Tax Issues Archives - Page 11 of 20

News,May 2018

Construction Industry Scheme Compliance for Property Developers

George12/01/2023tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

CIS compliance refers to the focus on HMRC’s Construction Industry Scheme guide that ensures the deduction of the tax from the earnings of the contractors from the building firms is done right. There are a few exceptions in the case of subcontractors who are paid without having any kind of tax deductions. The common practice is that the tax is deducted at the rate of 20% before the payment is received by the workers. However, there is a requirement to get registered as a contractor and submit the requirements on a monthly basis. If you fail to meet the criteria of requirements, you will have to face severe penalties and a hefty amount of fines charged by HMRC. However, before you initiate any process being newly associated with the fact of being a contractor with a building firm, there are certain basics that you should be aware of. These include the facts regarding the basics of HMRC’s CIS, how is the experience of buying properties for the purpose of investments, what is the wider scope of HMRC’s Construction Industry Scheme guide, and what is De Minimus limit or how is it created for CIS. Let us kick off further discussion. Talk to our best accountants and bookkeepers in the UK at CruseBurke. You will get instant help with CIS compliance, whether you are running a small or large business. What is HMRC’s Construction Industry Scheme Guide? Contractors are often defined as those who are considered to be a business of buying subcontractors for the sake of availing certain kinds of services. It is kind of drawn widely by HMRC’s CIS. They are also known as construction companies or firms of buildings. However, sometimes they are the business themselves. Now comes the series about what is construction work, it is something that is again drawn widely by professionals. It could possibly include dismantling and demolition of the buildings, extensions, repairing, alteration, and construction of the buildings. There are some exceptions too in such cases. Moreover, when you undertake the business for the purpose of obstruction, this is something that is mandatory to process the scheme CIS. However, the case of private households that belong to people who pay for the construction of their own homes can not come under the category of CIS. What is the Experience of Buying a Property for Investment Purposes? There is a prominent comparison comes among the people who rent out their properties and the ones who buy the property for a business. Well, the major and prominent difference between both cases is the factor of investments. The Construction Industry Scheme Reform Manual also confirms it under section 12080. They’re considered to be a problem when a contractor or any other business buys a property for the sake of renting the house. This creates confusion about whether the case is now considered a contractor case according to the rules of CIS. Moreover, CIS states this in the following words: “Where a business that is ordinarily a property investor, undertakes activities attributed to those of ‘property development’, they will be considered a mainstream contractor [caught for CIS] during the period of that development”. This makes the investor a developer now who is responsible for getting registered according to the rules of CIS. This will remain the same even if there is a single example of the newly renovated property. What is the Wider Scope of the HMRC’s Construction Industry Scheme Guide? In the case when the landlord tends to be the predominant investor of the properties, the system will still move further. This is not considered to be a construction business in a wide term. This is because they are most likely deemed to be the contractors. Moreover, there are a few examples of businesses that tend to commission the firms of construction, however, the work belongs to their own business premises. Such cases do not come under the requirement of getting registered as a contractor and associated with CIS. What is the De Minimus Limit and How is it Related? The De minimus limit refers to being a part of the application to get registered as a contractor. The small contractors in the industry of construction are not required to do so because of the set limit. Especially for construction projects that are under the amount of £1,000. This excluded the amount spent on the material. This type of condition is not applicable to mainstream contractors as well. You can reach out to the professionals to handle and be compliant in this regard. This will really beneficial for your own set-up in the industry and for the future of your business. The Bottom Line Now that you have gathered a fair amount of information about CIS compliance in the UK, we can bring the discussion towards wrapping up. Being a property developer is not easy to be associated with construction and make a positive mark in the industry. However, if you process through the set limits and rules of CIS, there will be a simple and contented way to make a business grow in the future. This is often confusing for the contractors who are associated with the small business because there are a few exceptions in their case. It is better to take the professional’s advice in this regard. We hope these few minutes of reading will help you to develop a better understanding of CIS compliance in the UK and how can you make a choice that turns out to be the most beneficial to your unique circumstances. Are you seeking professional help to know CIS compliance in the UK for a small business? Why not get help from the experts at the CruseBurke? Talk to us now and we will get back to you instantly. Disclaimer: All the information provided in this article on CIS compliance in the UK includes all the texts and graphics. It does not intend to disregard any of the professional advice.

Overpaid Tax Last Year- How to Claim it Back?

George11/01/2023tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

This happens quite a lot many times with people who get into a situation that makes them do tax overpayments in the UK. The reason behind the tax overpayment can be different in every person’s case. One of the famous examples is about the people who do not work for the whole tax year and do not receive the personal allowance fully. One of the common reasons that make people fall for the situation of tax overpayment is their incorrect tax code. This is when the historic benefits in kind are being reflected rather than the current benefits in kind. This is why your salary is not according to your expectations. The tax reductions are more than what you actually owe to HMRC. You are responsible for keeping yourself aware of how to get a p800 to avoid such unfavourable circumstances. This guide has got you covered as we have compiled the focused points of discussion. This involves the overpayment of tax through PAYE, self-assessment overpayments, and other relevant facts. Reach out to our smart and clever-minded guys to get the answer to how to get p800 in the UK queries answered quickly. We will help to decide how to deal with your tax implications. What is the Overpayment of Tax Through PAYE? Reconciliation is often done by HMRC that is for the purpose of reflecting the tax year. This helps them a lot to have a clear picture of how much tax they have received and what is the exact amount of tax that the businesses and individuals owe to HMRC. The gathered information of both the information does not turn out to be the same, HMRC tends to send a P800 form to the individual who has not paid what he actually owed to HMRC. This might include a simple assessment or the tax calculation that explains the difference between what you have paid and what you owe. Moreover, if you are the one who is experiencing the calculation or a from P800 received by HMRC, you need to get alert and consciously check where you have made the mistake in the tax returns. Also, keep a track of details sent by HMRC. This is important because there are chances of mistakes made from the other side. There is no doubt that HMRC can make mistakes in calculations or other details as well. How is Self-Assessment Overpayment of Tax is Possible? When an individual is having a main job and there are other multiple sources to make the amount of income like side gigs, this means the person is within self-assessments. Sometimes when you have made the mistake of tax overpayment, the tax refund will easily be processed right after the tax returns are submitted by you. The chances of tax overpayments rise in scenarios where the salary turns low in the current tax year in comparison to the previous tax year, however, your tax liability is entered without a follow-up in the current year, this is one of the major reasons for tax overpayments. This issue can be sorted by the repayments of the extra paid money by the individuals. How to Claim Back the Overpayment of Tax in the UK? If you are an employee in the UK who is getting income through the PAYE system, it is quite possible that you will end up paying too much tax. The reason behind these overpayments can be different in multiple scenarios. According to the explanation by HMRC for overpayment of tax, there can be a range of reasons behind this mistake. You are even allowed to get the explanation of why overpayment of tax happened in the case of pension income. For any further details, you can directly get in touch with HMRC over a phone call. This is known to be a quick medium. There are different protocols in this regard. This will help you to make claim. However, before you plan, to make a claim for a refund, you will have to gather certain details of the information. This includes the following: You will have to provide basic details like your full name, your address, your national insurance number, and your date of birth. The basic information related to your pension provider The basic details of your employer The number of your earnings and pension that belongs to the current year. How to Get a P800 – How is it Related? This is the job of your boss, employer, and pension provider to get the details of how much money you are earning and what amount of tax you are paying. This will have to be shared with HMRC. This information further helps HMRC to check what is the amount of tax you should be paying. They send you the form P800 afterwards which explains what is the exact amount of tax that you owe to HMRC. This includes all the relevant information and other calculations as well. The Bottom Line Now that you have gathered a fair amount of information about how to get a p800 in the UK, we can bring the discussion towards wrapping up. This is easy to claim if you have overpaid the tax due to any genuine reason or if the mistakes were observed on behalf of HMRC. However, this needs a professional analysis to get the right details and rectify them according to the need of the current tax year. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly for small businesses’ accounting problems. Call us or email us today. Disclaimer: The general information provided in this blog about how to get a p800 in the UK includes text and graphics. It does not intend to disregard any of the professional advice.

Tax Efficiency and the Gender Pay Gap

George03/01/2023tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

Men and women when working in the same industry, are not usually paid on an equal basis. Men are always paid more than women out there. The gender pay gap reporting has now become a global issue. This makes the government take fair steps to make the industry and relevant workplaces an equal place of opportunity regardless of gender. According to the set of rules and steps that the government has taken, it has become mandatory to report the gender pay gap date on an annual base. However, there is still a lot to make workplaces equally fair for women as they are for men. To get into the root of this problem, you must be aware of certain facts related to this global issue of the gender pay gap. Considering the frequently asked queries about the gender gap in the industry, we have compiled this comprehensive guide to get you covered with all the possible answers. This involves the discussion of what is the gender pay gap in the UK, why gender pay gap reporting has become mandatory, how will this affect tax efficacy, and how to become more tax efficient when you are suffering from gender gap issues. Reach out to our smart and clever-minded guys to get an understanding of the gender pay gap reporting in the UK queries answered quickly. We will help to understand your queries instantly. Why Does the Gender Pay Gap Become a Global Issue? The average difference in income and ways of earnings among women and men is referred to as the gender pay gap. Which has become a global issue. According to research in the year 2021, the House of Commons Library in the UK said that the comparison of both the gender pay gap is fair and the median pay of women this year was more likely to be less by a percentage of 14.5 than the of men. Moreover, the Financial Times reports also agree with the fact that three out of four companies in the UK tend to pay more to men in comparison to their women counterparts. The most surprising news is that nine of the seventeen sectors of the UK economy tend to pay more men by 10 percent in comparison to female staff. How to Report the Gender Pay Gap in the UK? To sort out the issue of the gender pay gap in the UK, legislation was passed in the year 2017. According to this legislation, this has become mandatory to prepare an annual report on gender pay gap data in all organisations. All the companies will have to prepare the data and send this information based on the gender pay gap to the government by using the gender pay gap service. It does not even sound easy for an organisation. On a large business scale that has an average of 250 employees, to prepare the gender pay gap report annually. Some bigger companies have started to share the data already with the government. The deadline for the private sector is 4 April and for the public sector is 30 March. What is the Relation Between the Gender Pay Gap and Tax Implications? Everything in the industry becomes related to the tax and especially when it comes to the discussion of income. There are people who are wondering about how gender difference works for tax affairs in the UK. Considering the gender pay gap, we can say it has a lot to do with tax affairs as well. When women are noticed to get less pay in comparison to men, this might make you think that they will have to pay less tax as well. The case is different because of the actual tax deductions; the females get a small amount as their take-home pay. However, you still must focus on finding tax-efficient ways to solve this issue. How to Smartly Handle Gender-Based Taxation? An argument is developed after the discussion of the gender pay gap, which talks about gender-based taxation. However, there is no such consideration observed from the government, and regardless of your gender, everyone is taxed equally according to the tax band a person belongs. To be more tax-efficient, you need to be aware of the allowances that you can benefit from. These include trading allowance, property income allowance, marriage allowance in case you are married, personal allowance, and capital gains tax allowance. There can be quite a few more allowances, and this depends on your unique circumstances as a person. When you are aware of these tax allowances, this will allow you to be on top of your tax game. This will further help you to cut down on your tax bills as well. However, you will have to check your eligibility in this regard. Once you are fully aware of your tax-free allowances, you will be able to see your tax situation and understand it clearly. This will be a win-win situation for you. The Bottom Line Now that you have gathered a fair amount of information about the gender pay gap reporting in the UK, we can bring the discussion towards wrapping up. You can not deny the fact that the gender pay gap is now a global issue that is being noticed around the world. However, some countries like the UK have started to focus on the solution. This is why gender pay gap reporting has now become mandatory to be submitted annually to all organisations in the UK. This will allow reducing the pay gap on a gender basis in the industry. We hope these few minutes of reading will help you better understand the gender pay gap reporting in the UK. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly to the gender pay gap reporting in the UK. Contact us now. Disclaimer: The general information provided in this blog about the gender pay gap reporting in the UK includes text and …

Tax Guide for Self Employed Hairdresser

George29/12/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

Are you the barber or the hairdresser who is residing in the UK and offering services as a self-employed one as well? Well, you must be worried about paying the tax as the tax margin is very slim when it comes to HMRC in the UK. There is no apparent way to find an escape from this tax implication. So it is better to accept the liability and get yourself aware of the tax guide for self-employed hairdressers that you will have to follow for paying the tax. This will help you to be tax efficient in this regard. So it is advisable for professionals to gather information about how much money you have as tax, where are you going to pay the tax, what the required documents are to complete the process, and how will you pay the tax. The good news is that you do not have to struggle through the government gateway and come back with feelings of dread and confusion. This does not matter whether you are a self-employed hairdresser who is working in a salon or offering your services privately, the main thing you are obliged to do is to declare your income to HMRC. Let us get into the discussion to know further about the details. Reach out to one of our professionals to get to know what is the best way to handle the queries about tax guides for self-employed hairdressers for your earnings in the UK. How to Pay the Tax for being a Self-Employed Hairdresser in the UK? Just like the case of a sole trader working in the UK, the first thing you will have to do is to immediately declare your income to HMRC. This is to be done along with the information that you are a self-employed individual. You will do it through the process of self-assessment. This process is done to actually inform HMRC that here you are working, how much you are earning, and how often you are being paid. This will help HMRC to know all the untaxed earnings. For self-assessment registration, you will have to follow the deadline of 5th October in a given tax year. Moreover, you should have your UTR which is a unique taxpayer number to pay the tax. After the process of self-assessment registration is done, you will get your UTR in the post sent by HMRC. 31st January is the deadline to pay your tax bills. This will be followed in the year following the tax year that you are obliged to pay for. What are the Required Documents to Pay the Tax as a Self-Employed Hairdresser? The most important thing is to provide evidence of your income. This will also require the documents if you expect to deduct any kind of expenses. This is to make you realise the importance of making a record of everything that you are earning and spending as well. This can easily be done as there are several options to keep records on track these days. You can do it by invoicing, making the records by uploading them on online platforms, and making your own spreadsheets. You should expect HMRC can ask for this evidence of your income and expenses for a period of 22 months. This is why ensure to keep the records of the following: Expenses and income from your business The hire of the chair for business purposes The rent of the premises The receipts of travel The receipts of the customer cuts The invoices for the jobs Where Will I Pay the Tax and How Much Do I Owe? Now you must be wondering about where to pay once you are done with the preparation of all the required documents. There are multiple options to pay your tax bills. Take help from your personal account to pay the tax bills. Get in touch with HMRC yourself to pay your tax bills. You can even hire an online tax provider to pay your tax bills. If you have set up your direct debit with HMRC, you can use this way to pay your tax bills. You can even use the option of BACS with your credit card or by using the option of the cheque. Moreover, the amount you owe to HMRC as your tax bill depends on the number of your earnings. You should be aware of the three types of taxes. This includes class 4 national insurance, class 2 national insurance, and income tax. Income tax is known to be the variable that your earnings will decide how much you will pay. However, when you start to earn over the limit of figure £12,570 (from April 2023), you will have to pay national insurance for class 2 and class 4. The Bottom Line Now that you have gathered a fair amount of information about the tax guides for self-employed hairdressers, we can bring the discussion towards wrapping up. Being a self-employed hairdresser and dealing with your tax implications in the UK is time-consuming and a difficult process for many people. Especially when you are a beginner and going it for the forts time. It is advisable to approach a professional for this purpose and take their help for an accurate process to be followed. Moreover, there are multiple other options to follow. You can check what is the best option according to your circumstances and pick the right option to pay your tax bills. We hope these few minutes of reading have helped to develop a better understanding of the tax guide for self-employed hairdressers and relevant facts. This will help you in future to handle your tax affairs efficiently. Get in touch with our young, clever, and tech-driven professionals if you want to choose the best guide for self-employed hairdressers in the UK for your income. Contact now! Disclaimer: The information about the tax guide for self-employed hairdressers provided in this blog includes text and graphics of general nature. …

What is Uniform Tax Rebate?

George27/12/2022tax , Tax Issues , Tax News and Tips

Are you the individual who is responsible for taking the work uniform to the laundry? You are most likely to be in a position to make a claim for a tax rebate because of the cost you are dealing with for uniform maintenance. There are several taxpayers out there who have to wear the uniform in the form of safety garments and branded clothing, etc. To deal with this kind of tax, it is important to get to know about uniform tax rebate form P87. We may take this as part of the course and not realise that this is mandatory to reclaim the cost we spent on the cleaning of our work uniforms. Moreover, you need to have awareness about tax relief entitlements and what is the required process in order to receive the amount of money you have spent on your uniform maintenance. In this comprehensive guide, we have got you covered. As the discussion involves the answers to frequently asked questions about what is uniform tax rebate is, what the eligibility criteria are to claim a uniform tax rebate, what the worth of this tax is, and how you make a claim for your uniform. Reach out to our smart and clever-minded guys to get an understanding of the uniform tax rebate form p87 queries answered quickly. We will help to understand your queries instantly. What is a Uniform Tax Rebate? A Uniform tax rebate is also known as the name of HMRC uniform allowance or uniform benefits in the UK. This uniform tax rebate is a kind of tax that refers to a special tax for individuals who have to maintain their uniforms. This means that the specialist clothing in different work lines will have to deal with the cleaning, replacing, and repairing of their uniforms. There is a cost involved in keeping the uniform maintained, which can be claimed. However, a set of rules will have to be followed to check whether the individual qualifies for the tax or whether the clothing comes under the category of uniform or not. This also results in several people who plan to claim falling out of the category of calling their clothing a uniform. This is because they do not qualify according to the terms and conditions. What are the Eligibility Criteria to Claim a Uniform Tax Rebate? Every uniform person who is aware of the uniform rebate tax will wish to qualify for the criteria and get relief. However, certain conditions have to be met to get the cost of uniform maintenance back. The points one should consider to qualify are outlined below: You will have to be a taxpayer in the same tax year in which you intend to make a claim. You are paying for the laundry and other maintenance costs to keep your uniform clean. You are required to put on a branded uniform for your job as a nurse, shop worker, or firefighter. In some cases, a detachable badge is also allowed with the uniform. You do not receive any kind of reimbursement for the uniform maintenance cost. You are not given a uniform laundry facility at work. What is the Worth of a Uniform Tax Claim? People often enquire about the worth of a uniform tax rebate. Well, this totally depends on the kind of job you are doing which will decide the worth of the tax rebate. However, according to the basic rule of HMRC, most people get an estimated cost of around £60 within a tax year for the maintenance of uniforms and other work clothing. If you consider the basic rate of the tax, an amount of £12 can be received back from HMRC. And if you calculate this amount, it is 20% of £60. This amount can even rise up to an amount of £720 in some industries. You can even use the online calculator to check what your uniform tax is worth. How to Claim a Tax Rebate for Your Uniform? If the claim is basically about the washing cost of your uniform or your protective clothing, you do not have to worry about the procedure. It is a simple process in case of washing that even you can handle on your own without any hassle. The condition is that there should not be any other expenses incurred for the basic claim. All you have to do is get in touch with the tax office and share the details. You will normally get the amount of the money that you owe within a period of eight to twelve weeks. However, if there is any other cost involved, the scenario will be different. This can be the cost of tools and other equipment. This requires procedures where you will have to provide the pieces of evidence in a particular format, so this process becomes a little complicated to handle on your own. You will require the claim to be filled out on the form P87. You can either fill and send it online or print it and send it by post to HMRC. The Bottom Line Now that you have gathered a fair amount of information about the uniform tax rebate form P87, we can bring the discussion towards wrapping up. The uniform tax rebate is quite a basic procedure to handle on your own if it only involves the cost of washing. However, if there is any other cost involved in the claim, it will become complicated for you to handle it yourself. You will have to seek help from a professional to fulfil the requirement of a particular format and the required pieces of evidence. We hope these few minutes of reading will help you to understand the tax implications for the uniform tax rebate form P87. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions for the uniform tax rebate form P87 quickly. Contact us now. Disclaimer: The general information provided in this …

Can Charities Claim Back VAT?

George19/12/2022Tax Issues , VAT

Are you associated with a charitable organisation and finding it complicated to handle the VAT? Well, you need to be aware of the exact implication rules of VAT when you are running a charity. This can further help you to keep HMRC on your favourable side. People often enquire, can charities claim back VAT? If you are wondering the same, this guide is just the right search for you. As we have outlined, a discussion about the basics of everything that you might need to know about whether charities are exempt from tax implications, what the procedure is to get registered for VAT, whether charities can claim back VAT, and what is VAT relief for charities. Need help with VAT Registration? Understanding VAT rules can be tricky, but registering for VAT doesn’t have to be. Let our experts handle it for you. Register for VAT with CruseBurke. Is there any Truth in Charities being exempted from Tax Implications? The simple put about this is that charities are not exempt from VAT. Just like the set of rules requires the non-charitable organisation to get registered for VAT, the rule stays the same with the charitable organisations as well. However, if the charitable sales are not over a certain limit of VAT thresholds, then there is no need to get registered for VAT with HMRC. If you are a beginner in this regard, you first need to learn the basics about the procedure of getting registered for VAT with HMRC. Charities Registration for VAT Once the process of getting registered for VAT, the charity can begin to charge VAT on the products and services that it offers to people. A VAT return is also required to be submitted after event for three months. MTD-compliant VAT software is a great help in this regard. If you are wondering how much you must charge for the products, you can even use the online calculator to figure out the right calculations. Moreover, if the sales of VATable products are below the figure of £90,000, a voluntary VAT registration process can be initiated. This will be helpful in the future to make a claim for the purchased supplies and other relevant costs. Can Charities Claim Back VAT? When your charity organisation is VAT registered and also paying the standard rate of VAT, there is are chance that your organisation will qualify to reclaim VAT. Be clear of the fact that if a charity organisation is not registered for VAT, it can not claim VAT that is charged on the services and products. This is the reason the professionals always suggest going for voluntary VAT registration because you will be in a position to reclaim VAT in the future. There are a few conditions for the VAT-registered charity organisation that are to be considered before reclaiming VAT. These are outlined below: The purchase of services and products must qualify for the zero rate or reduced rate. The products come under the category of charity discounts. The charity organisation must be recognised by HMRC and associated with the Charity Commission. Once you are sure that you meet certain considerations and you do qualify for the VAT reclaim, know that your past four years will be considered only, but this applies to business VAT only. The good news is that if you are paying the standard rate, you can enjoy the VAT reclaim amount. What is VAT Relief for Charities? Once your charity is registered for VAT, it can begin charging VAT on the goods and services it provides. Registered charities are also required to submit VAT returns—typically every quarter—using Making Tax Digital (MTD) compliant software. As of 1 April 2024, the VAT registration threshold is £90,000. If your charity’s taxable turnover exceeds this amount in a 12-month period, you must register for VAT with HMRC. If your turnover is below £90,000, you may still voluntarily register for VAT. This can be useful if your charity incurs VAT on purchases and wants to reclaim VAT on eligible goods and services. Additionally, some VAT reliefs are available for charities on specific items, such as medical equipment or advertising services, even if the charity is not VAT registered. The Bottom Line Now that you have gathered a fair amount of information about whether charities can claim back VAT, we can bring the discussion towards wrapping up. It becomes tricky to handle VAT when a charity organisation is not registered for VAT. Therefore, professionals always recommend opting for voluntary VAT registration. This will benefit you in reclaiming VAT in the future. However, it is important to have a clear understanding of the qualifying criteria before you hop into any procedure as a beginner. We hope these few minutes of reading will help you develop a better understanding of whether charities can claim back VAT and how you can make a choice that turns out to be the most beneficial to your unique circumstances. Are you seeking professional help to know if charities can claim back VAT for a small business? Why not get help from the experts at the CruseBurke? Talk to us now! Disclaimer: All the information provided in this article on whether charities can claim back VAT includes all the text and graphics. It does not intend to disregard any of the professional advice.

Accounting, Tax Year Dates for Sole Traders

George08/12/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips

Whether you are new to the business world or have just signed up for being a sole trader to mark your brand in the industry, you are in need of knowing your UK tax year dates and when your accounting period will start in this first journey. Well, your first accounting period is considered the moment your business has commenced. As a beginner, several people keep enquiring whether they have a choice of the accounting period or what are other tax implications to meet before the deadline approaches. This blog will work as a comprehensive guide to help you in gathering information about your basis period, what to do if you are taxed twice in the same self-assessment, whether you have the ability to change your accounting dates, and how will you deal with the opening year period and the business losses. Talk to one of our intelligent and clever professionals to get your further queries about UK tax year dates and how to meet them. We will ensure to come up with the best possible solution. What is a Basis Period? The basis period refers to a period of time in which the sole traders are required to fulfill the tax payment liabilities in every tax year. This is just similar to your accounting year. If you are in a partnership, each individual that is involved in the partnership will have to adhere to their own basis period. This is because of the fact that the implication of the basis period is for each individual and it can not be used to apply to a partnership as a whole. According to your profession or the type of trading customers you are following, the rules will be specific for the accounting period. Generally, the rules are as outlined in the following: The profit within a duration of 12 months will have to be taxed. In one tax year, the profit duration of 12 months will be covered only, not more than this. In the case of overlap profits, there are chances that the profit is taxed for a duration of more than 12 months. Are You Taxed Twice Under the Same Self-Assessment? As a sole trader or partnership, you must know that it is preferred to choose the deadline that comes at the end of the month. This is because such dates are more convenient to follow because you mostly have your payments in hand. Now comes the question that how the accounting period is related to the overlap profits as mentioned earlier. Overlap profits referred to the kind of experience when you are taxed two times in the same self-assessment period. This happens when you tend to change the date of your accounting period. Also usually at the beginning of the accounting years well. If you are the one who is experiencing overlapped profits, this is imperative to understand that you will have to inform HMRC immediately about this while doing our tax returns. This will allow you to make a deduction of these overlap profits at the opening of the accounting year or in the case you cease your business. Can I Change my UK Tax Year Dates or Other Accounting Dates? Many people consider changing the date of their accounting period because they do not find it convenient to follow according to their needs. Especially when the rates of income tax change, people are inclined more towards changing the dates because of the relevant advantages. You are allowed to decelerate or accelerate the time when your profits are taxed. We have outlined the accounting period changing details in the following and they are available with the guidance of HMRC as well. You are liable to get in touch with HMRC to inform them by the end of 31st January if you require any change of date in your accounting period. Your accounts period should not exceed the limit of 18 months. You must check the records of your serious five years and you should not have experience in changing the accounting period. You must provide a genuine and commercial reason that is requiring the change of accounting period. How Will You Deal with the Opening Year Business Loss? If you are dreaming about loss relief, be aware that if HMRC considers your business as a hobby or side gig, you will not be allowed to avail of the relief. Most of the people who are associated with cash accounting tend to carry forward their losses in such a case. 31 March and 5th April are two options on which the accounting year ends, so you can apply for the relief before these deadlines approve because otherwise, you will have to carry forward them to the next year. You need to know that you will be able to get the relief once and there is no chance of getting it again. The Bottom Line Now that you have gathered a fair amount of information about UK tax year dates, we can bring the discussion towards wrapping up. If you are a sole trader or in a partnership, you might require a change in your accounting period date at some point. However, you will have to be considerate of the rules and regulations to follow the protocol in this regard. We hope these few minutes of reading will help you to develop a better understanding of UK tax year dates as a beginner. As well as how to deal with them professionally in the future. If you seek professional help, learn more about UK tax year dates and how to meet them. Why wander somewhere else when you have our young and clever team of professionals at CruseBurke? Disclaimer: The information provided in this blog is about UK tax year dates, including the text and graphics, in general. It does not intend to disregard any of the professional advice.

What is ATED? Annual Tax on Enveloped Dwellings Explained

George07/12/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

ATED referred to the annual tax on enveloped dwellings. This is a kind of tax that is implemented on companies in the UK regardless of whether they are residential or non-residential. However, the condition is that they must own some residential dwellings in the UK. This does not cover all the residential properties but only the properties that have a valuation over the limit of £500,000. Before delving further into the discussion, we must be aware of the relevant basics of annual tax on enveloped dwellings. Here in this article, we will help you to gather information about what is an annual tax on enveloped dwellings, the kinds of dwellings associated with it, why it is important to know that property valuation and what are business reliefs available in this regard. Reach out to our smart and clever-minded guys to get an understanding of the annual tax on enveloped dwellings queries answered quickly. We will help to understand your queries instantly. What is the Annual Tax on Enveloped Dwellings (ATED)? In simple put, we can say that the annual tax on enveloped dwellings also known as ATED is about the tax implication on the residential properties that have a market value over the figure £500,000. It can be either for a limited company or for a partnership. This is imperative to know here that one of the partners has to be the company in this regard. If any of the property is falling under the category of limited company or partnership, it will be required to file the tax returns at the beginning of the financial tax year. People often enquire about the taxable value of the property at this point, and this totally depends on the market value of the property in the same tax year. If your property does not qualify as a dwelling, you will be out of the scope of ATED. What are the Dwellings Associated with an Annual Tax on Enveloped Dwellings? According to the government of the UK, a dwelling is known to be a property that is either owned by you entirely or you own a part of it. Also, the property will have to be used for residential purposes. The related parts that are associated with such buildings like the ground or the garden are also considered dwellings. It is imperative to mention here that every property’s market value differs from others. The valuation depends on the use of the property as well. There are no examples of two properties observed that have the same market value. There are a few examples of the properties that are excluded from the list of dwellings, we have outlined them in the following: Prisons The accommodations of the military The homes used as care homes The accommodation that is used for the boarding school The halls are used for the students and for their accommodation Hospitals The guest house The area that is used for hotels The properties are exempted from the inheritance tax The dwelling that is under the public property The properties that are under the ownership of charity organisations purely for the purpose of charity Why is it Important to Know the Value of Your Residential Property? The respective valuation date matters a lot in knowing the value of your property. The value of a property also goes up every year alongside the Consumer Price Index. The chargeable amount for the years 1 April 2022 to 31 March 2023 are outlined below. The annual chargeable amount depends on the property value. If the property value is more than £500k to £1m, the annual chargeable amount will be £3,800. If the property value is more than £1m to £2m, the annual chargeable amount will be £7,700. If the property value is more than £2m to £5m, the annual chargeable amount will be £26,050. If the property value is more than £5m to £10m, the annual chargeable amount will be £60,900. If the property value is more than £10m to £20m, the annual chargeable amount will be £122,250. If the property value is more than £20m, the annual chargeable amount will be £244,750. What are the Reliefs Provided to Businesses? It is possible to reduce the chargeable amount in a tax year. There are certain reliefs provided for this reason. If you want to claim the relief, you will have to prepare and submit Relief Declaration Return to HMRC. You can do it online so it is not considered to be a very time-consuming process. A few examples of the available relief are outlined below: It must be under the ownership of a provider who is registered and belong to social housing. It should be available for the public once in a tax year at least for a minimum period of 28 days. It must be associated with a property developer for the sake of property release. The Bottom Line Now that you have gathered a fair amount of information about the annual tax on enveloped dwellings, we can bring the discussion towards wrapping up. The details of annual tax on enveloped dwellings are important to consider before you begin to calculate the valuation of your property and what is the percentage of the increase in a tax year. You can even look for a relief to claim, however, the provider must be someone registered and trustworthy in this regard. We hope these few minutes of reading will help you to understand the tax implications for the annual tax on enveloped dwellings. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly. Contact us now. Disclaimer: The general information provided in this blog about the annual tax on enveloped dwellings includes text and graphics. It does not intend to disregard any of the professional advice.

How to Manage Your Tax Credits Online in the UK?

George02/12/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

If you’re wondering how to manage your tax credit in 2025, the first thing to know is that the Tax Credit scheme is coming to an end. The UK Government has permanently closed the scheme for new applications and is gradually replacing it with Universal Credit. This article will help you understand what Tax Credits were, what’s changed, and what to do if you’re still receiving them. Paying your taxes via different payment methods may not be acceptable to HMRC. Get instant help from professional accountants and tax advisors to know how to manage your tax credit. What Were Tax Credits? Tax Credits were government payments to help people with low income. There were two types: Working Tax Credit (WTC) – for people in paid work on a low income. Child Tax Credit (CTC) – for people responsible for children. These payments helped with everyday costs and were based on your income and circumstances. Has the Tax Credit Scheme Ended? Yes. The Tax Credit scheme has been permanently closed to new claims.You cannot apply for Working Tax Credit or Child Tax Credit anymore.The scheme has been replaced by Universal Credit – a newer benefit that combines several payments into one monthly payment. What If You’re Still Receiving Tax Credits? If you’re already receiving Tax Credits, you can continue to get them for now, but you will eventually be moved to Universal Credit. This process is called managed migration and is being done by the Department for Work and Pensions (DWP). All Tax Credit claims will end by April 2025. You’ll get a migration notice letter telling you when and how to switch. Important: If you receive a migration letter, you must apply for Universal Credit within 3 months or your Tax Credits will stop. How Can I Manage My Tax Credit Before Switching? You can still manage your Tax Credit through HMRC’s services until you’re moved to Universal Credit. Here’s how: Update your income or personal details online or via the HMRC app. Renew your claim annually (if required). Report changes like a new job, new baby, or change in living situation. You can do most of this using your HMRC online account or the HMRC mobile app. What Should I Do When Moving to Universal Credit? Wait for your migration letter. Gather your personal details: income, rent, childcare costs, ID, etc. Apply for Universal Credit at gov.uk/universal-credit. Tip: Universal Credit is paid monthly and combines support for: Housing Children Disability Work income So you’ll no longer need to manage separate Tax Credit claims. Can Someone Help Me Manage the Transition? Yes. If you find the process confusing or need help applying for Universal Credit: Contact HMRC or DWP directly. Speak to a tax advisor or benefits expert. Use Citizens Advice or local council support services. The Bottom Line If you’ve been asking how to manage your tax credit, the answer has changed in 2025. The Tax Credit scheme is permanently closed and is now replaced by Universal Credit. If you still get Tax Credits, expect to be moved soon. Stay prepared by keeping your information up to date and watch for your migration letter from DWP. Need support during the switch? Our expert advisors at CruseBurke are here to help you every step of the way. Get the best taxation advice and consultation at CruseBurke in under two minutes. Feel free to reach out to us. We’d love to help you to sort out your tax problems. Disclaimer: All the information provided in this article on how to manage your tax credit, including all the texts and graphics, is general in nature. It does not intend to disregard any of the professional advice.

Voluntary Disclosure to HMRC: Is it Necessary?

George01/12/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

Whether your employment status is being a self-employed individual or you are a business owner, the management of taxes is always a complicated process for everyone. The expectation of occasional mistakes that occur unintentionally also requires your attention. Sometimes, people tend to declare their income to HMRC but the mistakes are found after a long time. However, there is a high chance that you can rectify your mistakes. The recent mistake that you have just realised while declaring your income to HMRC, opt for voluntary disclosure. Now, what is voluntary disclosure? It is a kind of activity that keeps you penalty free and safe even if you have made some unintentional mistakes. Now you aim to keep your finances straight to grow your business and stop worrying about mistakes. Here is the need to know certain facts. This guide will help you to understand everything related to this procedure. This involves the understanding of what is voluntary disclosure, what comes under it, when voluntary disclosure is required and what is its importance. Reach out to one of our professionals to get to know what is the best way to handle the queries about what is voluntary disclosure for your earnings in the UK. What is Voluntary Disclosure? You are liable to submit the multiple income streams that are helping you to make money in every way possible to HMRC. You will have to declare your income as it is and keep the factor of transparency alive with the process. HMRC ensure that the customers get the accurate amount written in the tax bills and there are no errors in the payments of tax bills. However, there are still cases of errors that occur in the tax bills or in the information provided by the customers which make the process complicated. This results in businesses and individuals paying less amount than what they actually owe to HMRC. Here comes the role of voluntary disclosure which helps to reduce the chances of errors on the tax bills. Even the previous mistakes in the tax payments can be rectified with the help of correct declaration. The payments can then be updated. This service is known by the name of digital disclosure service and is very helpful in this regard. Your discrepancies related to the income tax, corporation tax, national insurance or any other tax that you owe can be rectified easily with this. Once you sort out the matter, you will have a period of 90 days to clear the tax payment. What Comes Under Voluntary Disclosure? This voluntary disclosure can be used when a business or an individual wants to do a disclosure about any of the following: Corporation tax National insurance contribution Capital gains tax Income tax Moreover, if you feel like you were not in a position to declare all of your income to HMRC as a business, you can immediately opt for voluntary disclosure to inform HMRC. When is Voluntary Disclosure Required? It is required for all kinds of organisations, businesses, companies, and individuals to declare their income streams and the exact income so that HMRC is ensured that everyone is paying the accurate amount of tax. Current legislation is considered to check the level of accuracy in this regard. If you realise that is an error in submitting your tax returns or any other procedure, you can choose voluntary disclosure to get in touch with HMRC to inform them about the mistake. What Makes Voluntary Disclosure So Important? If you deliberately plan to hide some of the information about your income or provide false documentation to prove a figure that is not correct, you’re in trouble. HMRC will find it out later in the process. So if you are expecting that you can do it and HMRC wouldn’t know, this is a serious mistake that can result in putting you in some serious consequences. You will have to pay a huge amount in penalties and even go to prison for several years. However, if you choose to opt the voluntary disclosure, HMRC will become lenient with your case and mistakes. But if the mistakes are figured out in doubt and then from the process of investigation, you will not be spared and the consequences will be more severe than you expect. The Bottom Line Now that you have gathered a fair amount of information about what is voluntary disclosure, we can bring the discussion towards wrapping up. A voluntary disclosure to HMRC is important when you have realised a mistake in your tax returns as this allows you to get lenient treatment from HMRC and you can rectify your mistakes as well. This will help you and HMRC to pay the accurate tax bill. We hope these few minutes of reading have helped to develop a better understanding of what is voluntary disclosure and relevant facts. This will help you in future to handle your tax affairs efficiently. Get in touch with our young, clever, and tech-driven professionals if you want to choose the best guide for what is voluntary disclosure in the UK for your income. Disclaimer: The information about what is voluntary disclosure provided in this blog includes text and graphics of general nature. It does not intend to disregard any of the professional advice.