continues to operate, many businesses will no longer find it economical to use. Broadly, the FRS is a simplified VAT accounting scheme for small businesses, which allows users to calculate VAT using a flat rate percentage by reference to their particular trade sector. When using the FRS, the business ignores [...]
February 2017 Q&A
Q. Due to unforeseen circumstances I have recently had to sell my house and down-size to a smaller property. I sold the house for £20,000 less than I paid for it. Can I offset this loss against income from my business and reduce my income tax liability for this year? A. Unfortunately the tax law does not permit you to do this. I am assuming that you are not trading in properties and the house was either your main residence or an investment asset. Losses on the sale of a principal private residence are generally not allowable losses for tax [...]
HMRC clarify pre-registration of VAT policy
HMRC have recently published Brief 16 (2016), entitled Treatment of VAT incurred on assets that are used by the business prior to VAT registration. Broadly, the brief aims to clarify when, and to what extent, VAT is deductible and what to do if the correct treatment has not been applied. A business registering for VAT may recover tax incurred on goods and services before their effective date of registration(EDR). This allows the recovery of VAT against goods and services as long as they are used by the taxable person to make taxable supplies once registered. Services must have been received [...]
The Autumn Statement 2016
This is aimed at those who didn't receive our client newsletter - that is still available at http://eepurl.com/cqcb0b. If you do read them both, let me know which version you prefer:-) Summary Chancellor Philip Hammond has delivered his Autumn Statement 2016, which is the first major review of government finances since the EU Referendum, and Mr Hammond's first major statement since taking responsibility for the work of the Treasury in July 2016. As previously speculated, this will be Mr Hammond's only Autumn Statement as it was confirmed that the government is to move to a single major fiscal event each [...]
October 2016 Q&A
Q. I have recently started a new job and, for the first time in my career, I have been provided with a company car. I have to pay for fuel for private use but my employer says I can claim mileage for business journeys. Will I have to pay tax on fuel payments? A. In addition to the company car benefit charge, employees have to pay tax on any fuel their employer provides that is used for private mileage. For 2016-17 you would calculate this amount by multiplying the car's CO2 percentage by £22,200. So, if the percentage is 28, [...]
EU consultation on ending VAT on eBooks
The future of the chargeable rate of VAT on digital publications and eBooks is under review as the European Commission (EC) has launched a two-month consultation with a view to abolishing the current full rate VAT. Member States currently have the option to tax printed books, newspapers and publications at a reduced rate (minimum 5%) and some Member States were granted the applications of VAT rates lower than 5% (super-reduced rates) including exemptions with a deductions right of VAT at the preceding stage (so called zero rates) to certain printed publications. Digital publications that are electronically supplied have to be [...]
September 2016 Q&A
Q. I have recently changed jobs and need to use my car to make business journeys. Will I have to pay tax on the mileage expenses my employer reimburses me for these trips? A. Employers can pay employees a tax-free and national insurance-free amount for every mile they drive on business duties, currently: 45p per mile for the first 10,000 miles 25p per mile for each subsequent mile 24p per mile for motorcycles 20p per mile for bicycles 5p per mile extra for each passenger carried on work-related journeys If your employer reimburses your mileage at less than these rates, [...]
HMRC go live with Verify identity authentication
Gov.uk Verify, the online service taxpayers will need to use to prove their identity before accessing HMRC's digital services and other government online services, is now live. The central government platform for online identity assurance has been under development for some time by the government digital service (GDS) and has been available in a beta version. It has now passed its service assessment. It should take around ten minutes for an individual to verify their identity the first time they use gov.uk Verify, and a couple of minutes any time after that. Individuals choose from a list of companies certified [...]
New credit card payment fees take effect
Clients may be interested to know that HMRC have introduced a new schedule of fees, which apply from 1 April 2016, and replace the former 1.5% fee. The new rates vary depending on the type of card used and whether the card is a personal or corporate card. Broadly, the fees for paying using personal credit cards have been reduced and the rates for corporate credit cards have increased. The new rates can be found in the schedule to The Fees for Payment of Taxes, etc. By Credit Card Regulations 2016 (SI 2016/333). For personal credit cards, the fees are [...]
March 2016 Q&A
Q. What are the implications of selling my Scottish home? I own and live in a property in Scotland. What are the implications of me selling the house to a relative, who will buy it using a buy-to-let mortgage, and allow me to stay in it and pay rent to her as a tenant? A If the house has always been your main residence, there should be no capital gains tax implications for you. Depending on the purchase price, your relative may have to pay the Scottish land and buildings transaction tax (LBTT), which replaced the previous stamp duty land [...]