Tax Issues Archives - Page 11 of 13

How Much is VAT in the UK?

George / 26/08/2021

After Brexit, the UK VAT system experienced significant updates, especially from 2021 onwards. Though the major reforms have settled, it’s still essential to understand how much VAT you must pay in 2025, what VAT rules apply, and how it affects your business or purchases. Need professional advice from a VAT accountant? Get in touch with our experts today! How Much is VAT? Let’s see how much VAT you need to pay in the UK in 2025-26. Three different VAT rates are charged on various types of goods and services in the UK. Standard Rate (20%) Currently, the standard VAT rate of 20% is levied on most goods and services. This rate is also applicable to those goods that are below the standard distance selling EU VAT threshold sent from Northern Ireland to a non-VAT registered EU client. Reduced Rate (5%) A reduced rate VAT is 5%. Some of the goods and services are charged at a reduced rate, like: Home energy Children’s car seats Mobility aids for seniors Zero Rate (0%) As evident by the name, it means that it is charged at a 0% rate. It means that your customers will pay you 0% in VAT. However, still, you need to record and report it in your VAT returns. Some of the common examples of zero-rated goods are: Basic food items Books & newspapers Children’s clothing Most goods sent from Great Britain to countries outside the UK Most goods sent from Northern Ireland to countries outside the UK and EU Along with these rates, there are some goods and services on which you don’t need to pay VAT means they are exempt from VAT. Postage stamps, financial and property transactions are common examples of it. However, you don’t need to include it in your taxable turnover. You need to bear in mind that the VAT rates keep on changing, so you must be up to date with the VAT changes. Want to register for VAT? Today Register For Vat without any hassle, at CruseBurke. VAT Reforms Post-Brexit (Still Applicable in 2025) Though no major VAT reforms have been introduced recently, the post-Brexit VAT changes from 2021 remain in effect: The £15 VAT exemption for imported low-value goods is no longer valid. Sales under £135 to UK customers from overseas are now taxed at the point of sale, not at customs. Online marketplaces (like Amazon and eBay) are responsible for collecting VAT on behalf of overseas sellers for goods sold to UK customers under £135. These changes aimed to simplify VAT collection on imports and reduce fraud, while also leveling the playing field for UK businesses. Do You Need to Charge VAT on Exports to the EU? If you’re selling goods to EU customers and you’re a VAT registered business, the good news is that you can sell your goods at a zero rate. From 2025 onwards, the goods you send to EU member states will be treated equally as the goods that come from a non-EU country. However, import taxes are payable on them. As goods, services of the UK supplier will be considered same as the supplier outside the EU. Summing Up To sum up, you have understood the VAT changes and reforms that have recently been made. In addition, to find out the answer to ‘ how much is VAT payable in the UK’ you need to look at various factors like the business platform, size, nature and the location of your customers, etc. VAT can be a complex area for many, therefore it’s better to get in touch with a tax expert for help. So, look no further other than CruseBurke! Contact our qualified VAT accountants and sort out your issues! Get an instant quote right away! Disclaimer: This blog post provides general information on VAT.

Personal Tax, Tax Issues, VAT

Is Client Entertainment Tax Deductible?

George / 24/08/2021

One of the most important marketing tactics that many businesses use is business entertainment, especially for retaining new clients and customers. Spending cost on business entertainment matters a lot when you want to build a network and attract new clients. So, if you’ve decided to allocate a marketing budget for entertaining clients and customers, you may think that whether the client entertainment is tax-deductible or not. Read on to find out the answer! Getting professional advice from a VAT accountant is preferable to reclaim VAT and to be saved from hefty tax implications that can wipe out your profit. So get in touch with our experts to be on the safe side! What is Entertainment as per HMRC? Entertainment is anything done for hospitality. Here is a list of common examples of entertainment: Offering food and drink Providing accommodation Provision of concert tickets and theatre Entry to sports events and clubs Use of capital assets for entertainment purposes Is Client Entertainment Tax Deductible? The simple answer to this question is ‘no’. As you can normally recover input tax, you paid on goods or services exclusively for business purposes. Generally, the cost incurred on entertainment for clients or customers is not considered business entertainment. For this reason, it is not tax-deductible and VAT cannot be recovered from it. However, still, there are few instances where a person can reclaim VAT, but the rules are complex and troublesome. For instance, if there is an entertainment party where you have invited your staff or employees, input tax on the cost spent on employees can be reclaimed. But still, reclaiming VAT on it is not that simple. If the employees acted as the host at the party, then the cost incurred on employees cannot be reclaimed. Say Bye to your financial worries with CruseBurke! Contact today! Is Client Entertainment an Allowable Deduction for Corporation Tax? According to HMRC, client entertainment is not an allowable deduction for corporation tax purposes. Hence, you need to pay for the cost of entertainment like the cost spent on a dinner for a client from the bank account of the business. In this stance, you need to bear in mind that the expenses that incur from your company need to be a genuine business cost and they must not be extra or excessive. Now, you might be wondering whether is it worth spending on client entertainment. It’s up to you and may vary based on your business’s nature and the clients you want to build up. Although the entertainment cost of the business is not favourable when it comes to taxes and VAT, however, you can establish good relations with your business associates and win new contracts for your business. Therefore, we can conclude that the initial investment needed to win projects is worth your time and money. Entertaining Overseas Clients/Customers You can reclaim the VAT incurred on the entertainment cost of the overseas customers/clients carried out at a reasonable scale, which is done only for business purposes. As per HMRC, an overseas customer is someone who’s not an ordinary resident of the UK or performing its business activities in the UK ( including the Isle of Man). However, there’d be an output tax if there’s a personal benefit to the overseas customer by the entertainment. In this way, it will cancel out any recoverable input tax. In most cases, the private or personal benefit is linked with business entertainment. But if the expenses are strictly for business purposes, the private benefit can be ignored. Need Help…! Knowing whether the client entertainment is tax-deductible can be complicated as there are many factors involved. However, as a general rule of law, it is not tax-deductible as it is not wholly and exclusively done for business purposes. On the other hand, you can reclaim VAT on the expenses incurred on the entertainment cost of employees or overseas customers, provided they’re only for business purposes. For detailed information about business entertainment, you can visit the HMRC website. Whether you’re a startup or an established business, CruseBurke is here to grow your business beyond numbers. So, contact our qualified accountants to sort out your issues! Get an instant quote right away! Disclaimer: This blog post provides general information on the above topic.

Personal Tax, Tax Issues, VAT

How Long Does a Tax Investigation Take? Everything you Need to Know!

George / 20/08/2021

HMRC tax investigation can be a dreadful prospect, especially for the one who has never been through this phase. In the worst-case scenarios, the investigation can take longer duration than normal and its consequences can be stressful. But fortunately, it is rare. The fear of HMRC investigation is natural and understandable. However, this process shouldn’t be that onerous if you’re efficiently handling your accounts. So in today’s blog, we’ll have a look at what is a tax investigation? What are the reasons for tax investigation? What’s its procedure and how long does a tax investigation take? Let’s start! It is advisable to get the help of a tax expert to avoid a Tax Investigation. Get in touch with us now! What is a Tax Investigation? HMRC performs a tax investigation to inspect the business’s finances to ensure that it is paying its due taxes, both current and of the past. You’re legally required to cooperate with the HMRC tax investigation team and it doesn’t imply that you have made something wrong. If you’re handling your finances with proper care and you’re having a qualified accountant, a tax investigation will not be that daunting and time-consuming. Reasons for a Tax Investigation HMRC may investigate the finances of your business for a number of reasons. Taxes can be complex and there are chances of mistakes. But you don’t need to worry if you have made an honest mistake. Here are a few of the common reasons that cause a tax investigation: Your business seems a high risk for HMRC There’re omission, mistake or unusual activity in your accounts There are noticeable inconsistencies between your tax returns like there is a large fall in income Your business is frequently filing tax returns late Your business is the target area of HMRC HMRC is suspecting your business You are having an offshore bank account Your costs are above the industry norms You’re getting income from property HMRC gets a tip-off What are the Taxes that HMRC Investigates? Many people believe that a tax investigation is just about investigating the income tax. But it’s not true. Typically, these are the taxes HMRC can investigate: VAT Capital Gains Tax Corporation Tax Construction Industry Scheme (CIS) Climate change levy Insurance premium tax Landfill tax Insurance premium tax IR35 On the lookout for Tax expert? Reach out to us today for affordable accounting services in Croydon! We provide a wide range of accounting and taxation services to small and medium-sized businesses across the UK! Procedure of a Tax Investigation So, how you’d be aware of a possible tax investigation? Before an investigation, you’ll get a notification from HMRC about the investigation and it may ask you to provide basic information as evidence to support your stance. The data they may ask will depend on the type of investigation they’re performing. You need to provide all the documents to HMRC on time, within 30 to 35 days. Failing to provide the records and data can lead to hefty penalties. The investigation can uncover all the claims and errors. Afterwards, you’ll receive a letter about the outcome of the tax investigation and the due amount you owe to HMRC. The results may not be correct always. So it’s better to consult a tax accountant before accepting the results. How Long Does a Tax Investigation Take? There is not a standard period for a tax investigation by HMRC. The duration of a tax investigation will depend on the investigation level and the paperwork required. This process can take few months, but sometimes it can extend to more than a year or even longer (for complex business structures). In addition, an investigation can be delayed by HMRC to get more information. It is not possible to predict the time limit of an investigation, but you can minimise its length. Cooperating with HMRC and providing the documents on time can speed up the investigation process. This process can take a long time if HMRC finds something new or hidden. HMRC might ask you to provide 20 years of records in case of underpayment of taxes. Usually, an Aspect investigation (where a single aspect of a return is inspected) takes up to 3 to 6 months. On the other hand, a Full Enquiry investigation can stretch to a year and more if the case is complex. And the more time it takes, the more costly it becomes. Quick Sum Up After discussing how long does a tax investigation take, you might be wondering how to avoid a tax investigation or make it less severe. In this instance, you need to maintain and keep all the records in order from the start of your business till now. The more tax records you have, the better. Bear in mind that if you receive a notice for a tax investigation by HMRC, the tidy and up-to-date financial records will help you to avoid problems during the process. Moreover, it will speed up the process of a tax investigation. A tax specialist can assist you better with what to do when you face a tax investigation. CruseBurke offers professional services to avoid or minimise the consequences of a tax investigation. Our accountants and tax experts will resolve any problem in your accounts before they turn into big issues that can lead to a Tax Investigation. Have a query? Contact us today, we’d love to help out! Disclaimer: This blog provides general information on the above topic.

Personal Tax, Tax Issues, VAT

Who Needs to Complete a Self Assessment Tax Return?

George / 13/08/2021

Find out what self-assessment is, who needs to complete a self-assessment tax return, when to submit one and what penalties you need to pay for late payments. Let’s delve into the details. There are over 12.1 million people in the UK who need to fill out and submit a self-assessment tax return to HMRC. The deadline to submit a self-assessment tax return online and pay the previous tax bill is 31st January. For the paper tax return, it is 31st October 2025. If you want to register for self-assessment as a self-employed/sole trader, not self-employed and a partner or partnership, you can register on 5 October 2025. A large number of our clients face problems while registering for self-assessment. Therefore, to make things easy, CruseBurke is offering self-assessment registration services for you to avoid stress and fuss. So what are waiting for click here to register today! What is Self Assessment Tax Return? Self-assessment is a system employed by HMRC to work out the tax on your income. Generally, the tax is deducted from your wages, pensions, and savings via PAYE (Pay As You Earn). But if you or your business is getting any income from another source, you need to report it to HMRC by sending a self-assessment tax return. Who Needs to Complete a Self-Assessment Tax Return? You need to complete a self-assessment tax return to HMRC annually to pay income tax and National Insurance (NI) against your earnings/profit. The tax return needs to be submitted if you: are a limited company director or a business partner are an employee/pensioner with annual earnings of £100,000 or more want to claim tax relief on pension contributions (higher or additional rate taxpayer) have earned £10,000 or over from investment income or savings interest need to pay capital gains tax from selling assets at a profit want to claim child benefit, if your income or the income of your partner is above £50,000 are the trustee of a registered pension scheme or of someone who has died If you receive a P800 notice from HMRC showing you underpaid tax, and you’re not repaying it through PAYE, you may need to file a tax return. are a Lloyd’s underwriter are a religious minister Remember that sometimes you need to pay taxes and NI via PAYE and need to complete your self-assessment. For instance, if you receive an investment income and operate a part-time business along with your employment. Furthermore, limited companies need to file their company’s tax return along with the tax return on personal income. CruseBurke offers financial and tax consultant services for contractors, self-employed individuals, and limited companies to stay on top of their finances. Work with our tax consultants today to address your tax returns! Contact now! When will HMRC Send you a Tax Return? Usually, HMRC will send a return to you if: you have earned income without paying tax on it (like income from investment, land, property or overseas) you’re a pensioner getting old age relief, though you need to send a short return with fewer details your capital gains have exceeded the annual exempt amount (£3,000) you were required to fill in a tax return last year Bear in mind that if you’re already aware of the tax you need to pay, you shouldn’t wait for HMRC to contact you. As it is your responsibility to declare your taxable income. After receiving a tax return from HMRC, you are legally bound to complete and submit it via post or online. On missing the deadline, you need to pay penalties and may also pay interest on the surcharges on any tax you that you need to pay. The deadline for sending tax returns via post is 31st October and online submission is 31st January. Penalties for Late Payments You need to prepare your tax returns before the deadline to avoid errors in the hassle of sending the returns late. You’d be liable to pay interest on unpaid tax and penalties. The standard penalties for sending tax returns late are as follows: Quick Sum Up Hopefully, now you know what is a self-assessment tax return, when to pay it to them, who needs to complete a self-assessment tax return, and the penalties for filing it late. Moreover, if your circumstances change like you receive new income from investments or shares, you need to inform HMRC about the changes. As it will affect your tax return. If you want to avoid paying hefty penalties, feel free to contact our certified accountants for accuracy and efficacy during the process of sending self-assessment tax returns! Disclaimer: This blog is written for general information on the self-assessment tax return.

Limited Company, Tax Issues

How to Read Company Accounts?

George / 13/07/2021

Whether you want to establish a company, want to do research, or just trying to understand the financial terminologies of the accounts. Reading and understanding those accounts can be daunting if you lack a financial background. For this reason, we’re here to explore how to read company accounts as a beginner. The details and terminologies on the accounts might not be as straightforward as you think. This information is necessary to know how we’ll business is performing at a certain time. By reading this post till the end, you’ll be able to read and understand these complex terminologies to assess the performance of your business. Let’s delve into it! It is advisable to get the help of an accountant to prepare, manage and maintain your accounts properly. Get in touch with us now! Understanding the Company’s Annual Account? The company’s accounts are the overview of the financial activities of an organisation over one year. These accounts are made for HMRC and Companies House in a tax year. They comprise: Balance Sheet Profit and Loss Statement Cash Flow Statement What is a Balance sheet? A balance sheet is a financial statement that will provide quick details of your business’s assets, liabilities and the shareholder’s equity at a single point in time. It shows the financial health of your company in a particular period. Moreover, it compares what is possessed and what is owed. It deals with assets and liabilities. An asset is something that is owned by business to generate profit. Typically, they can be divided into two types: fixed assets, current assets. Fixed assets are the long term assets like land, factories, vehicles etc. Whereas, current assets are the things that have a limited lifespan like stock items, petty cash, and cash in the bank, etc. Liability is the obligation, often as a debt that needs to be repaid. There are two common types of liabilities. A current liability is some that are due to be repaid within the timeframe of one year. On the other hand, long term liabilities are not de to be repaid within the timeframe of one year. Liquidity Ratio It is a ratio that determines the ability of a business to pay its short term liabilities. This metric helps companies to determine whether they can use their current assets to cover their current liabilities. We can calculate it as: Liquidity ratio = Current Assets / Current Liabilities If this ratio is less than one, then it could be bad news for your business. Curious to know the value of your business? Find out its net asset value. Net Asset Value Net asset value represents the net value of a company and you can calculate it by subtracting the company’s total assets from its total liabilities. Net Asset Value = (Fixed and Current assets) – (Total liabilities) On the lookout for accountants for limited companies? Reach out to us today! We provide a wide range of tailored accounting and taxation services to solo entrepreneurs all the way to small and medium-sized businesses. Profit and Loss Statement The P & L statement records a performance of a company in a certain period. In fact, this statement provides the total revenue and expenses of the business in a financial year. How to calculate P & L statement? You can easily work out the gross profit of a company. The turnover figure of this statement shows the value of your sales. You need to subtract the cost of sales from the total turnover to find out the profit and loss statement. Gross profit = turnover – cost of sales To get a better view of your business profit, you can compare this figure with the previous year’s gross profit. Right below this statement you’ll find earnings before interest, tax, depreciation and amortisation (EBITDA). To work out EBITDA, you need to subtract administrative expenses from the gross profit. Administrative expenses include: Building’s rent The cost of utilities Employees’ salaries A positive figure will provide you with a fair picture of your company’s future. EBITDA = gross profit – administrative expenses Depreciation and Amortisation Depreciation is the decreasing value of the fixed assets like machinery, equipment and buildings. In accounting, it provides an estimate of how much asset’s value is used in a certain time. Whereas amortisation works the same as depreciation but it’s applied on intangible assets like copyright, patents, intellectual property, etc. The Cash Flow Statement A cash flow statement shows the movement of the cash that goes and comes in your business in a certain period. This statement breaks cash into three categories: Operating activities show how much cash comes from selling goods and services less than the amount required to manufacture and sell the product or services. Investing activities indicate how cash has been used on capital expenditures like buying new machinery. Financing activities shows the spending of outside financing activities like cash generated through selling stock etc. If a company is making a lot of cash, it’s favourable. However, negative cash flow isn’t always a bad thing but if your company is showing a bad cash flow for a consecutive time period, you need to go for an investigation. Quick Wrap Up To sum up, after reading this post you’ve got a clear idea of how to read company accounts. With the help of this information, you can better comprehend your company’s account to determine where your business stands. Moreover, this information will let you know how a business is performing. Finally, this will help you make tailored business decisions for the long-term success of your business. Looking for professional help? CruseBurke is there to handle all of your financial worries. We provide you with professional advice for the growth of your business. Moreover, you can get accounting and taxation services for your business at an affordable rate. Need further guidance Contact us today! Disclaimer: This blog provides general information on the above topic, how-to-read-company-accounts.

Tax Issues

How to Get SA302 from HMRC If you’re Applying for a Mortgage?

George / 13/04/2021

Nowadays, almost every lender will demand the SA302 form to find out your income and tax you have submitted in the past years. In this blog, we’d be exploring why lenders are asking for an SA302 form, and how to get SA302 from HMRC while applying for a mortgage. But before moving forward, you should first understand what is SA302? Looking for affordable accounting and taxation services, approach CruseBurke! What is the SA302 Form? It is also called Tax calculation form. It is an official statement provided by HMRC that acts as evidence of your earning and tax for the last four years. It is issued after sending your self-assessment tax returns and shows how much tax you have overpaid or owe. It also shows the summary of your self-assessment. You might need this form as a self-employed person for availing mortgage. We assist self-employed persons to achieve the best mortgage deal! Why Lenders Need this Form? Lenders need this form to verify the earning of the person who’s asking for a loan. As in past, people used to declare more income than they earn, this practice is known as mortgage fraud. This statement shows the accurate income of a person. So it is advisable to ask for this form from HMRC during the initial stage of a mortgage application. How to Get SA302 from HMRC? If you registered to HMRC as self-employed and submitted your (or your accountant) self-assessment tax returns. The SA302 form can be easily received online. Through this form, you get the calculation details of the tax and SA302 details, which are sufficient to satisfy your lender. If you’re unable to get the SA302 form, just ask our accountant to solve your issue. How to Get SA302 Form Online? Log in to HMRC online account Open Self Assessment Go to more Self Assessment details Select get your SA302 tax calculation Print your full calculation Choose the year you need from the menu of tax return Open view your calculation See and print your calculations After 2017, HMRC no longer issues this form. Now you have to ask or call HMRC for getting the SA302 form. How We Can Help? Hopefully, now, you have got a clear idea of how to get the SA302 form while applying for a mortgage. Still, if SA302 is troubling you, your accountant can do this task on your behalf. If you’re looking for an accountant, just let us know to avail the cheap accounting services in the UK. Our accountants use the best accounting software whereby they can generate an SA302 form. Therefore, it’s worth investing to take help of an accountant. Can’t find what you are looking for? why not speak to one of our expert’s accountants in London and see how we can help you are looking for. It’s time to say bye to your accounting worries with CruseBurke. Disclaimer: This blog provides basic guidelines to get the SA302 form.

Tax Issues

Can I Pay My Tax bill with a Credit Card?

George / 05/04/2021

“Can I pay taxes with credit card in the UK?” This might be the most intriguing question for a new taxpayer in the United Kingdom. As we’re aware of the fact that credit card is the widely recognized way of buying things there. But, you’d be unhappy to know that HMRC does not allow payments through personal credit cards because of the EU legislation that has prohibited merchants like HMRC to charge a related fee from the customers. Though this created a disturbance for small business owners to pay using a personal credit card, however, HMRC allows payment through corporate debit or credit card. CruseBurke will resolve your financial worries. Check out how! Why HMRC Doesn’t Allow You to Pay Taxes with Credit Card? This step was taken by EU legislation to lower down the consumer payments that are charged by the merchants. The government estimated those payments around £473 million annually. For this reason, HMRC declared this law on 13th January 2018 with prior notice in late December 2017 that payments through personal credit cards are not acceptable. However, it allowed the use of corporate, business, commercial and personal debit cards for the payments. This law was implemented due to the charges (0.8%) taken by the credit card provider from the merchants (including HMRC). While HMRC needed to recharge that fee from the consumers in the form of the public purse and extra tax burden, etc. Therefore, the government totally banned the use of personal credit cards for payments. If you have cash, that’s great. If not, you may contact HMRC for a payment plan. How Can I Pay Taxes then? If you’re unable to pay taxes with a credit card, No problem. There’re a lot of other ways to pay like: Debit card Cheques Fast payment BACS Direct debit CHAPS Online or Telephone Banking Bank etc You should remember that HMRC will get the payment as per your payment method. Some methods may take 1 to 2 working days, while some might take 3 to 5 days. Unable to figure out the best cost-efficient payment method, don’t worry our professional would help. Quick Sum Up: Now, you know that you can’t pay taxes with a credit card as the law was amended in 2018 by the UK government. Yet, there are more cost-efficient ways to pay your tax bills to HMRC. To pay your taxes, you just need to gather your records, login to the government website, file your tax returns, and at last pay your taxes before 31 January. Need help with taxes! If you’re unable to file tax returns or pay your taxes yourself due to any reason, let us handle your taxation issues. CruseBurke is a team of certified accountants in Croydon to fulfill your accounting/taxation needs with accuracy, efficacy, and promptness. Contact us Now! Disclaimer: This is an informative blog written for your basic understanding.

self-employed accountant, Tax Issues, Uncategorised

How to Register as Self-Employed in the UK?

George / 03/04/2021

So you have decided to start your own business. That’s great. Now, you would earn some extra cash aside from your regular job. But now a few extra responsibilities are here on your head than before. Therefore, to get rid of legal issues, you should register yourself as self-employed to HMRC. In this blog, we’d provide a step-by-step guide on how to register as self-employed in the UK. Don’t worry the process is quite simple and easy. Are you worried about the taxes as self-employed, check out, how we can help! Step by Step Guide – Register as Self employed with HMRC: Let’s see how to register as a self-employed with HMRC: Using the Employment Status indicator check your eligibility for self-employed Register to HMRC online account with your e-mail address You’d provided with details by post including 10-digit Unique Taxpayer Reference (UTR) Complete your registration with Government Gateway details and add your business information including name, contact, etc After successfully registering as self-employed, you’d have to abide by the obligations and responsibilities as per the law. It includes completing your annual Self-Assessment tax returns. Why Should I Register? You should register as self-employed because HMRC needs to collect self-assessment tax and National insurance from your earnings as self-employed. But how can you know that you’re self employed and you need to register for it? You can check your employment status through the Employment Status indicator to know which category you fall. Typically, you’re classified as self employed if: You operate a business for yourself You are having two customers at a time You decide when and how to work You can hire other people You can provide the tools needed for work You take responsibility to do a work within the time You charge a fixed price for projects Sell services and goods to earn profit Still unable to find out your employment status, reach out to us! When should I Register? You should register as soon as possible before 5 October of the tax year, when you became self-employed. You’d be charged a penalty if you register after the deadline. Responsibilities after Registration: You’d keep a record of your business incomings and outgoings. Secondly, you’d file your Self Assessment tax return online before 31st January. Thirdly, you should pay HMRC from 31 January and 31 July. You may delay the payment as long as HMRC agrees. Moreover, you have to pay income tax along with class 2 and class 4 National Insurance contributions. If your annual income is above £85,000, then you need to register for VAT. Quick Sum Up: Now that you know how to register as self-employed in the UK, it is important to follow the guidelines provided by HMRC. You are not required to pay any fees while registering for it. These steps are quite simple, but some cases might be special that can’t be handled easily by a non-expert. So, it is better to take the help of an accountant. CruseBurke is providing free consultation services for you. Contact us anytime! Disclaimer: This blog is written for informational purposes.

Tax Issues, Tax Saving Tips

Entrepreneurs’ Tax Relief: Everything You Need To Know

George / 25/03/2021

Establishing a new business is never easy, you need to face a lot of problems while starting a new business. Being a smart entrepreneur, you should try to reduce your expenses and increase your earnings by opting for efficient strategies. This is where you need to know about Entrepreneurs’ Tax Relief. You can use this relief to lower down your Capital Gains Tax (CGT) at the rate of 10% for the business assets that are sold or disposed of. Entrepreneurs’ Tax Relief- An Overview: As a business owner, you might wish to sell or dispose of your business due to your hectic routine and many other reasons. In this case, you can claim an allowance to receive a reduced tax rate on your sold assets. This allowance is known as Entrepreneurs’ Tax Relief. This relief can help you to boost your financial gains by reducing the charges of CGT on the profit you made out while selling your business assets. Nowadays it is renamed by HMRC as Business Asset Disposal Relief. Whether you’re a freelancer or sole trader, we can fix your all tax issues within a minimum time. Just click here to get an instant quote! How to Claim and How much to claim? If you’re a business owner, this relief is one of the most captivating tax benefits for you. You can claim Entrepreneurs’ Tax Relief, which is now known as Business Asset Disposal Relief up to £1 million in your lifetime. If your claim is within the threshold of £1 million, you can claim it multiple times until you reach the limit. You can claim this relief in two ways: Self Assessment tax return Completing the Section A form of the Helpsheet Business Asset Disposal Relief Key Takeaway: If you have disposed of your business in 2010/20, the deadline to claim for this relief is 31 January 2022. Eligibility for ER: Individuals are eligible for Entrepreneurs’ Tax Relief. This relief is not available for companies. To qualify for this relief, you need to sell qualifying assets, along with fulfilling other requirements. You are given a two years qualification period to qualify for this tax relief. For qualification you must follow the below criteria: You’re a sole trader and an employee You own 5% share and voting rights You have not crossed the £1 million lifetime limit This criterion differs if you sold out your shares or you’re selling your whole/ part of your business. Though, both cases qualify for the EU, you should know the difference. Seems difficult? We can make it easy! We have a team of professional tax experts for your assistance. How Does ER Work? The process is quite simple and easy. Whenever you sell an asset, you are liable to pay tax on it. This tax relief minimizes the amount of tax you pay in terms of Capital Gains Tax (CGT). Assets that qualify for Entrepreneurs’ Tax Relief: Including the tangible assets that you sold or disposed of, your shares and securities are also eligible for this relief. However, your investment and personal assets are not eligible for this relief. How can You work out Entrepreneurs’ Relief? You can calculate this tax relief by following the below steps: Add all your capital gains and calculate your CGT Subtract it with your tax-free allowance of CGT Pay 10% from the remaining amount and the rest is yours Quick Wrap Up: We hope you have got enough information about Entrepreneurs’ Tax Relief. You should keep in your mind that the rules and regulations may vary as they change with each passing year. Therefore, you must be up to date with the latest policies and legislation by HMRC. As this will be saving you thousands of pounds. For further help and assistance, don’t hesitate to contact us for getting expert advice from our qualified chartered accountants in Croydon.

Accountants, Tax Issues

Common HMRC Tax Payment Problems and Their Solutions

George / 25/03/2021

Many people face HMRC tax payment issues due to which they’re unable to pay taxes on time. Paying taxes in time is crucial as you may end up being bankrupt or may lose a job or even you’d face prison too. The longer you take, the more intense the problem will be. Therefore, you have to deal with it quickly. Whenever you’re in tax debt, you should promptly take action to avoid it. Instead of being in tax debt, you should contact HMRC tax payment whenever you face any problem while paying taxes. Knowing Tax Payment Problems: If you’re facing any issue while paying tax, simply take action instead of ignoring it. Any delay may cause tax penalties and legal action by HMRC. These problems may be temporary and they may expose the internal problems of your business. The foremost step to counter them is to update the financial forecast and to seek advice from an expert. CruseBurke is a renowned name uplifting businesses to counter financial distress with the help of certified accountants and tax experts. Just let us know your concern! On the other side, if your business is sound enough, you should find out the way to pay your tax bills. It may be possible through borrowing, controlling or delaying expenses, and many more. You need to convince HMRC that you’re unable to pay the tax bill for taking extra time for the tax payment. Negotiating time with HMRC Tax Payment: If you’re a business owner who’s unable to pay his tax dues on time, you should instantly contact HMRC payment support service. You can also contact the HMRC Tax payment office in a case where you have already received a payment demand. For negotiating in terms of time, you need to make an agreement with HMRC allowing it for a direct debit until you pay the full amount. By doing this, interest will be charged but you can avoid tax penalties if you follow the agreement and do your tax returns on time. Our accountants and tax specialists can negotiate with HMRC on your behalf for the due tax payments. Reach out to us now! Improving Cash Flow to Avoid Tax Payments Problems: Cash flow forecasting can save you from the tax payments problems and cash flow problems. In addition, HMRC has also introduced various options to improve your cash flow. Self-employed personnel may face Tax payments problems when they are not making a considerable amount of profits compared to past profits. They can lower their payments on accounts if they feel their taxable income will decline. A budget payment plan can improve tax payments through paying taxes to HMRC in advance. It can almost eliminate all tax payments issues. Secondly, you can make a personal-tax saving account to be saved from this liability and can also earn interest. There are a lot of other options that can protect your business from late tax payments implications: Subcontractors can improve their cash flow through gross payment status under the industry scheme. Regular Importers can avail deferment accounts in warehouses until they’re in demand. Small businesses running in rural areas may receive discounts on their business rates. We can uplift your business by improving your cash flow to fight against financial troubles. Contact us for the ultimate support!