News Archives - Page 16 of 44

Tax Planning for Clearing Overdrawn Director’s Loan Accounts

Directors of owner-managed and family companies invariably have a director’s loan account (DLA) where transactions between the director and company are recorded. At the end of a company’s accounting period, the DLA is usually cleared via a salary allocation (assuming the director is not a salaried director), bonus, dividends, expenses, reimbursements (e.g., company bills paid

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Yes, But What About the Trade Benefit?

News / James

A company purchase of own shares (POS) has always seemed to me a bit of an oddity for tax purposes. The consideration paid for the buy-back is a distribution for both company law and income tax purposes, like a dividend. However, if certain tests (at CTA 2010, ss 1033– 1042) are met, we pretend that

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New Employees, NICs and Mistimed Payments

News / James

It is a reality for payroll departments that, sometimes, they are not always advised of a new starter until after payroll cut-off. Operationally (and depending on the values involved), they will pay the amount due but not paid as backpay in the following pay period, together with the employee’s regular salary. ‘Mistimed’ Payments HMRC and

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The Introduction of VAT on Private School Fees

News / James

Prior to the 2024 general election, the incoming Labour government had announced its intentions to introduce VAT on private education. An announcement to this effect was subsequently made to Parliament by the Chancellor on 29 July 2024 and the publication of Revenue and Customs Brief 8 (2024). When Does It Apply? The implementation date for

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Rental Properties: Tax Issues

News / James

The past few decades have seen a substantial increase in the number of property owners who let one or more houses to tenants, driven in part by relaxations in lending, rising property prices and some tax advantages. At the time of writing (i.e., before the autumn budget on 30 October 2024), the question is whether

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Uneducated Guesswork!

News / James

Taxpayers are required to notify HM Revenue and Customs (HMRC) of their liability to tax within certain time limits, such as where the taxpayer first becomes liable to pay tax, or conducts (or intends conducting) a business that needs to be registered with HMRC. Failure to notify HMRC of chargeability to tax can happen for

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Profit Extraction: Some Traps to Avoid

News / James

When a company has been incorporated, the first thought by the owner is often how one pays oneself. Proper remuneration planning can help mitigate the effects of perceived double taxation of corporation tax for the company and personal tax for the shareholders or directors. Dividends Vs Salary The usual method of extracting profit is to

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Connected Employers: Employment Allowance Implications

News / James

Several tax implications can arise due to the relationship between the companies, particularly affecting corporation tax, VAT, group relief, and transfer pricing, as well as having an impact on the PAYE employment allowance (EA). EA reduces an employer’s National Insurance contributions (NICs) liability by up to £5,000 per tax year. Importantly, no claim can be

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A Little Knowledge is A Dangerous Thing!

News / James

I am always amazed by the number of people who undertake high value transactions without getting proper advice about the tax consequences. A classic example arose recently in Arshad Mahmood v Revenue and Customs [2024] UKFTT 114 (TC). The Key Facts Arshad Mahmood [M] transferred ten commercial properties to a company owned by his wife.

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When is A Nursery Not a Nursery?

News / James

To avoid a benefit-in-kind (BIK), the provision of childcare has two tax exemptions (inserted into ITEPA 2003, Ch 4): Employer-supported childcare, possibly provided by way of a childcare voucher and often via salary sacrifice. ITEPA 2003, s 318A outlines the limited exemption of up to £55 per qualifying week. This exemption from tax and National

When is A Nursery Not a Nursery? Read More »

News

Tax Planning for Clearing Overdrawn Director’s Loan Accounts

Yes, But What About the Trade Benefit?

New Employees, NICs and Mistimed Payments

The Introduction of VAT on Private School Fees

Rental Properties: Tax Issues

Uneducated Guesswork!

Profit Extraction: Some Traps to Avoid

Connected Employers: Employment Allowance Implications

A Little Knowledge is A Dangerous Thing!

When is A Nursery Not a Nursery?

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