Claiming a tax deductible expense, we know, is a minefield.  There are so many rules and expenses to consider, with the rules changing all the time, how do you know what expenses you can deduct legitimately to reduce your tax bill?

We are all aware of the publicity of MPs being embroiled in controversial expenses claims, and this has prompted many small and medium sized businesses to consider what can – and cannot – be claimed.  A considerable amount of legislation exists around defining tax deductible expenses, and the rules are constantly being reviewed and clarified, hence the need by many businesses to entrust an accountant to guide them through this murky process.

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Couples only have till April next year to claim the full marriage allowance rebate available to them, dating back to the first tax year the relief came into force in 2015/16. 

This falls into the standard timeline of a four-year backdated period to claim any type of tax refund from HMRC.  This means that if you were to miss the 5^th April 2020 deadline next year, your claim for the tax year 2015/16 will be closed and you would only be eligible to request a refund from the 2016/17 tax year onward only.

Don’t miss out, find out if you are eligible to claim the marriage allowance and how to make a claim.

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Both sole traders and limited company owners can benefit from Entrepreneur’s Relief, which allows a trading business to experience reduced rates of capital gains when selling a business or ceasing to trade.

The relief has been scaled up since it was first introduced in 2008 where its starting point was set at lifetime gains of up to £1 million but now with the level of £10 million in the current tax year 2019/20, there is a potential life time saving of tax of up to £1 million, so a very important tax relief all business owners should be aware of.

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As we progress through the first quarter of the new tax year, we consider the various tax savings options available to you as an individual and for your small business to keep your profitable and enjoy good cash flow management. 

Read on for our Tax Planning Guide for Small Businesses.

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This is a question we get asked by our clients frequently and although the law states clearly that only cars used solely for business purposes by firms such as driving schools, car hire businesses or tax firms can reclaim VAT on cars, there are grey areas to consider.

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If you are self-employed and earning more than £1,000, a partner in a partnership business, a company director or if you have other income from savings, investments or property, you will need to file a Self Assessment Tax Return (SA).  The following article will show you how to reduce corporate taxes.

The SA is not a tax itself, it is a way of calculating and paying tax. If you fit into one of the categories above you are wholly responsible for completing a SA each year and for paying any tax due. To be clear, HMRC will not prompt you to complete a tax return. If HMRC do however send you a SA to complete, this must be completed and returned by the due date and not be ignored unless you have agreed with HMRC directly to cancel it.

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As a business owner of a limited company, you will be working hard to grow and be profitable whilst being aware of tax reliefs available and tax charges liable by you personally and your business.

All profits you make in your limited company are subject to a corporation tax rate of 19% in the current 2019/20 tax year.  If you want to pay your corporation tax bill early with HMRC so as to plan ahead and not get caught out by a hefty tax bill later in the year, you have the option to pay your corporation tax bill early, with the added incentive of being rewarded with interest on early repayments.

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There are many advantages of having a sole trader structure for your business with the main one being the simplicity of business administration versus a limited company set-up.  However, as your business thrives and grows the potential next step to limited company status can provide credibility and attractiveness as an established business to your customers, whilst also very importantly providing an opportunity to review your tax position.

There is a balance to be struck when considering the change from sole trader to limited company.  At a certain point you will need to consider if you are overpaying tax as a sole trader and it may be more tax efficient to move to a limited company structure.  The rule of thumb is when your turnover reaches around £30,000 per year, you should start to consider limited company status.  At this relatively low threshold of turnover you may still wait before making the transition, as there are various other deciding factors to consider as well as your business’ turnover.

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