Michael Sohor & Co is now known as Tamen Accountants. This is a name change only - we are the same dedicated team, and look forward to serving our valued clients for many years to come.
Do I need to do anything if I sell a residential property?
If you sell a residential property, resulting in Capital Gains Tax liability, this must be reported to HMRC within 30 days of the completion date. This is a new requirement since 6 April 2020. This must be reported online to HMRC by the taxpayer. Failure to report in the 30 day time frame, and pay the Capital Gains Tax due, will result in a penalty.
What can a company group structure do for me?
A group of companies exists when one company, normally called a “holding company” owns one or more subsidiary companies. The advantage of such a structure is normally ring-fencing of risk within trading subsidiaries, as well as the possibility of protecting surplus funds within a holding company. We are able to advise on the suitability and implementation of such a structure in appropriate cases.
Am I affected by IR35?
If you’re a contractor or freelancer operating through a limited company, you might be affected by IR35. The rules on this have changed recently so that it is now the end client (if they are a medium or large sized company) who is responsible for determining the employment status of any contractor. Determining IR35 status is not always straight forward and there are numerous factors which can affect the decision. Our advice would depend on your individual situation.
What is the Domestic Reverse Charge for VAT?
This measure was introduced on 1 March 2021 in an attempt by HMRC to prevent VAT fraud. Supplies are within the scope of DRC if the work is within the scope the CIS scheme, and the customer is not the end user. For further guidance, see our downloadable guide on the DRC.
Can I get any tax relief on a used commercial property?
You might be able to claim capital allowances on what is known as the “integral features” of the property. Generally, these are the hot and cold water systems and main wiring within the property. Other items are rarely seen in practice. This is a complex area and advice must be tailored to your situation.
If I buy a second home, is there anything I should do now with regard to future Capital Gains Tax plaget any rnning?
You have 2 years from the date of acquisition of a second home to nominate it is your principle private residence (PPR). Currently the last 18 months of your ownership of a property which you have lived in as your “PPR” are exempt from Capital Gains Tax. Lettings relief is all but gone now, with only periods where you co-habited with your tenant qualifying for lettings relief.
Is it better to be a sole trader or a limited company?
Generally, there is a tax advantage for businesses operating though a limited company because the rate of Corporation Tax paid by companies is lower than the rate of Income Tax and National Insurance paid by sole traders. However, a limited company comes with various complications which means this option not right for everybody. Our advice will be tailored to your individual situation.
Can I claim expenses for working from home?
Yes, you can. The simplest method is to use the HMRC approved rate of £6 per week which is £312 per year. If you want to claim more than that, then you need to work out the actual proportion of your expenses which relate to business use. That means you must work out the proportion of your own home which is devoted to office use and apply that proportion to your usual household bills. Bills which you could claim for include items such as council tax, mortgage interest, insurance, gas and electricity.
How do I employ someone?
To pay an employee you must set up a payroll scheme which is registered with HMRC. You must ensure that the employee is paid at least the statutory minimum wage and you are responsible for making deductions for Income Tax and National Insurance, if appropriate. You must also set up a workplace pension scheme if your employees earn enough.
Should I get a company car or not?
It depends on the type of car you are considering. Generally, cars which run on petrol or diesel alone are not worth running though a company; the benefit in kind (BIK) tax is too expensive. Hybrid cars and pure electric cars are very tax-efficient, and therefore might be worth putting though a company. However to benefit from the most generous tax deductions in your company the car must be new and unused and 100% electric. This means a significant financial commitment.
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Chartered Tax Advisors
Our tax experts we can make sure all your tax returns are filled out and submitted in the most efficient way. Get in touch to find out more about our tax return services.