To May’s Tax Tips & News, our newsletter designed to bring you tax tips and news to keep you one step ahead of the taxman.
If you need further assistance just let us know or you can send us a question for our Question and Answer Section.
We are committed to ensuring all our clients don’t pay a penny more in tax than is necessary.
Please contact us for advice in your own specific circumstances. We’re here to help!
RTI Round Up
Real time information (RTI) has had a bumpy start. In brief these are the major problems and work-arounds discovered so far.
Annual PAYE Schemes
If you expect to pay all of your employees just once in the tax year, and all on the same date, you can register your PAYE scheme with the Tax Office as an annual scheme – click here to read more >>
Sleeping Partners and NI
In the past sleeping partners and inactive partners didn’t have to pay NI contributions on their partnership profits. However, HMRC changed its view on this in April 2013 and it now considers that all partners are liable to pay NICs in respect of their taxable profits, whatever their level of activity within the business. The implications for inactive and sleeping partners are – click here to read more >>
Beware Pension Liberation
Have you been approached by firms that promise you instant cash from your pension fund? This known as pension liberation, and involves taking cash from your pension fund before you reach the retirement age set by your pension scheme – click here to read more >>
Don’t Rely on HMRC VAT Advice
If you are uncertain about whether you can make a claim for VAT you have incurred, or how to treat a certain transaction for VAT purposes, you could try searching the HMRC website for a solution to your query. Alternatively you may ring the HMRC VAT helpline but the adviser is likely to send you a copy of a VAT leaflet which is available on the HMRC website. This may, or may not, answer your query – click here to read more >>
May Question and Answer Section
Q. My company has been trading since 1 March 2013, but my first sales invoices haven’t been paid yet, so there is no cash available to reimburse me for the expenses I’ve incurred personally. Do I have to complete a P11D for 2012/13?
A. The annual form P11D reports expenses reimbursed to, and benefits in kind made available to the employees and directors. As you haven’t been paid any expenses by the company, there is nothing to report on the form P11D. If you have any benefits in kind provided by the company such as a car a P11D would be required.
Q. I’ve heard about the great tax breaks available under the SEIS scheme. Is this something I can use for my business?
A. The seed enterprise investment scheme (SEIS) provides investors in small companies with 50% income tax relief, and an exemption from tax for 50% of the gains they reinvest in SEIS shares (for 2013/14). However, you can’t use SEIS to invest in a company you control, as the investor and his associates (basically close relatives), must not own more than 30% of the company. The trade undertaken by the company must also be less than two years old, so to use SEIS the company has to be undertaking a new venture, and be a new clean company.
If you have an idea for a new business and you are willing to involve other investors, you may be able to use SEIS to fund that business. But please talk to us first, as there are a number of trades that can’t use SEIS, and other conditions to meet.
Q. I am employed by my company M Ltd, and my wife’s company T Ltd. M and T have completely separate trades and operate independently. I currently take no salary from M Ltd and have a modest salary from T Ltd. However, HMRC have split my personal allowance 2/3 to the PAYE code issue to M Ltd and 1/3 to T Ltd. Can I get this changed, and if so how?
A. All you need to do is ring HMRC on the number shown on your PAYE code notice and ask them to change your PAYE codes. You will need to have your NI number to hand, and estimates as well as the expected level of dividends, interest or other income to be received in 2013/14.
May Key Tax Dates
2 – Last day for car change notifications in the quarter to 5 April – Use P46 Car
19 – Deadline for Employers’ 2012/13 end of year PAYE Returns (P35, P14, P38 & P38A). Penalties for non submission.
19/22 – PAYE/NIC and CIS deductions due for month to 5/5/2013
31 – Deadline for copies of P60 to be issued to employees for 2012/13