Tax / 38 posts found
Spring Budget 2023 – the key points for business owners
The Chancellor, Jeremy Hunt, delivered his first Spring Budget on 15 March 2023. Unlike the disastrous September 2022 ‘mini budget’, this budget won’t cause many ripples in the worlds of business and finance. In fact, it was a relatively dull affair, with few headline announcements for the average business owner to be concerned about. However, there were some incentives regarding capital allowances on equipment and investment in research and development (R&D), to help push the economy forwards. Summary of the main Budget announcements Whereas the primary aim of the Autumn Statement in November 2022 was to address the financial instability [...]
Should you choose a company van over a company car?
Having a vehicle to use for business purposes adds to the efficiency of your business. But should you opt for a company car or a company van? Company vans are taxed in a far more favourable way than passenger cars, in most cases. Both company tax relief and personal benefit-in-kind tax charges are more tax efficient for vans and, partly because of this, many business owners choose a van over a car. What personal tax do you pay on a van compared to a car? Personal tax for use of a company car is charged on an annual amount of [...]
How the increased minimum wage will affect your business costs
Business costs are on the rise as we near the second quarter of 2022. Supply chain costs are increasing, energy prices are rising and labour costs are getting more expensive. These soaring costs mean higher expenditure and lower margins on your products and/or services. If left unchecked, that could mean a dip in your predicted profits for the quarter. The good news is that by acting now to manage these increases you can stay on top of these costs. And with a proper financial plan, you can keep your business turning a profit. A rise in the National Living Wage [...]
Are home to work travel costs ever allowed?
Ordinary commuting between home and work incurs costs: either shoe leather, if you walk, or the cost of transport. For most employees these costs are considered to be personal costs and are not deductible for tax purposes. This is so even if your employer requests that you attend out of hours, say the weekend. According the HMRC: If an employee is sometimes required by his employer to attend their permanent workplace outside normal working hours, often at the weekend. This may mean that they incur extra costs on bus fares, meals eaten at their desk and sometimes even [...]
Have you received your tax statement?
HMRC normally send out a tax statement this time of the year to all self-assessment taxpayers that have submitted a tax return for 2017-18. As we reported last week, this will list any balance of tax due for 2017-18 and the amount of any payment on account required for 2018-19 (if any is due). Both amounts will need to be settled on or before 31 January 2019 to avoid interest and possible late payment penalties. If you don’t receive a statement, but you know how much you need to pay, simply organise an online bank payment to: HMRC Cumbernauld – [...]
Taxing dividends
To reduce National Insurance costs, shareholders of small privately owned companies, who are also working directors of the company, can presently restructure their remuneration package to reduce their salary and make up the difference as dividend payments. Unless this strategy is affected by the Budget at the end of this month, this remains one of the most useful ways for owner directors of small companies to reduce their overall tax and NIC costs. Dividends are not considered to be a business cost. They don’t reduce the amount of profit assessable to corporation tax. Rather, dividends are a distribution of profits [...]
Exclusivity and tax relief
In order to qualify as a deduction for tax purposes we have to demonstrate that the expenditure was incurred “wholly and exclusively” for the purposes of our business or employment. We will also need to consider a further criterion: where the expenditure has a duality of purpose. In a 1980’s case, a barrister claimed for the cost of business suits which she insisted were only used for business purposes. To her delight, the lower courts agreed, but HMRC were having none of it and pursued their case to the House of Lords where the taxpayer’s claim and appeal was dismissed. [...]
Boosting recycling through the tax system
The government has announced that it has received record-breaking support from members of the public to counter the blight of plastic waste. Here’s what they said: Individuals, businesses and campaign groups have expressed overwhelming support for action on tackling the impact of plastics on our environment. The backing comes as HM Treasury publishes the summary of responses to its recent call for evidence on how tax can be used to reduce plastic waste. The call attracted an unprecedented 162,000 responses, the highest in the Treasury’s history. The Chancellor, Philip Hammond, has reiterated the department’s commitment to act through the tax system [...]