Articles in the annual Category
Since the introduction of the Dividend Allowance and the Interest Allowance in 2016, compounded by the new Scottish rates of tax in 2017, there is no easy way to work out the optimum pattern of salary and dividends for directors of small UK companies.
Here’s a rough guide to what you might want to pay yourself and what sort of personal income tax reserve you may need to keep. Remember, that this is in addition to your company preparing its own corporation tax reserve. A company can only pay dividends from …
There is no specific tax deduction for a “Christmas party” but HMRC does allow a measure of tax relief for “an annual event”.
Generally, staff entertainment is considered as a “Benefit in Kind”, and directors and employees need to pay tax and national insurance on the amount of the benefit.
Here’s the one way to avoid a “Benefit in Kind”. As a company director, you are entitled to provide an annual event for yourself, any staff you employ, and your partner, and reclaim the costs against the company. Proved that the cost …
In the good old days there was an easy way to work out the optimum pattern of salary and dividends for directors of small UK companies. With the advent of the Finance Bill 2016 the situation has become hopelessly complex and that prompted AccountingWeb to publish a critical blogpost. Here’s the first bit with the all important table:
If you want to see the blogpost in full you’ll have to sign up for membership of AccountingWeb. It’s a free resouce for accountants!
And, as we said in our 30 Nov 2015 blogpost, …
The new Marriage Allowance is set to come into force on 6 Apr 2015 when the new tax year starts. It was announced in last year’s Budget when David Cameron and George Osborne made a big deal about it . . .
Prime Minister David Cameron: “I made a clear commitment to the British people that I would recognise marriage in the tax system.”
Chancellor of the Exchequer George Osborne: “Our new Marriage Allowance means saving £212 on your tax bill couldn’t be simpler or more straightforward.”
However, it is not as simple …
New rules governing the entitlement to child benefit come into force on 7 Jan 2013.
Until now, child benefit has never been means tested and has always been paid to the mother of the child. If your household income exceeds £50,000 then the chances are that the child benefit will be clawed back from you, in stages, so that by the time your household income exceeds £60,000 the whole amount of your child benefit may be reduced to Nil.
The rules (as you might expect) are not quite as simple as that, …
Nobody wants their accounts to be late, and nobody wants to be fined as a result.
In that respect we are just the same as you, but there is one fundamental difference!
In law the responsibility remains with you, the taxpayer, to get things done. And unless you can show reasonable excuse, then if your accounts are late and you get a penalty notice, you are the one who is going to have to pay it. Saying that “my accountant didn’t remind me” is not a reasonable excuse, and in any case …
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Approval of accounts
In the old days traditional paper accounts were sent out by post, for approval and signature. Nowadays, HM Revenue & Customs will accept authorisation electronically and that speeds things up. That means that we now prepare PDF files and email them to clients:
4xx600 report – full accounts
4xx610 report – abbreviated accounts (Limited Companies only)
4xx770 report – adjusted profit for tax purposes (businesses only)
Please check the PDF files which you receive, because they are based on the records …
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This article is a sub set of the Annual Accounts Checklist
Please read this article in conjunction with the annual accounts checklist. If you are a Sage user, then the steps you need to follow on your Menu are set out below. This summary was originally prepared in 2006. If you have a later release of Sage and we need to update this advice please let us know.
We prefer Adobe files with a PDF suffix from Sage.
Ensure that you are …
It’s normal for some people to make tax payments on account every 6 months
If you’re self employed, or have lots of income from rent, dividends or investments, you may have become used to the pattern of making tax payments every 6 months.
However, the way the rules are structured, it normally comes as a bit of a surprise the first time you encounter the the “payments on account” regime. PoA for short. If most of your tax is paid under PAYE you won’t need to worry about this. The rule is …
There are four methods for paying a tax bill
We recommend making payments by bank transfer as this is the most assured way of proving the date and the amount of the tax you have actually paid.
Method 1 – Internet Banking
Make a payment to the Collector of Taxes for the amount required. Depending on the bank, they may already have HMRC Shipley or HMRC Cumbernauld as ready made options, and you should use the Shipley account unless told otherwise. If the bank does not have the precise account details already on …