tax Archives - Page 20 of 21

News,May 2018

Time to Pay Arrangements with HMRC

George23/11/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips , Taxation

There are several companies and organisations in the UK that fail to meet the deadlines for tax bills. If you are also one who is carrying out a business in the UK and struggling with the tax bills, you might be offered an instalment plan by the HMRC to pay your tax bills easily. This will allow you to get your payments cleared by having a long period of time and in the form of instalments. To avail of this opportunity, you must have a basic understanding of the time-to-pay arrangement. This article will turn out to be helpful in this regard, and you will be able to gather information about what a time-to-pay arrangement is, what the criteria are to check eligibility, how you can negotiate with HMRC, and how to apply for the instalment plan. Reach out to one of our professionals to get to know what is the time to pay arrangement HMRC for your business in the UK. Get in touch now and get your queries answered quickly. What is the Time-to-Pay Arrangement with HMRC? The time-to-pay arrangement refers to a kind of agreement that is working between the taxpayers and HMRC in case you fail to pay the tax. This allows you to pay the tax in instalments by availing of a long period of time. This is the agreed duration of the period that is specified for the payment plan. This plan can work for all kinds of taxes; however, it is most commonly used for the sake of corporation tax. The companies use it for the payment of VAT and PAYE. If you are a limited company that is struggling with short-term cash flow difficulties, the time-to-pay arrangement is your handy solution. However, for the companies that have a usual habit of having tax problems and paying the tax late, HMRC will not entertain the instalments for such cases. What are the Criteria to Check Whether I am Entitled to Get a Time-to-Pay Arrangement? The main thing to consider for the HMRC when a company applies for the time-to-pay arrangement is that the company needs time to clear the payment in an easy way or to find an escape from the tax bills. When a company applies, it has to prove the genuine reasons with shreds of evidence that can explain the reason why it can not pay the tax bills at the moment. The genuine shred of evidence will be able to make HMRC feel considerate about the case to approve the time-to-pay arrangement. Moreover, the payment history from past records will also be checked by HMRC. HMRC makes decisions after checking the ability of a business to pay the instalments by its financial position. Also, the chances of future tax bill payments will be considered by HMRC. Is there a Possibility of Negotiation? There is a limit to the matter of negotiation, but HMRC is flexible for this. This is not the idea to put more pressure on a business that is already going through a rough patch. This means that HMRC is open to negotiating in such hard circumstances for a business. You can even hire a professional to do the job on your behalf. Because HMRC will respond well to a person who has a better understanding of their rules. How to Apply Online for a Time-to-Pay Arrangement with HMRC HMRC now allows eligible individuals and some small businesses to apply for a Time to Pay arrangement online, making the process quicker and more accessible. This service is ideal if you are experiencing temporary financial difficulties and want to spread the cost of your tax bill into affordable monthly payments — without needing to call HMRC directly. Who Can Apply Online? You can apply for a Time to Pay plan online if all the following conditions apply: You owe up to £30,000 in tax. Your tax return has been submitted on time. You are within 60 days of the payment deadline. You don’t have any other active Time to Pay arrangements. You can pay the full amount in monthly instalments within 12 months. If you meet these conditions, the online service is the quickest way to set up your instalment plan. Taxes You Can Pay with an Online Plan Self Assessment Tax (most common) PAYE (for sole traders) Corporation Tax or VAT may still require phone-based arrangements. How to Apply Log in to your Government Gateway accountYou’ll need your login details and your UTR (Unique Taxpayer Reference). Go to the HMRC Time to Pay portalApply for a payment plan Follow the on-screen steps Enter your tax owed Choose how much you can pay upfront (if anything) Select how many months you want to spread the payments over Review and confirm your arrangementIf accepted, your direct debit will be set up automatically. What If You’re Not Eligible? If you: Owe more than £30,000, or Need more than 12 months to pay, or Are outside the 60-day window …then you’ll need to contact HMRC directly by phone to request a manual arrangement. The Bottom Line Now that you have gathered a fair amount of information about the time-to-pay arrangement with HMRC, we can bring the discussion towards wrapping up. The business that is going through a struggling phase will have to prove the genuine reasons behind it to HMRC before expecting the payment plan and the flexibility of HMRC. We hope these few minutes of reading will help you to develop a better understanding and you will be able to deal with business struggles well in the future. Get in touch with our young, clever and tech-driven professionals if you want to choose the best guide for the time-to-pay arrangement with HMRC for your business in the UK. Disclaimer: The information about the time-to-pay arrangement HMRC for your business in the UK provided in this blog includes text and graphics of a general nature. It does not intend to disregard any of the professional advice.

Tax Fears and How to Solve them

Chris22/11/2022tax , Tax Issues , Tax Saving Tips

If you are a new individual associated with the status of self-employment, you need to know everything about your relevant tax implication to avoid ending up in the fluster. Putting off the tax liabilities is not recommended because you will have to deal with unfavorable circumstances. You will also screw up if you plan to leave your tax submissions for the eleventh hour. The best practice is to keep a good track of the income and expenses dates. The tax fears and how to solve them is the query of several beginners. You all must have experienced the stress of being new to filing tax returns. If you aim to breathe and live in the tax implications even at the first experience, this article is the right kind of search for you. Talk to one of our intelligent and clever professionals to get your further queries about tax fears and how to solve them. We will ensure to come up with the best possible solution. How Do Beginners View Tax Fears? For any individual who is associated with freelancing and offering the services like content writing, being a co-founder, influencer, and an artist, the first ear of tax returns is always stressful. This is because of the uncertainty and not being clear on what exactly to do with the process of filing tax returns. Beginners often find the atmosphere of the tax industry intimidating. Navigating the whole process of filing tax returns is quite a hassle for the first time. There are plenty of services and professionals that can help to reduce the tension in such a case. Five Tips to Help to Do the Tax Returns If you are a beginner in filing tax returns, you are not alone in this. The fears you might stress about are the common fears among people while dealing with tax implications. Here are the listed five popular tips for doing tax returns for the first time with less hassle and in a stress-free manner. 1- Focus on the Way Expenses Work Keeping a track of expenses and income is quite confusing in the middle of process for the beginners. What is the exact amount that is allowed for you to deduct from your taxable income is a big question especially when you are new. When you are sure about the expense that is associated purely with the business purpose like the training courses fees, the office furniture etc. Such an amount can be deducted from the income to ensure that the tax is paid on the profits only. If you still be unsure about the exact amount of your expenses, the easy way is to get in touch with HMRC to get your queries answered. 2- Keep Some Amount of Money Aside This is not suggested to wait for the eleventh hour and then be shocked about the amount of money you have been keeping for the sake of tax is less than what you actually owe. It is better to put some money aside on a daily basis maybe 20% of your earnings to be well prepared for the tax bills and payments on time. You can even use the tax calculator to get an idea of what is the amount you owe for the tax bills. 3- Keep a Track of the Deadlines The deadlines within the frame of a tax year are important to keep a track of. This will help you to be prepared for the payments before the time and you will be able to avoid any fines and late submission penalties. 4- Open a Business Account If you aim to make things easier for yourself, open a business account for yourself. Several free offers will benefit you in the process. However, you must ensure that the account is being used for the sake of earning and spending on the business activity. This will further help you to keep a difference between your personal spending and your business spending. When you will collect the data, you will find out that everything is in one place. 5- Record on Google Sheets The google sheet and the excel sheets will work for your ease to maintain the records. When the time of final submission will come, you will get the information in an organised manner. This will help you to have a clear picture of the amount that you have spent on the business and earned from the business. The Bottom Line Now that you have gathered a fair amount of information about tax fears and how to solve them, we can bring the discussion towards wrapping up. When you are new to filing a tax return, tax fears are common. However, if you keep yourself maintained and organised by using the tips discussed above, you will be able to experience a hassle-free process of filing tax returns. We hope these few minutes of reading will help you to develop a better understanding of tax and related fears as a beginner. As well as how to deal with them professionally in the future. If you seek professional help, learn more about tax fears and how to solve 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 tax fears and how to solve them, including the text and graphics, in general. It does not intend to disregard any of the professional advice.

The UK Royals Who Pay their Taxes

George21/11/2022tax , Tax Issues , Tax News and Tips , Tax Saving Tips

There is no denying that there are so many benefits of the Royal family in the UK. The joy of having almost free personal butlers, lavish properties, crown jewels, and corgis are some fantastic examples. However, there is a set of rules that are specified for the royal family members that make their lives a little strict than normal people. Are you wondering about UK royals who pay their taxes by now? One of the strict rules is to fulfill the requirement of paying tax. The only difference you will find out is that the royals do not spend hours and hours filing self-assessment tax returns. This blog is based on the discussion of everything that you need to know about the tax liabilities of the UK royal family members, how are they taxed differently than normal people, are they being taxed at all or not. This will help you to understand the explanation of the exact tax liabilities that are to be fulfilled by the UK royals. Reach out to our smart and clever-minded guys to get an understanding of the UK royals who pay their taxes queries answered quickly. We will help to answer your queries instantly. The UK Royals Who Pay their Taxes? We all know that people are often of the view that they do not have any tax liabilities at all, but this is not true. The implications of tax are a little different in the royal member’s case. No one from the royal family is considered to be exempted from the royal family. The tax implications of the royal family are considered to be more complicated than the normal people’s tax liabilities. If you are a beginner, this is imperative to understand that the royal family members are not taxed in the usual way as you do. This is because of the fact that the royals are not considered ordinary British citizens. So the tax is implicated differently too. Normal Jobs and the UK Royals – How are They Taxed Differently? A normal job like the ordinary citizen is not associated with any of the Royal family members. However, on behalf of the Crown Estate, there are a few responsibilities to fulfil for them as well. This Crown Estate is not under the ownership of any of the royal family members and not even the government. The hereditary possessions of The Sovereign in the right of the crown are considered to be something associated with it. Moreover, HMRC takes the responsibility of collecting the profits of the crown state. The fund share is then provided to the royal family members. Furthermore, Sovereign Grant is a way to pay the royal members. Crown state funds or any other relevant income that goes to any of the royal family members is not taxed and there is no tax paid on it. Precisely we can say that the royal family pay the government itself to provide them with the funds. This is why there is no tax on such funds. Are UK Royals Being Taxed at All? This is a myth that the UK royals are not obliged to pay the tax of any kind. The funds that are received from the government through Sovereign Grants are not taxed. The major reason behind that is that this money is going from the royals. In simple words, the royals are paying this money to the government to pay them. When it comes to the personal income of the royal family members, they are required to pay the highest tax band because they come under the relevant category of being high earners. They pay the council tax on the properties they own, vat, and road tax as well. Moreover, this is surprising to know how much council tax can be generated on royal properties like Buckingham Palace just because of being big in the size. As council tax, an amount of approx £1,500 is paid every year for the royal properties. So you can imagine how much is being generated by the royals. The Bottom Line Now that you have gathered a fair amount of information about UK royals who pay their taxes, we can bring the discussion towards wrapping up. The UK royals only get an exemption from tax on the amount that they receive through the Sovereign Grant. Otherwise, they are being taxed under the highest tax band because they are considered the highest earners. We hope these few minutes of reading will help you to understand the tax implications for the UK royal family members and whether there are any tax exemptions for them or not. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly. Disclaimer: The general information provided in this blog about UK royals who pay their taxes includes its text and graphics. It does not intend to disregard any of the professional advice.

Tax for a Tennis Coach – A Basic Guide

George21/11/2022tax , Tax Issues

When you are playing the role of a tennis coach, you must know that your employment status is self-employed. Tax is considered to be a great piece of alliteration for the tennis coaches and for the tax service providers to take this tax affair into serious consideration as well. If you are an individual who aims to be a tennis coach and follow the rules of self-employment, you will have to deal with tax for a tennis coach implication along with the process. You will get your answers instantly if you are a tennis coach looking for relevant queries to be answered. In the article further, we will talk about and gather information about what is the lifestyle of a self-employed individual, what are the tax implications for tennis coaches, and what is the amount of tax that they pay. Are you a sports coach and need accounting services? You are in the right place, our chartered accountants for sports coaches can help you with taxes. What is the Lifestyle of the Self-Employed Individual? The day-to-day work life tends to be more controlled in the case of a self-employed tennis coach than the employees. You are free to take a decision about the amount of work you will allow for your routine, your rates and the relevant discussion with the customer is your responsibility; you will not have to follow the orders or the timetable of your employer. You are in a position to choose the clients that you want to work with, this is why the lifestyle of self-employed individuals is more empowering than the employees. However, we can not ignore the flip side because this makes you responsible to make enough amount of earnings to meet both ends and make a better living for yourself. The benefits for the employees include sick pay and other such holidays, there will not be any such perks. You will get paid if you are working and in case of sickness, you will not be entitled to paid leaves. This brings our attention towards the organisation of your money matters. What Tax Does A Tennis Coach pay? There are two main types of taxes that you pay when you are in the role of self-employed individual and residing in the UK. 1- Income Tax The kind of tax that you will have to pay on your earnings is known as income tax. This does not matter whether your employment status is self-employed or employed, you will have to pay income tax in both cases. The rates of the tax will depend on the amount of money that you earn within the time limit of a tax year. Here are the current income tax thresholds as of 2025-2026 Income Range Tax Band Rate £0 – £12,570 Personal Allowance 0% £12,571 – £50,270 Basic Rate 20% £50,271 – £125,140 Higher Rate 40% Over £125,140 Additional Rate 45% 2- National Insurance To get yourself the entitlement of the state benefits, you will have to pay the national insurance. The state provides support including the following: Maternity allowance State pension Disability benefit Job seeker’s allowance Bereavement support As of 6 April 2025: NIC Type Applies To Rate/Status Class 2 NICs Profits over £6,725/year Abolished from 6 April 2025 Class 4 NICs Profits over £12,570/year 6% on profits between £12,570 and £50,270; 2% above £50,270 Moreover, being self-employed does not make you eligible for all the benefits of the state. What are the Expenses of a Tennis Coach? This is well known by most of you that HMRC is generous enough to allow self-employed individuals to minus business expenses from their income while they are in the process of calculating the number of tax implications on their earnings. The related expenses of tennis coaching that are even allowable to deduct from the income are the membership of the club, the fees of the court, the cost of the website, marketing material, the insurance of the equipment, mileage, refresher training, and the tennis rackets. Moreover, it is important for you to keep a record of the receipts. This will help to explain and work as a piece of evidence that the expenses are actually related to the business and services. You will then be allowed to deduct them from your taxable amount of income. The Bottom Line Now that you have gathered a fair amount of information about tax for a tennis coach, we can bring the discussion towards wrapping up. Tennis coaching also involves the expenses of the mileage and it is also allowed to claim it with the expense. However, if you be considerate of the expenses and the relevant tax implications, there is a chance of saving yourself from the over-tax payments. We hope these few minutes of reading will help you to develop a better understanding of the tax implications of the tennis coach. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly. Call us or email us today. Disclaimer: The general information provided in this blog about tax for a tennis coach includes text and graphics. It does not intend to disregard any of the professional advice.

How will the Increase in National Insurance Tax Affect You?

George15/11/2022tax , Tax Issues , Tax News and Tips

When there is a fluctuation observed in the tax rates of the national insurance, you will definitely be affected when you are residing in the UK. How much will you be affected has a direct relation with the amount of money that you are earning. According to the recent changes that are implemented from the month of July 2022, individuals with a low scale of salary are saved and will be able to increase their savings because of the increase in national insurance tax. The high earners on the other hand will not be able to save much if you go in comparison with the tax year 2021-22. Some people will even observe a sudden rise in the take-home amount of their salary. Further in the discussion of this article, we will gather information about what is national insurance to be exact, how will the increase in the national insurance tax rate can affect you, and how to use the NI calculator to calculate national insurance. Reach out to one of our professionals to get to know what is the best way to handle the increase in national insurance tax for your earnings in the UK. What is National Insurance? The type of tax that is obligatory for employers and employees is known as national insurance and this is paid on the amount of money they earn on a monthly basis. In the case of individuals who are self-employed, they will have to pay national insurance on the amount of money that is earned from the business profits. If we talk about the basics of national insurance it was passed in the year 1911. At that time the purpose of introducing national insurance was to provide help to people who needed help with finding jobs or going through medical treatment during that period. After a certain period of time, the state pension was introduced for the financial benefits and gains of the people. The government sometimes withdraws some amount of money from the national insurance amount to support the relevant project for the betterment of society. It is imperative to add to the knowledge that it is allowable only for those who have crossed the age of sixteen. Since they are not eligible to get any retirement benefits. The main types of national insurance are four that are listed below: Class 1 – Employers and employees will pay for this class. Class 2 – It is a flat rate that is payable by self-employed individuals. Class 3 – This includes the voluntary contributions by people who are under no obligation to pay NI. Class 4 – If the self-employed business profits go above a certain level, this type of national insurance is payable. The Increase in National Insurance Tax Rates and How Will it Affects You? It has become to implement the recent changes of the increase in the tax rates of the national insurance after the new tax year was started. The ratio of this increase is between the limit of 12% to 13.25% for the employees. Individuals who are earning an amount of £4,189 or more than this within the period of a month will have to deal with the increased tax rates of the national insurance. Moreover, there is a piece of good news with this implementation of the increased rates in the national insurance tax that it will remain intact till the month of June only. The income tax threshold and the national insurance threshold will be the same from the month of July. You will be able to keep yourself away from the payments of national insurance and the income tax if your income is lower than the amount of £12,570. How to Measure the National Insurance Tax Rates With the NI Calculator? In the UK the employees have observed a sudden raise in the tax rates of the national insurance at the beginning of the tax year, however, this was sorted out because a sudden raise in income was also observed from the month of July. Most of you would like to have a clear idea about the effects of the sudden fluctuation in the tax rates of national insurance. The NI calculator can be a great help in this regard. To do the process of calculation, you will have to enter the amount of your income and the fluctuated rates and you will get the results of how the recent increase in the tax rates has affected your income. The Bottom Line Now that you have gathered a fair amount of information about the increase in national insurance tax, we can bring the discussion towards wrapping up. There is no denying the fact that the fluctuation in the tax rates can affect your income on a regular basis and if handled professionally, you will get a clear idea of how to calculate the changes and their effects on your salary. We hope these few minutes of reading have helped to develop a better understanding of the national insurance and tax rates. Get in touch with our young, clever and tech-driven professionals if you want to choose the best guide for the increase in national insurance tax in the UK for your income. Disclaimer: The information about the increase in national insurance tax provided in this blog includes text and graphics of general nature. It does not intend to disregard any of the professional advice.

What is a Certificate of Residence?

George14/11/2022tax , Tax Issues

If you want to spare yourself from being taxed twice on foreign income, you are in need to find out how you can get the tax residence certificate as an organisation, company, or individual. When you are not residing in the UK, you are allowed to claim tax relief but you are in a position that is making you pay tax on foreign income in the UK. For this, you need to get the tax residence certificate. This is also known as CoR. Moreover, there are a few conditions to apply for the CoR. These include checking if you are: Meeting the standard to be called a resident of the UK. The double taxation agreement is there with the other concerned country involved in our case. Furthermore, people who have paid the tax already without having knowledge of the tax condition will get a refund as well. The authorities overseas that are handling your matter will directly get in touch with HMRC to ask for the certification that you are a resident in the UK. Double taxation agreements with the country will also be ensured. For a person who is not entitled to the benefits of the treaty double taxation agreement, HMRC will not give your CoR. Now, this is the decision of the overseas authorities whether you will be given relief from foreign tax or not. Reach out to one of our professionals to learn more about the tax residence certificate for tax purposes. We will love to offer instant help! What is the Tax Residence Certificate? An individual who is considered a resident in the UK, also he is earning from overseas income or gains, there is a possibility of for you to avoid paying the tax twice or to claim tax relief. Many countries will require the CoR for this purpose from the tax authorities. This is to ensure that you are a UK resident. The good news is that you can apply for the tax residence certificate online now. HMRC has granted this opportunity to bring ease to the residents. It will also help to make the process swift and easy for people. However, there are a few conditions to meet before you plan to apply for CoR. You will have to provide evidence of your being a UK resident and there is the validity of the tax treaty by the other concerned country involved in your case. Moreover, the people who are in the process of making the tax payments will possibly get a tax refund soon. What Kind of Information will HMRC require? HMRC will require a certain kind of information when you apply for a tax residence certificate. This information can possibly include the following: The reason why you need a CoR? You will be required to provide the double taxation agreement under which you want to claim. The income sources for which you will make a claim, or any other relevant income source. The time for which you require the CoR is always different from the period of the issuance date. The confirmation about the owner of the benefits for the income to claim and relevant to the UK tax for income streams that are involved in the process of claim. Furthermore, you will have to inform HMRC if you have not filed your self-assessment tax returns for the relevant period. Consider the following points to bring in the knowledge of HMRC: When you arrive or leave the UK during a tax year is going on, you will require a CoR. You will need the CoR when you have spent a period of fewer than 183 days within a tax year in the UK. The reason that makes you believe that you are a resident of the UK. The date on which you left the UK or arrived here. UK residency is assessed using HMRC’s Statutory Residence Test (SRT), which considers factors like days spent in the UK, work ties, and accommodation. As mentioned above that the date of leaving or arriving in the UK will matter a lot here. The date that is created to the beginning or cessation of being a UK resident will be considered in the same way. Moreover, what are the instructions for the newly incorporated companies that have not yet filed the self-assessment tax returns? This case will be handled according to the SRT split-year rules. Split-year treatment may apply if you arrive in or leave the UK partway through a tax year, affecting your residency status for that year. Such companies will need to inform HMRC about: The basic details of the shareholders and the directors, like their names and addresses. What are the reasons that make the company believe that it is a resident of the UK? How to Apply for the Tax Residence Certificate? By now, you must be wondering about the process of applying for the CoR. When you are applying for the CoR as a sole trader or as an individual, you will have to take the following steps into serious consideration to apply for the CoR: You are allowed to use the online service to ensure that is for the process is a swift and easy experience for you. You can email the form, and when doing it online, you will not be required to sign the form. When you are in the role of an agent who is applying on behalf of an individual or a sole trader, you can do it online too. The Bottom Line Now that you have gathered a fair amount of information about the tax residence certificate, we can say that you will require the Government Gateway ID and the password if you plan to use the online service. For cases who do not have an ID already can easily create one before using the online service. Now, in a case where the other country provides the CoR, you will be required to send it to HMRC, Pay As You Earn and Self …

Are There Different Ways to Pay a Tax Return?

George03/11/2022tax

There are different ways to pay a tax return depending on the job type and wage payment mode your employer uses. HMRC provides different modes of payment to pay tax returns. If you have no idea how you can pay your tax returns and income tax, we have got you covered. In this article, we will discuss the ways employees or self-employed persons can pay their tax returns on time to HMRC, avoiding any penalty caused by late payments or inaccurate details. Sometimes, you might have incorrect tax codes or other times you might have no idea about how you can pay tax returns to HMRC. Let’s figure out everything in this informative article! Paying your taxes via different payment methods may not be acceptable to HMRC. Get instant help from professional accountants and tax advisors. Tax Returns In the UK Tax returns are filed with HMRC every year to estimate the tax liability. Mostly, citizens are not required to pay income tax under the PAYE because employers deduct income tax at source. However, if you are managing your own business or you’re working as your own boss being a contractor, then you will have to make self-assessment tax returns. There are different ways to make tax returns. The filer has to determine the best way or the most suitable method to avoid any discrepancies or penalties. First of all, we discuss the details of the tax filing details. Tax Returns Date HMRC Submitting tax returns to HMRC demands being mindful of the scheduled dates for the tax returns. If you’re paying tax returns using the online form, the due date is 31st January 2023 for the tax year 2021-2022. However, the taxpayers paying their tax returns on paper forms were supposed to complete them by 31st October 2022. The tax year begins 6th of April every year and ends on the 31st of January next year. Mostly, people pay their tax returns on the 6th of April. To avoid the probability of any inaccuracies, you need to submit way ahead of the scheduled dates of HMRC. What are the Different Ways to Pay a Tax Return? There are four ways to pay a tax return on the scheduled dates. Scheduled dates, as described above, may vary due to the form type. Paying Tax Returns Under PAYE If you get your wage under PAYE, your income tax will be deducted at source from your salary by the employer. So, you don’t need to pay tax returns. You’re free from the hassle of remembering due dates. On the other hand, if you have more than one source of income, you most probably need to make tax returns on or before the scheduled dates. Similarly, you can pay tax returns if you wish to claim more credits, expenses, and allowances. Besides, you can also do this to claim a refund from HMRC. Paying Tax Returns on Your Pension Under PAYE If your only source of income is the state pension, and you started getting a state pension on or after 6th April 2016, you don’t need to pay your tax returns, HMRC will inform you about the tax you owe to them. If a pension is your additional source of income and you are receiving another pension also, you will submit tax returns under PAYE and your employer will deduct tax at source from the state pension as suggested by HMRC. Working after you retire means you will pay tax returns on your income and state pension also. As a self-employed person, you will submit tax returns declaring all your income from your business, state pension and private pension. Construction Industry Scheme and Contractor Contractors also complete a tax return every year on their income and the allowable expenses. The registered contractors deduct roughly 20% from the payments they make to the subcontractors. These advance payments are transferred to HMRC as income tax and NICs. These early payments can be more or less than the actual income tax due. So, the contractors are required to complete Self-Assessment Tax returns before 6th April to ensure they have paid the correct amount of tax. Tax Returns as Self-Employed Persons As a self-employed person, the taxpayer will complete the tax returns as Self-Assessment Tax Returns. They are required to make adjustments and complete their tax bills by the end of January 31 or July 31 every year. They also need to pay Class 4 NICs. Different Methods to Pay Income Tax HMRC accepts different payment methods if you’re paying your self-assessment tax returns to HMRC. bank transfer using CHAPS, Faster Payments or Bacs by cheque through the post corporate debit or credit card Direct Debit in-branch at your bank or building society online banking personal debit card All of these payment methods complete the tax returns on the same day when payment is made. However, you must complete them before the due date to avoid any glitches in the financial systems or any other random mishaps. Final Thoughts Finally, we conclude the discussion that if you’re being paid under PAYE, you will make no tax bills, except when you have multiple sources of income or get a pension as well. Otherwise, you will complete your tax returns yourself in the category of Self-Assessment Tax Returns if you are your own boss and work freely without any employer. 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, Different Ways to Pay a Tax Return, including all the texts and graphics, is general in nature. It does not intend to disregard any of the professional advice.

Calculating Your Dividend Tax Bill

George02/11/2022tax , Tax Issues , Taxation

Calculating Tax on Dividends might be confusing and you can commit an error in the calculation of tax on dividend income. Income taxes are relatively easier to calculate. On the other hand, dividend income brings a lot of confusion when it comes to paying taxes on them. Dividend income is an additional source of income. So, it is possible you have invested in a company and purchased shares or stocks. As a result, you will get regular income in the form of dividends when a company earns a profit. HMRC taxes these dividends as they are also a source of income for the investors. In this blog, we will help you how to calculate tax on dividends. We will use an example to elaborate on the tax calculation of dividend income. So, let’s start! Dividend income and taxation on it might be confusing for you. Let’s seek help from the best accountants and tax advisors at CruseBurke. Contact us now! What are Dividends? Dividends are the profits shared among the shareholders of a company. A publicly-traded company typically needs capital to run its operations. For this, they can either get capital from the investors or from the debt. Mostly, companies rely on investors who invest in these companies in return for getting a share in the profits. These shares in profits are known as dividends. Whenever a company earns profit, the companies either plough back those profits or give the shareholders dividends. The larger corporations usually don’t pay dividends, resulting in the high value of the stock. The investors enjoy these dividends as it steady stream of income for the shareholders. However, HMRC levies taxes on this additional income source. The tax on dividends is lower than the general income level. There’s also a dividend allowance of £500, just like an income allowance of £12,570. What is Dividend Allowance? A dividend allowance is a tax-free dividend income. In other words, an investor can enjoy the first £500 in dividends because it gives them an opportunity to get lower dividends tax-free. In addition to a personal income allowance of £12,570, an investor can also get the £500 dividend income tax-free. According to the 2024/25 tax year, all people who have earned income from dividends up to £500 are exempt from taxes. If dividend income exceeds this allowance, they will have to pay tax according to their income tax threshold. Similarly, the shareholders cannot pay taxes on their Individual Savings Accounts (ISA). UK Dividend Tax Thresholds 2024/25 Each of the income thresholds has a different rate of tax on dividends. The three thresholds calculate the tax on dividends after personal allowance and dividend allowance have been taken into consideration. The following are the UK dividend tax thresholds for 2022/2023: Basic Rate taxpayers will pay a dividend tax of 8.75% Higher Rate taxpayers will pay a dividend tax of 33.75% Additional Rate taxpayer will pay a dividend tax of 39.35% Example: Suppose, you’re earning an income of £32,000 and getting a dividend of £3,000 annually. When you will prepare your tax returns, you will have to provide your total income first. Your Total Income = £32,000 + £3,000 = £ 35000 After you have calculated your total income, you will deduct the personal income allowance. The personal allowance is £12,570. Income after Personal Income Allowance = £ 35000 – £12,570 = £ 22,430 This is the taxable income you will pay tax on. Deduct the dividend income from this taxable income and calculate dividend tax and dividend allowance separately now. Now, you need to deduct the dividend allowance Taxable income after dividends = £ 22,430 – £3,000 = £ 19, 430 This is the basic rate of income. So, you will calculate a tax of 20%, which is £3,886 Calculate dividend tax and dividend allowance separately now. This income will help you determine the UK Dividend Tax threshold. Taxable dividend after Dividend Allowance = £3,000 – £500 = £2500 So, £1,000 is the taxable dividend. Because your total income was falling in the basic rate taxpayer threshold, so you will calculate a dividend tax of 8.75% on £2500. This dividend tax is equal to £218.75 Your total income tax including dividend tax will be Total tax = £3,886 + £218.75 = £ 4,104.75 The Final Thoughts Finally, we conclude the discussion that dividend tax calculation is tricky due to the various steps involved in this process. You can also use online dividend tax calculators to avoid the hassle of calculating taxes. It will prevent any errors in the payment of the right amount of taxes. For this, you need to remember to deduct personal income allowance from your total income. Dividend allowance will be subtracted only from the dividend income. Your taxable income will help determine the right dividend tax. CruseBurke is the right place to sort out your tax problems instantly and professionally. For more information, feel free to give us a call or send us a message. Disclaimer: All the information provided in this article on, Calculate tax on dividends, including all the texts and graphics, is general in nature. It does not intend to disregard any of the professional advice.

Business Interruption Insurance – Are Pay-Outs Taxable?

George01/11/2022tax , Tax Issues , VAT

Do you get the thoughts of the sudden reason that can cause a business closure? Here comes the help of business interruption insurance that can cover the profit and loss of the business immediately. This has to do a lot with the type of cover you might want to opt for. Several people enquire if is there VAT on business insurance. You need to get the idea of whether or not business interruption insurance was included. The process turns out to be quite a straightforward experience just like it sounds. Further in the discussion of this article, we will focus on what is business interruption insurance, how it works for your business, and what are different types of business interruption insurance. Reach out to one of our professionals to get to know if is there VAT on business insurance for your business. We will love to offer instant help! What is Business Interruption Insurance? The different types of insurance are specially designed to protect your business and you as well. This protection is provided when your business and you are going through an event or a disaster that is not in your control. Moreover, the business practices and other relevant activities are unable to operate like the regular norms of the business. How Does Business Interruption Insurance Work? The main role of this type of insurance is to protect the cash flow and profits of your business. This will ensure to help your business to be unaffected after the incident happens, be it a natural calamity or any other such event. Sometimes the coverage is so good that it will turn out to be as if the incident never affected the growth of your business. However, sometimes a set period of time is required in this process. This period is known as the name of the maximum indemnity period. This period is considered to be the period that will be taken into account for the recovery of your business operations after any natural calamity or any other event has occurred. Generally, 36, 24, or 12 months are considered for this process. Is There VAT on Business Insurance? Most of the policies will only focus to cover the valid damage claim caused by such events. Storms, fires, or floods are certain examples to make such claims. The specific policy wording is required to be referred to identify what is the available cover for you. Are you now wondering whether is there VAT on business insurance? Generally, there is no VAT on the amount you get from any kind of insurance policy. Business Interruption Insurance – What are the Different Types? Business insurance generally has three types. They are listed and explained below: 1- Increased Cost of Working This type of insurance is only related to businesses that have the space to minimise the cost related to working. Also if not too much cash is required to move ahead according to the plan. 2- Loss of Gross Revenue This is to claim for the loss of gross revenue. The service industry generally uses this kind of claim. Hotels are such examples that find this type of insurance the most appropriate. 3- Loss of Gross Profit This type is used commonly in the UK. If there is a reduction in turnover, this kind of insurance is used to cover the loss of profits. The increased cost of working and standing charges are also covered by this type. Business Interruption Insurance – Are Payouts Taxable? When it comes to the discussion of tax implications in the case of business insurance or you might wonder whether the payouts are taxable or not, the general stance of HMRC explains that if the premium is considered to be tax deductible then the insurance receipt will be taxable too. The Bottom Line Now that you have gathered a fair amount of information about ‘is there VAT on business insurance’, we can bring the discussion towards wrapping up. Business interruption insurance is a professional way to cover the loss of your business profits in the unfavourable circumstances of natural calamity or any other such events that are out of the control of business owners. We hope these few minutes of reading will help you to handle your business insurance choices in the future. Get in touch with our young, clever and tech-driven professionals if you want to choose the best guide on capital gains indexation allowance for your business. Disclaimer: The information about ‘is there VAT on business insurance’ provided in this blog includes text and graphics of general nature. It does not intend to disregard any of the professional advice.

Everything You Need to Know About Living Abroad and UK Tax

Chris19/10/2022tax , Tax Issues , Tax Saving Tips

If you are a businessman who is carrying out a business in the UK, however, you are not living in the UK but you are someone who is settled abroad. There are chances for individuals who are not residing anywhere in the UK but they have their properties here and they are earning through making them as rental properties. You will have to deal with the different scenarios of tax implication by HMRC and you are dishing pit everything that makes you obliged to have an understanding of what to do when ‘pay UK tax when I live abroad. Reach out to our smart and clever-minded guys to get your pay UK tax when I live abroad queries answered quickly. We will help to let you decide about your annual accounts with a clear mind. How to Pay UK Tax When I Live Abroad? It all depends on the unique circumstances of your earning sources. In the case you are an individual who is earning through multiple sources in the UK, you will be in a position to be obliged for the tax implications in the UK. This payment could possibly be from savings, pensions, rental property, or a business. When you have settled abroad and might have a source of income in the UK by having a rental property, you are in a position to get the allowance amount of £12,570 in every tax year. In the same way, as you are entitled to get the benefits, you will be entitled to duties and responsibilities. This means you will have to pay income tax. Am I Obliged to Pay Tax in the Country I am Settled? As discussed earlier that the tax responsibilities and tax implications are a serious matter to HMRC and when it comes to tax affairs, there is a very slim margin provided by HMRC. This makes the scenario a little complicated because you will be in a position where you will have to deal with the tax implications of the UK and the other country where you are settled in. Moreover, the only exception will be there unless the country you are living in has a double tax agreement with the government of the UK. This is also known as DTA. A double tax agreement turns out to be a very beneficial agreement for saving individuals who have settled abroad but earn in the UK as well. This way, you will keep yourself away from the edible tax payments. In other words, we can say that you will no longer be required to pay the tax in both countries, and the tax authorities will spare you in case of DTA. It will make you apply for any one of the following: You will be able to get a tax refund if you have paid the double tax. You will enjoy partial tax relief. You can enjoy full tax relief. The Prominent Differences Between a Non-UK Resident and a UK Resident It is imperative to develop an understanding of the differences between the residents of the UK and the non-residents of the UK who are settled abroad. You will have to consider the following conditions to be called a UK resident: You are required to complete the duration of 183 days to stay in the UK within a tax year to be considered a UK resident. You will have to work for a minimum of 274 days within a tax year in the UK, and this should be your main job. You should have a property in the UK, and you must spend 91 consecutive days in that property you own in the UK. Moreover, when it comes to the tax terms for the residents and the non-residents of the UK. If you are a non-UK resident, you will have to pay tax on the income earned in the UK. However, if you are not residing in the UK but are considered a resident, you are liable to all tax implications in the UK and the other country. The Bottom Line Now that you have gathered a fair amount of information about paying UK tax when living abroad, we can say that it matters a lot to know whether you are considered a UK resident or a non-UK resident to relate to your tax responsibilities. This can vary from one scenario to another because every person is in a unique situation. We hope these few minutes of reading will help you to develop a better understanding and you will now be able to handle your tax affairs efficiently in the future. Our team of professional members loves to hear out your business problems and find out the possible and suitable solutions quickly. Call us or email us today. Disclaimer: The general information provided in this blog about pay UK tax when I live abroad includes its text and graphics. It does not intend to disregard any of the professional advice.