Insights

Making Tax Digital starts on 1 April – Are you ready?

Question.   I run a small business and I have received a letter from HMRC about Making Tax Digital for VAT and a deadline of 1 April. What do I need to do?   Answer.   The countdown is on until the UK Government’s digital tax reporting system, Making Tax Digital, opens for VAT-registered businesses on 1st April 2019.   The Making Tax Digital (MTD) initiative is designed to bring the UK’s ...

The complexities of Entrepreneur’s Relief

Question.   I want to transfer some shares in my trading business to my sons while ensuring that all the shareholdings remain tax efficient if the company is sold in the future. In particular, I want everyone to benefit from entrepreneur’s tax relief if we sell the company, so that we all only have to pay 10% capital gains tax. Are there any conditions I need ...

What you need to know about the new payslip legislation

Question.   I own a small business with six employees who are paid weekly. At present I do not provide them with any payslips and have heard that new legislation is coming into force soon. Can you advise me what this is and what I need to do?   Answer.   On 6 April 2019 HMRC is introducing new legislation which covers the provision of payslips to employees. The main features ...

Correcting errors on previous VAT returns

Question. I prepare and complete the quarterly VAT returns for my small business and noticed recently that I had made some errors in previous returns. Can you advise how I correct these, and will there be any penalties or interest to pay on this? Answer. If you’ve made a mistake on a previous VAT return, it’s important that you take the right steps to remedy this, or you ...

What to do if you missed the tax return deadline?

Question.   I failed to submit my tax return by 31st January as I was ill in hospital. I have only recently returned to better health and I am concerned about missing the filing deadline. What can I do?   Answer.   The deadline for filing your 2017/18 self-assessment tax returns was 31st January 2019. You will be issued with an automatic, initial penalty of £100. After a 3 month ...

Crypto Currency – Tax Relief on Losses

Question.   I invested in crypto currency during 2018 and I sold my holding at a considerable loss. Am I able to obtain any tax relief on this loss?   Answer.   Recently published revenue guidance has confirmed that losses incurred on selling crypto currency holdings are eligible for capital gains tax relief. Initially when the crypto currency bubble started, some people were of the misunderstanding that they were in ...

What’s your is mine – taxing jointly held assets

Question.   I own some residential properties with my wife and I would like to give her some of the income as she no longer works. Can I do this?   Answer.   There are a few quirks married couples and civil partners with joint assets need to be aware of when it comes to the way any income arising on those assets is divided between them for income tax purposes.   The ...

Firm foundations for a new tax relief

Question.   Can you explain to me the new capital allowances relief announced in Budget 2018?   Answer.   One of the few surprises in Budget 2018 was the introduction with immediate effect of a new class of capital allowances – Structure and Buildings Allowances (SBAs). In outline, SBAs will provide relief on a straight-line basis for qualifying expenditure on new non-residential structures and buildings incurred on or after 29 ...

The dividend versus bonus debate

Question.   I’ve decided to pay my employees and shareholders a January bonus or a dividend as a thank you for all their hard work in 2018. Given the tax advantages of dividend payments I’m wondering whether I should be considering bonuses at all or whether I should just pay everyone a dividend? Are there any pitfalls in paying dividends instead of bonuses?   Answer.   The dividend versus bonus debate ...

The tax minefield of giving a property to my daughter

Question.   A few years ago, my wife and I bought an apartment in Belfast for my daughter to live in. As she was only just starting work we bought it in our names. We would now like to transfer it into her name when the five-year fixed period for the mortgage completes, so that she can take it on in her own name. Will there be ...