The cash basis for unincorporated businesses to calculate profits – is it worthwhile?
The cash basis has been in existence for 10 years now, and it is a “simplified” regime to calculate taxable profits based on income when received and expenses when paid. This basis ignores debtors – monies not paid to you by customers and creditors – bills you have not paid yet, and also ignores prepayments, […]
Tax returns – please file early – do not leave till the last minute!
There are many reasons to file tax returns as soon as practicable, and filing early does not mean having to pay early. The filing deadline is 31 January. Filing early means that tax liabilities are known well in advance of the payment date, and it does not come as a last-minute shock. Indeed, in some […]
Is a tax return still needed to be filed with HMRC?
From tax year 2023 to 2024 onwards, the Self-Assessment threshold for HMRC customers taxed through PAYE only, has changed from £100,000 to £150,000. Affected customers do not need to do anything now as the Self-Assessment threshold for 2022 to 2023 tax returns remains at £100,000. They will receive a Self-Assessment exit letter if they submit […]
Automated Accounts review
Especially for those that use Xero or QuickBooks! If you use Xero or QuickBooks for accounting purposes, there are various tools available that can link to the accounting records, interrogate them, and produce reports of potential anomalies. This might be postings with unexpected tax codes, or unexpected nominal accounts being used, possible capital expenditure analysed […]
Payroll and withdrawal of Employer’s allowance
Employers can, subject to certain exceptions, claim £5,000 Employers Allowance – a reduction in the Employers National Insurance rates payable to HMRC. However, if the Class 1 Employer’s liability exceed £100,000 in the previous tax year, then the allowance is not claimable. Care is needed to both ensure that a valid claim can be made, […]
Are you an “accidental landlord” and are you disclosing the income to HMRC?
Are you an “accidental landlord” and are you disclosing the income to HMRC? An accidental landlord is one where a property owned was never intended to be let out, but for a variety of reasons it has been. This might be due, for example, to inheriting a property that has not been sold, or being […]
Will ChatGPT transform how we process tax?
Generative artificial intelligence such as ChatGPT will have significant implications for accountants but AI tools need training to be a true expert in tax and accounting, argues Russell Gammon, chief solutions officer, Tax Systems Since ChatGPT was unleashed on an unsuspecting world in November last year, the technology landscape has changed irrevocably. With millions of […]
Accounting for VAT on fuel private usage
HMRC publish annually the scale rates to be used to account for VAT where VAT is reclaimed in full on fuel but there is a private element to the motoring costs. The rates to be used from 1 May 2023 were released on 21 April 2023 and the link is shown below. The VAT amount […]
Pay your tax on time – interest charges rise again on late payment?
Following the recent decision to increase the Bank of England base rate to 4.25%, HMRC has announced increases to both the interest charged on late paid tax and the rate paid on repayments of tax. As HMRC interest rates are linked to the Bank of England base rate, the 23 March 2023 increase from 4% […]
P11D Benefits in Kind – electronic filing only!
The HM Revenue and Customs (HMRC) February employer bulletin announced that you will no longer be able to submit P11D forms in paper format from 6 April 2023. Paper forms sent to HMRC on or after 6 April 2023 will be rejected as they will not be in the prescribed format. This means that any […]
