There are various allowances and reliefs available which can help minimise tax liabilities arising on earnings, profits of trade or gains when you sell chargeable assets, but understanding what they are and which ones you are entitled to can be a minefield
HM Revenue & Customs (HMRC) helplines are available to assist taxpayers in the administration of their tax affairs, but do not provide advice on how to minimise the amount of tax you pay.
The tax legislation is often difficult to understand and constantly changing, unless you are a tax specialist it is very difficult to ensure you are both compliant with the latest legislation and minimising your tax bill. We offer all clients tax planning reviews and try to ensure that our clients only pay as much tax as they are legally obliged to and no more!
Whatever your size of business or needs we will discuss with you any tax savings that are appropriate to suit your circumstances.
Employing your spouse in the business
Spouse Salary & Pension – If you are self-employed and your spouse helps with general administration, or any other role, it is quite legitimate to pay your spouse a salary.
However, there are rules that need to be followed, such as how much to pay your spouse and have evidence that the payments were made during the year.
Sole traders and partnerships with higher rate tax liability will benefit significantly from this arrangement and further tax savings could also be made by making employer contributions to personal pension schemes
Capital Gains Tax Savings
When selling a second home you can reduce any capital gains tax that you may need to pay. The garden shed and other fixtures and fittings are treated as wasting chattels for Capital Gains Tax, i.e. when you sell them there is no tax to pay. Why not ask your solicitor to allocate part of the selling price in the contract to these items? Make sure you seek advice regarding Stamp Duty Land Tax when considering these issues.
Low interest loans provided by employers
It may be possible for a company to lend an employee up to £10,000 with no tax implications for them, provided they are not a director. This can be useful if say, the employee needs to buy a car to avoid benefit in kind tax charges.
Capital Gains – Using Home as Office
If you claim a tax deduction for the use of a room as an office there is a potential capital gains tax charge when you later sell your home, however we can advise you of measures that can be taken to help to minimise or mitigate this liability.
There are generous rules which in certain circumstances allow for the recovery of VAT on invoices that you have previously paid before you registered for VAT by including the input VAT on your first return. Make sure you have the VAT invoices and keep a schedule of the adjustments you have made. There are however time limits and rules for this recovery measure so speak to us about this.
Get in Touch
TaxSmart Accounting are an independent and forward thinking accountant with the flexibility to meet the client’s needs in a professional and personal manner. Outsource as much or as little of your bookkeeping and payroll needs as required with our fully personalised service. Contact us today for further information or a free consultation on how we can help your business.