Tax Issues Archives - Page 10 of 13

Budgets & Other, Tax Issues, Tax Saving Tips, Taxation

Second Job Tax: How to Pay Tax on Second Job

George / 20/04/2022

Wondering about second job tax and how it might affect your income? If you’re thinking about taking on a second job, it’s important to understand how taxes work—so you don’t underpay or overpay. Whether you’re doing it for extra income, to support your household, or simply because you enjoy it, knowing your tax responsibilities will help you avoid surprises. Let’s explore the basics, how much tax you pay, and how to stay on top of it all. The Basics: Can I Take a Second Job? Before you start working a second job, consider these important points: Check your current employment contract. Some employers include clauses that restrict taking up additional employment, especially in similar industries or if it might affect your performance. Understand the working hours. Taking on more hours may affect your wellbeing or work–life balance. You must be paid at least the National Minimum Wage in both jobs. There’s no law stopping you from having a second job, but make sure it doesn’t breach any of your primary job’s terms and conditions. How Much Tax Do I Pay on a Second Job? In the UK, HMRC considers your highest-paying job as your main job and applies your personal allowance (£12,570 for 2025/26) to it. Your second job is usually taxed at the basic rate (20%) from the first penny you earn, as it doesn’t get any personal allowance. This is done using a tax code—typically: BR (Basic Rate – 20%) D0 (Higher Rate – 40%) if your total income is above £50,270 D1 (Additional Rate – 45%) if your total income is above £125,140 Example: If you earn £10,000 from your first job and £6,000 from your second job: Your first job will be tax-free (under personal allowance). Your second job income will be taxed at 20% using BR code. If your total income from both jobs pushes you into a higher bracket, HMRC may change your second job tax code to D0 or D1. How to Avoid Underpaying or Overpaying Tax To stay accurate: Tell HMRC when you start a second job so they can assign the correct tax code. Provide a P45 from your first job or complete a starter checklist for the second job. Check your tax codes on your payslips. Your main job should have a code like 1257L, and your second job should have BR, D0, or D1 depending on your income level. Review your income regularly to ensure you’re not pushed into a higher tax bracket unknowingly. Can I Split My Personal Allowance Between Jobs? Yes—but only if your total income from both jobs is below the personal allowance (£12,570). You can ask HMRC to split your personal allowance across both jobs so you don’t overpay tax. You’ll need to contact HMRC to arrange this. National Insurance (NI) on a Second Job You also need to consider National Insurance contributions: You pay NI separately on each job. If you earn more than £242 a week in either job, you’ll pay Class 1 NI at 12% (for earnings between £242–£967). If you’re self-employed for one job, you’ll pay Class 2 and Class 4 NI through Self Assessment if profits exceed £1,000 per year. What If My Second Job is Self-Employed? If your second job is freelance or self-employed: You must register for Self Assessment with HMRC. Submit an annual tax return by 31 January. Pay tax and National Insurance (Class 2 and 4) based on your profits. Even if your self-employed income is less than £1,000, it’s good to keep records and check whether you’re eligible for the trading allowance. Conclusion Now that you understand how second job tax works in the UK, you’re in a better position to plan your finances. The most important things to remember are: Inform HMRC as soon as you take on a second job. Watch your tax codes and total income to avoid overpaying or underpaying. Consider the impact of National Insurance and higher tax brackets. Need Help with Tax Codes or a Second Job Setup? We advise on personal tax, prepare tax returns for sole traders and directors, and help you manage your PAYE jobs correctly. Our accountants in Croydon are happy to help. Disclaimer The information in this article is for general guidance only. It does not replace professional advice tailored to your circumstances.

Accounting Issues, Sole Trader, Tax Issues

What is Payment on Account? A Simple Guide

George / 10/01/2022

As a UK taxpayer, if you’ve submitted your tax return, you can check out your self-assessment tax bill to know: what you owe to the HMRC? How you will pay that amount to HMRC? When you will pay it? To find out, you need to understand ‘Payment on Account’. If you have paid below 80% of your tax at source (like via PAYE) and your tax bill is over £1,000, HMRC may ask you for payment on accounts. Let’s learn: What is POA? How to calculate POA? What if your income is smaller or higher next year? How to check the amount you owe? Is POA optional? If you want a professional accountant and bookkeeper for your company, we can help you. Our bookkeepers and accountants at CruseBurke are qualified and cost-effective. We save your time, money, and stress by handling all your finances and business problems in no time. Contact us now! Understanding Payment on Accounts If you pay the tax bill via self-assessment, you may be required to make tax payments twice a year (two instalments) to spread the cost of the next year’s income tax, this system is known as payment on accounts. It is calculated based on your previous year’s tax bill and settles the tax you owed from the tax return. The amount you pay for each POA will be half of your previous year’s tax bill. POA means you pay tax in two instalments: In January (deadline to pay tax bill) And in July In case, if you have already paid over 80% of your tax bill in January, you don’t need to worry about POA as you will not be charged again in July. How to Calculate Payment on Accounts? POA is calculated based on the previous year’s tax bill about your future income. It will then be paid in equal instalments, so it means that the half payment will be made in January and half in July. Suppose if you have a £2,000 tax bill for this year, you’ll be paying POA in two instalments totalling £2,000 for the upcoming year’s tax bill. It assumes that you will make roughly the same income or more that you did last year. If you make the income more and your tax liability increase, in such case you just pay off the balancing amount on 31 January. What if Your Income is Smaller or Higher Next Year? If your income is smaller next year, you may contact HMRC to bring down your payment. You can do it through: HMRC online account and click on “Reduce Payments on Account” print and post the SA303 form to your HMRC However, it is recommended to pay the POA as it is. If HMRC found that your profits are down, the difference would be refunded by HMRC. In contrast, if your income is higher, you need to make a balancing payment by 31st January next year to update your account. We can register you as self-employed to HMRC on your behalf. Fill out this form and let us handle everything. Call us on 020 8686 8876 or email us today! How to Check what you Owe? To check it, you first need to sign in to your online account. Then, you need to click the view statement. There you will find: the payment you made before your next paments Is Payment on Account Compulsory for Self Assessment? POA is not optional rather it is mandatory, once you are done submitting your Self Assessment tax return, you’ll be automatically enrolled in it. You may not be enrolled if: you’ve already paid 80% over of the total tax amount you owe (like via PAYE) your tax bill from Self Assessment was under £1,000. Quick Sum Up We hope that after giving it a read, you have now got a basic understanding of what is payment on accounts, how to calculate it, what if your income is smaller or higher next year, how to check what you owe, is POA optional. Payment on account is the system to pay the tax bill in two instalments, first in January and second in July. Generally, self-employed make this payment as an additional self-assessment tax payment. Turn to us if you need any help with accounting, tax payroll, and other finance-related problems! We will solve you are all your business issues in no time and at an affordable price! So, contact us now! Get an instant quote from our accountants for the services you’re looking for! Disclaimer: This blog contains general information on POA.

Tax Issues, Tax Saving Tips, Taxation

How to Avoid Capital Gains Tax on Gifts?

George / 03/01/2022

If you are wondering how to avoid capital gains tax on gifts, you’re in the right place. You might have heard this many times that gifting a property will cut down or eliminate the capital gains tax. But this assumption is not correct with every person to whom you gift. As the gift should be only given to a specified person or organisation to avoid CGT. In this quick post, you’ll learn what is CGT, and how to avoid it. So before discussing how to avoid capital gains tax on gifts, let’s start with when you actually need or needn’t pay capital gains tax. If you are stuck with accounting or tax issues, particularly the CGT? How about speaking to us via a call. We love talking about taxes, payroll management and any opportunities that help you expand your prospects. Call us on 020 8686 8876 or email us today. Understanding Capital Gains Tax (CGT) Capital gains tax or CGT is the tax levied on the profit when you sell or dispose of any asset that has increased its value since it was bought. CGT is only payable on the gains you made not on the amount you receive while selling or disposing (or gifting) of any assets. You don’t need to pay CGT on the assets that are non-taxable and if the gains you made are below the tax-free allowance in a year. When Do You Need to Pay CGT? Here are the circumstances where you need to pay CGT on the gain when you sell or dispose of: a property that is not your main residence or home shares that are not in ISA or PEP assets of your business most personal possessions worth £6,000 or more, apart from your car your main home if you’ve rent it, used for business or it’s very large The assets listed here are all considered chargeable assets. When You Don’t Need to Pay CGT? In addition to the gain on the non-taxable assets, you don’t need to pay CGT on gains above any tax-free allowance (£12,300. £6,150 for trusts). Furthermore, when you gift something to your spouse, civil partner or a charity, you are not required to pay this tax. Let’s dig deeper into it. Find out: CGT rates here! How to Avoid Capital Gains Tax on Gifts? Here are some ways to avoid capital gains tax on gifts: Use your CGT allowance of £12,300 (2021-22) Offset against losses over gains Transfer your assets to spouse or civil partner Contribute to a pension Gives shares to charity Use your annual ISA allowance Reduce your taxable income Spread gains over tax years Invest in small companies Have a query or need more help? Get help from our accountants to find out how to avoid CGT! CGT on Gifts to Your Spouse The gifts you made to your spouse or charity are exempted from capital gains tax. It means that you don’t pay Capital Gains Tax on those assets you sold or gifted to your spouse or civil partner, unless: you gave them goods for their business to sell on you separated or divorced and did not live together at all in that tax year However, your spouse or civil partner need to pay tax on the gain if they further sell or dispose of the asset. You can work out the gain by subtracting the value of a first owned asset with their value when they’re disposed of or sold. You also need to keep records of the documents as evidence. Gifts Made to Charity Assets that are sold or disposed of to the charity are exempted from CGT. If you fall within both conditions, you may be liable to pay if you sell an asset to charity: less than market value more than you paid for it Calculate your gain according to the amount you are paid by the charity, rather than the asset’s actual value. Quick Sum Up Hopefully, you have got a basic overview of what is CGT, when it is taxed, when you don’t need to pay it and how to avoid capital gains tax on gifts. So, by using the above tips, you can save thousands of pounds. With careful planning and by taking the help of our accountant, you can reduce your CGT effectively without getting into any tax avoidance or evasion. Contact us right away! Our accountants at CruseBurke are qualified and cost-effective! We save your time, money, and stress by handling all your CGT issues! So, allow us to do this at an affordable package! Disclaimer: This blog is just written for general information and should not be taken as expert financial advice in any form.

Tax Issues, Taxation, VAT

What are the Benefits of Being VAT Registered?

George / 23/11/2021

When setting up a new business, some people may think that it is necessarily important to register for Value Added Tax (VAT). But, you need to know that it is not mandatory to register, provided that your VAT taxable turnover is over £85,000 (VAT threshold). However, even if your annual turnover is below the threshold, you can still register for it voluntarily as it comes with a lot of advantages. There are a lot of benefits of being VAT registered. As it helps your new or emerging business to appear more professional and stable in the business world. So before we delve into the benefits of being VAT registered, let’s see what is VAT? Want to register for VAT? We’ll take care of everything from scratch to acquire your VAT number. So, fill out this form and leave the rest on us! What is VAT? VAT, Value Added Tax is a consumption tax on products and services collected by businesses on HMRC’s behalf. All businesses having a VAT taxable turnover of over £85,000 need to register for it. For businesses that are VAT registered, VAT is charged on the majority of all goods and services they provide. In addition, this tax is also charged on the goods and services imported from EU or non-EU countries. This tax is added to the sale price of things sold to commercial and non-commercial businesses. Businesses that are VAT registered can claim back the VAT paid to their suppliers or other businesses. Now let’s see the benefits of being VAT registered! Benefits of Being VAT Registered This question is often asked by many new businesses that why there is a need to register for it if their turnover is below the VAT threshold. There are many advantages of doing so as it has a lasting impact on the financial health of your business. There are a lot of benefits of being VAT registered: Improve Your Business’s Credibility To appear an established business and to improve your perception, you should consider registering for VAT voluntarily. As many businesses know that £85,000 is the VAT registration threshold. If your business is not VAT registered, your competitors will know that its turnover is lower than the VAT threshold. So, it is a great way to improve business credibility and to appear a large business in the eyes of your clients and competitors. Access to VAT Registration Number By registering for VAT, you can display your VAT registration number on all the business documents, and its website to show the public that you are a VAT registered business. It improves your credibility and provides others with a trustworthy image of your business. Increased Cash Flow One of the other benefits of VAT registration is better cash flow. Once your business is VAT registered, you can claim back your VAT costs. The higher your set-up costs, the more you can claim them back. All the costs you put in on your business like getting stocks, investing in technology, or getting professional services, so getting these costs back can be a life-saving step. Claiming VAT Refunds Your business will be able to reclaim the VAT that you paid for. If your input tax (VAT paid) exceeds the output tax (the VAT you charged), you can claim the difference from HMRC. When you invest in buying machinery, plant or equipment, you can reclaim a large amount of VAT. While submitting your VAT return, you may find that you can reclaim a lot from the HMRC. Need professional advice from a VAT accountant? Get in touch with our experts today! Reclaiming VAT from the Past Once you are registered for VAT, you can get the advantage to claim VAT for the last 4 years on the things you still use. To do it, you need to be VAT registered for a considerable time and keep all the records, invoices and receipts of the past 4 years. More Work Opportunities Many investors, buyers, lenders, and clients prefer to work with VAT registered business. So by registering, you will open doors to more business opportunities to widen your business spectrum. Quick Sum Up Now that you are well aware of the benefits of being VAT registered, you can improve the position of your business by registering for VAT. You can register for it directly on HMRC’s website or by filling out the VAT1 form. However, the process can be daunting, therefore allow us to register your business for VAT to avoid the hassle. Register For VAT today!!! CruseBurke offers inclusive VAT services at a reasonable price! Contact our qualified VAT accountants and sort out your VAT issues in no time! Get an instant quote right away! Disclaimer: This blog provides general information on the benefits of being VAT registered.

Tax Issues, Tax Saving Tips, Taxation

How to Avoid Emergency Tax? A Basic Guide!

George / 07/10/2021

When you start work and fail to provide accurate and complete details to your employer, he will deduct the emergency tax from your paycheck. In addition to that, you will also pay an emergency tax on your pensions. So, read this blog to know how to avoid emergency tax and stop paying this. Reduce your business burden by letting us manage & record your finances! Our team could help you claim what is rightfully yours! So, Contact us now! What is an Emergency Tax? It is a tax that is charged by HM Revenue & Customs to your salary. It is charged when HMRC does not have enough details about your income and tax for a year. The other reasons for paying an emergency tax are as follows: If, after being a self-employed person, you have started working for an employer. If you have started a new job. If you have started getting benefits or state pension. How to Know if You are On an Emergency Tax Code? In order to know whether you are on an emergency tax code, check your payslips. HM Revenue & Customs will charge you emergency tax if your payslip contains any following tax codes. 1257 W1 1257 X 1257 M1 What is the 1257 Emergency Tax Code? Within the United Kingdom, almost everyone is authorised to a tax-free personal allowance. It means that a specific amount of your profits is paid to you every year without any tax charged on it. You will be provided with a tax-free allowance which currently stands at £12,570 if your tax code is 1257. It means that you will pay tax on anything above this threshold. This is because HM Revenue & Customs turned in the personal allowance of £12,570 into this tax code. Therefore, it simply means that you can earn £12,570 before paying tax if you have this tax code. How to Avoid Emergency Tax? The simpler way to avoid this tax is to provide a P45 or information about your previous income and tax payments to your employer. This information will tell about your paid tax in the last job to the new employer. Then, he will inform HMRC about these details. HMRC will send a Pay As You Earn (PAYE) coding notice to provide the correct tax code to your new employer. Then, on the recent payslip, this new tax code will appear from your employer. In case you do not have a P45, your employer will have to complete a Starter Checklist. This will assist your new employer in allocating a tax code to you that will be forwarded to HMRC. How Much Will You Pay in the Emergency Tax? This totally depends on your earnings and emergency tax code. It implies that you will be taxed on anything above your basic personal allowance (£12,570). Your personal allowance will not be taken into consideration if you have the BR code. You might pay up to fifty percent of your salary as an Emergency tax (the max it can be). Therefore, it is better to prevent emergency tax as you have to pay a high amount of tax. What is the Method to Prevent the Emergency Tax? You can stop paying emergency tax by the following method. The emergency tax code may imply that you have overpaid tax in the past; in this case, the HMRC will refund any overpayment of tax. You can call HM Revenue & Customs directly in case you have been working with your new employer for above three months and still paying the emergency tax. Final Thoughts After knowing about how to avoid emergency tax and the method of not paying an emergency tax, we will conclude our blog by saying that HMRC will charge you emergency tax if you fail to provide your new employer with your income and tax details. However, in order to avoid paying an emergency tax, it is crucial to provide these details. You can also claim back overpaid taxes, although avoiding emergency taxes is better. Turn to CruseBurke for managing finances and for claiming overpaid taxes! We have a team of skilled accountants who will handle everything with HMRC on your behalf. Contact us right away! Disclaimer: This blog contains general information about how to avoid emergency tax.

Payroll & PAYE, Personal Tax, Tax Issues

A Guide Based on How to Claim Overpaid Tax from HMRC?

George / 06/10/2021

If you are looking for a significant source to know about how to claim overpaid tax from HMRC, then you just have found the right post. First, we will see the P800 tax calculation process of HM Revenue & Customs. This means that HMRC will automatically issue any tax repayment; you don’t have to claim it. But, you will need to make a claim in case you have overpaid tax and did not receive a P800 tax calculation from HMRC. Continue reading this blog to know more about how to claim overpaid tax from HMRC. Turn to CruseBurke for managing and recording finances and for claiming overpaid taxes! We have a team of skilled accountants who will handle everything with HMRC on your behalf. Contact us right away! When can I Overpay on Employment Income & Pension Income? If you get a pension income or employment income and pay your tax via PAYE, you might overpay tax. You can pay too much tax on employment income if: Your employer was utilising the incorrect tax code. At the same time, you have more than one job. Other income which HMRC taxes through your tax code has decreased. Your situations changed; for instance, you switched from part-time to full-time work. You have a new job, and for a time, you had an emergency tax code. You are a pupil who works during off days. You ceased working and had no taxable income or benefits for the remaining year. For a portion of the tax year, you have worked. You can overpay tax on pension income if: Your taxable income has decreased; You had more than one pension (more than 1 source of PAYE income). You overpaid tax on a total pension sum. Your pension provider was utilising the incorrect tax code; Your tax code contains the incorrect amount of state pension. What is a P800 Tax Calculation? The HMRC will get details about your total received income, amount of tax paid, and the value of received benefits-in-kind within the tax year from your employer or pension provider. With the help of this information, HMRC will automatically carry out a reconciliation in order to calculate you have paid the correct amount of tax. You will receive a P800 tax calculation by HMRC if they think you have not paid the correct amount of tax. Therefore, you have to check this calculation carefully because HMRC can have fewer or incorrect details to work out your tax accurately. In case HMRC thinks you have paid the extra tax, they will automatically issue you a tax repayment; you don’t need to claim it. And, if HMRC thinks you have not paid a sufficient amount of tax, they will write to you which explains how you can repay tax to them. How to Claim Overpaid Tax from HMRC for the Current Tax Year? You have to inform HMRC why you think you have overpaid tax before the end of the tax year. You have to tell only if you have paid too much tax through the Pay As You Earn (PAYE) system. You can call HMRC directly to inform them. You have to gather the following details before calling HMRC: Your name, job, address, and NI (National Insurance) number. For the current tax year, estimation of your income and pensions from every source. Your employer or pension provider details such as PAYE scheme reference number displayed on your payslip, or ask them for it. For future reference, do ensure you have kept a record of the following: Advisor name you spoke to Time and date of the phone call Communication between you and the advisor In order to support your claim, you may have to send some more details. HMRC will let you know about those details if needed. After processing your claim, HMRC will issue you a new tax code. It means if there is any refund, it will be added to your pension or wages, and you will automatically get the amount through the payroll. This will result in a tax refund or lower tax deduction through PAYE. You might have to claim a repayment directly from HM Revenue & Customs. This is when the refund is due towards the end of the tax year, and you have already received your final salary. Unable to claim your overpaid tax? Let us handle this! Conclusion We hope now you have understood how to claim overpaid tax for the current year. You will have to provide those above-mentioned details and extra details in order to support your claim. Therefore, you should keep a record of your income and paid taxes properly. And, we will recommend you to take help from a professional for recording your finances and claiming repayments. Reduce your business burden by letting us manage & record your finances! Our team could help you claim what is rightfully yours! So, Contact us now! Disclaimer: This article intends to provide general information on how to claim overpaid tax.

Dividend Allowance, Limited Company, Tax Issues

Corporation Tax for A Limited Company, How Much Is There To Pay?

George / 03/09/2021

If you are running your business as a limited company, you must pay corporation tax. Limited corporation’s tax rules are different from other corporations to some extent. Therefore, in this blog, you will know the corporation tax for a limited company, how much corporation tax needs to be paid, and what expenses you can claim capital tax allowances. Are you looking for an accountant to help you manage your finances? Please do not hesitate to contact us! CruseBurke accountants provide tax services at a reasonable cost! Types of Taxes to be Paid by a Limited Company? Following are the taxes that need to be paid by a limited company. Corporation Tax National Insurance Contributions (NICs) Value Added Tax (VAT) In this blog, we will cover corporation tax for a limited company. Corporation Tax for a Limited Company If you are running a limited company, you must pay corporation tax on your company profits. The current rate of a corporation tax is 19%. Corporation Tax is levied on a company’s trading profits, the sale of taxes, and investments. When establishing your limited company, you must register yourself for corporation tax with HMRC within the first three months of trading. Late registering may result in a penalty of fees. So, registering for corporation tax must be your priority. How much Corporation Tax to be paid by a Limited Company? The rates of corporation tax to be paid by a limited company in 2021 is as follows: The “main rate” for the companies, making profits except for ring fence profits, is 19%. The standard rate for the unit trusts and open-ended investment companies is 20%. You can check more information about the rates here! What Expenses are Eligible for Capital Tax Allowances? When working out how much charge you owe, a few Corporation tax stipends are available for your company. When you prepare your accounts, you can deduct your business expenses from the trading profits before tax. Capital tax allowances can only be claimed on the “entirely and exclusively” expenditures incurred for business purposes. Some costs which are qualified for capital tax allowances are: Machinery & equipment Vehicles Accommodation Mileage Training Remember that these expenses must be incurred for business purposes, and you can not claim capital tax allowances for the costs used in entertaining clients. Dividend Taxation for Limited Companies In case your local company has made a benefit after taking away trade costs and enterprise charges (corporation tax), it can give out these profits to its shareholders with something called a ‘dividend’. You’ll only pay shareholders a profit (dividend) in case you’ve got good benefits. Dividends are not charged in the UK, but the shareholders who gain them may be subject to income tax and NICs(National Insurance Contributions) depending on their personal tax allowance. However, when they complete their annual self-assessment, this will become clear. The tax rates can be changed yearly for limited companies, and it can be troublesome to decide (exactly) what your tax liabilities are. However, you can take help from the tax accounting apps to understand your tax liabilities and manage your finances. Final Thoughts To conclude our overview of corporation tax for a limited company, we can see that limited corporations benefit from being exempt from income tax. However, there is no way to avoid corporation tax, NICs, and VAT. You need to pay the corporation tax on your trading profits. Besides this, you can claim tax reliefs on corporation tax. Many tax reliefs are available to reduce your corporation tax bill, such as Research and Development relief, Creative industry tax relief, The Patent Box, Marginal Relief, Disincorporation Relief, etc. Moreover, you can reduce the corporation tax bill if you make wise strategies about the dividend payments (that directors take from the business) and salary as you can not avoid your taxes, so it’s essential to remain up-to-date about your tax duties while remaining tax efficient. Unable to claim corporation tax reliefs on your taxes? Let us handle this! We are qualified chartered accountants that can claim your tax relief and manage your taxes in no time! Disclaimer: This blog contains general information about Corporation tax for a limited company.

Limited Company, Tax Issues

What is an Annual Return? – A Beginner’s Guide

George / 02/09/2021

Every year, as a registered company owner in the United Kingdom, you must file your annual return to Companies House. In this article, we’ll go over what is an annual return, what information you’ll need, and what penalties you might face if you submit it late. Whether you’re just starting or have been in business for a while, our Chartered Accountants can help you build your business. So don’t hesitate to get in touch with us now! What is an Annual Return? It is a document which summarises the general facts about your company, including: The nature of a company’s operations Your registered office address as well as your SAIL address Share capital Contact information Directors’ information Shareholders’ information Your annual return, as the name suggests, must be filed with Companies House every year. You have 12 months to complete your yearly return; however, you can submit your information more than once during that time. This allows you to update business information without worrying about missing deadlines. You can avoid the delay by filing the most up-to-date company information first. Then, to give correct and up-to-date information, you can file a new return with Companies House detailing the modifications or updates. Remember to keep your annual returns separate from your tax return and your company’s annual accounts. You don’t need to file the one because it’s not the same as the other. Information to Include in the Annual Return The information that needs to be included in your annual return is as follows: Name, DOB, residence, and other details about the company secretary and directors. Your company’s contact information, If there is no other address, records will be stored at the registered address and single alternative inspection location (SAIL). The type of business you have (public or private) and the shares it issues. You must submit information to your stockholders in specific cases. Information about the most important business activity. To describe what your company does, you must choose your principal business activity from a catalogue of SIC (Standard Industrial Classification) codes. The Formula of Annual Return The Formula of Annual Return is: Annual Return= Final Value of Investment – Initial Value of Investment / Initial Value of Investment * 100 Unable to calculate your annual returns? Let our professionals handle this! Company Owners are Legally Obliged to File an Annual Return If you are an owner of a company, you are legally required to file an annual return on time, and in case you fail to, you may be charged with a penalty. You can see late filing penalty fees from the Government of the UK. File your Annual Return Online Through the Companies House WebFiling, you can easily file your annual return. It will only charge you around £13, and you can pay it through a credit card or PayPal. To use this service, first, you need to get registered with Companies House for WebFiling. Grow your Business with CruseBurke! We hope you now have a basic knowledge of annual returns after reading this blog. Besides this, we know that you’re busy with your business and have no time to handle company accounts, taxes and reports. Let us do that! CruseBurke is one of the UK’s driving accounting firms with a group of qualified bookkeepers, chartered accountants, and tax specialists. We solve your business problems with the best possible solution and take your business to another level. We provide accounting services for small businesses, startups, sole traders, contractors, partnership & LLP, and landlords. Get an instant quote now for these services! Disclaimer: This blog contains general information about annual returns.

Payroll & PAYE, Personal Tax, Tax Issues

Payroll and PAYE – A Complete Guide For First Time Employers

George / 30/08/2021

Payroll could be complicated for numerous foreign managers and companies that need to perform business transactions within the UK. So, in case you’ve got come to the point of setting up a payroll system and the thought of running PAYE fills you with fear, or you feel that you don’t know enough to make things right, then no need to worry as this straightforward blog will help you understand things better! This blog is based on the following essential steps to get the payroll done effectively. Enrol as an employer with HM Revenue & Customs Get yourself registered for PAYE Collect Workers details Utilise payroll software So let’s explore the details 1. Enrol as a Business Owner with HMRC First of all, make sure that whether you wish to enrol as a business owner. Ordinarily, you’ll have to do so if you are going to recruit your first employee or utilise subcontractors for development work. Moreover, you’ll have to be enlisted as a business owner if you’ve set up a local company and planned to pay yourself income as a director. Use this form to enrol as a proprietor. After becoming a business owner for the first time, you need to understand your legal obligations towards your employees. As a business owner, the charge and work obligations you have for your staff will depend on the contract you provide them and their employment status. HM Revenue & Customs have delivered a checklist for first-time business owners, which we suggest you read. Are you looking for a professional to help you with employment contracts or understand your responsibilities as a business owner? Then at CruseBurke, we have a team of skilled accountants that provides solutions to all your business problems! 2. Get yourself Registered with PAYE After registering and receiving your confirmation letter as a business owner by HMRC, you have to register online to pay taxes and NICs. This concept is termed PAYE. 3. Collect Workers details Make sure you collect all the necessary details from your new workers. You’ll require: Full name, DOB Start date National insurance number Home address Affirmation of whether they have other employments or a Student loan HMRC have made the data collection process simple as you’ll ask your new worker to fill within the online HMRC starter form. Before giving you all the required information, the newly hired employee will completes the starter form online, prints it out and sign it. 4. Utilise payroll Software The whole process will be automated with the help of a cloud-based payroll software. It will reduce your essential time and stress by taking care of tax calculations, NICs, your business stipend (if you’re entitled to one) and by producing payroll slips for workers. In addition, it will automatically generate your Real Time Information (RTI) reports submitting it to HM Revenue & Customs and reduces your burden by producing payslips for workers. Final Thoughts Famous software like QuickBooks, Sage and Zero provides you with packages that include payroll system with support. If you utilise one of these accounting software, it’ll make the payroll process easier for you. Tackling payroll by yourself is still daunting. Our payroll team can help you out with this. We are a team of professionals who offer training and support to help you get your payroll system up and running. So reach us now to save your time and grow your business like never before! Disclaimer: The content in this article is general in nature.

Limited Company, Tax Issues

How to File Company Tax Return!

George / 30/08/2021

All limited companies in the UK need to file a company tax return at the right time. In today’s blog, we’ll have a look at what is a company tax return, how to file it, when you need to file it, and what are the penalties for late filings. Here’s all you should know as a limited company owner. What is a Company Tax Return? A company tax return (form CT600) is the financial information that includes spending, profits and corporation tax figures reported to HMRC annually. You can also report it to find out how much corporation tax you have to pay. It contains the following documents: Form CT600 Company’s annual accounts Calculations of the company’s tax Any supplementary documents If a company received a notice from HMRC to complete a tax return, then a company must do it as early as possible. It typically happens after the year-end. The deadline for filing a company’s tax return is a year (12 months) after the end of its accounting period. Get inclusive accounting, bookkeeping, tax, and company formation services with our qualified accountants at an affordable rate. Get in touch today! Filing a Company Tax Return To file a company’s tax return, you need to ensure that you have: Company’s statutory accounts (annual accounts) that are balanced means your total assets should match with your total liabilities and shareholders’ equity The government gateway ID and its password. If you don’t have one, you need to create it to use the service Your Companies House password and authentication code (in case of filing your accounts together). You can get these when you register with Companies House You can use the paper form (CT600) if: You have a valid reason for not filing online You want to file in Welsh And, you need to complete and post form WT1 to describe the reason behind using the paper form. To file your accounts with Companies House and the Company Tax return with HMRC. You need to have online account details of HMRC, Companies House online account details, and company registration number. Here is what you need to do as per your situation: If you want to file accounts and tax returns together, you can use HMRC’s online service or CruseBurke‘s services If you want to file your accounts with Companies House separately, you can send your accounts to Companies House online or Contact us to do it on your behalf If you want to file a tax return with HMRC separately, you can use HMRC’s online service or our services to do it Note: You’ll only need to prepare and file your Company Tax return yourself if you’re fully confident to do it. Otherwise, you might get in great trouble. So, taking the services of an accountant is worthwhile for the accuracy and efficacy of your return. If you need the help of an accountant or tax expert, contact our qualified accountants at CruseBurke! Deadlines for Completing Return To file a return and to pay taxes, you need to follow the below-mentioned deadlines: The return needs to be sent to HMRC within 12 months after the year-end Any Corporation Tax due must be paid within 9 months and a day after the end of the accounting year Suppose, a company’s accounting period is ending on 31 December 2019, it needs to pay any Corporation Tax that is due by 1st October 2020 and file the return by 31st December 2020. Generally, these are filed together. In case of filing them late, your company needs to pay financial penalties. Penalties for Late Filing On missing the deadline of the return, you need to pay fines. If you’re: One day late, you need to pay a £100 penalty Late for three months, you need to pay another £100 penalty Late for six months, you need to pay an additional/extra penalty of 10% on your corporation tax bill. A year late, you’re levied another 10% penalty on your estimated corporation tax bill On filing a return consecutively late for three times, the £100 penalty will increase to £500. Quick Sum Up So after reading this post, you have understood: what is a company tax return, how to file them, when you need to file them, and what penalties you need to pay in case you file them late. Bear in mind that only limited companies need to submit it. If your company is dormant for corporation tax, you don’t need to submit it. Moreover, sole traders and partnerships also don’t need to submit a return but their earnings are reported to HMRC. Turn to CruseBurke for preparing and submitting the return and save your time, money, and stress. We have a team of skilled accountants who will handle everything with HMRC and Companies House on your behalf. Contact us right away! Get an instant quote for a tailored offer at a fixed fee! Disclaimer: This blog is written for general information on the company’s tax return.