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Capital gains tax for additional rate payer

Capital gains tax for additional rate payer

Capital gains tax is the tax payable when you sell your heirloom, shares, business, second property or any other asset. The amount of tax payable is determined by the tax bracket you are in and the tax-free allowance rate for the given year. This guide provides more information on how capital gains tax works.

What is capital gains tax?

Capital gains tax refers to the amount payable on any profits made upon the disposal of an asset whose value has gone up. The taxable amount will typically be dependent on the value of the asset and the income.

What is a disposal?
Disposal of an asset may involve:
1. Selling the asset
2. Getting compensation for an asset that has either been destroyed or lost 3. Swapping the asset for another asset
4. Transferring or gifting an asset to another party

What do you pay capital gains tax on?
1. Most personal possessions excluding your car that are equal or more than £6000 in value 2. Business assets such as machinery, plants, buildings, and land
3. Property that is not your main residence
4. Your main residence if it is used for business or let out
5. Shares
These are typically referred to as chargeable assets.

You do not pay capital gains tax on:
1. Any shares in an ISA
2. Lottery or betting winnings
UK government premium bonds or gilts

Tax allowances
Only profits above the annual tax-free allowance of £11, will be liable to capital gains tax. The annual tax- free allowance is often referred to as the Annual Exempt Amount. Depending on the type of asset that has appreciated, you may claim tax relief in instances such as:
1. Replacement of business assets/Roll over relief – Wasting assets defined as assets that last for less than five decades are usually exempted from capital gains tax.
2. Private residence relief
3. Entrepreneur’s relief – You can pay less capital gains tax if you are disposing of part or all of your business

Tax on gifts
Civil partner/Spouse
Capital gains tax is not payable on any assets you sell or gift to your civil partner wife or husband unless you: 1. Gave them the assets for them to sell on in the course of doing business
2. Separated or never lived together in the course of the tax year
Your civil partner/spouse will have an obligation to pay capital gains tax if they decide to transfer or sell the asset

Charity
Any assets you give to charity are not subject to capital gains tax

How much tax do you need to pay?
Your annual capital gains tax allowance is what determines how much capital gains tax you have to pay. You will pay capital gains tax on any profits above your annual allowance. The amount payable is calculated thus:
1. Calculate total taxable amounts on profits
2. Work out the profits for each asset that was disposed of during the tax years. The gain is typically the amount above what you paid for the asset and what the buyer paid for it when you disposed or sold it on.
3. Compute the profits from each asset
The totals will be the capital gains tax payable

Deduct any allowable losses
If you realize a loss when disposing of an asset, you can reduce your capital gains tax payable by reporting the loss to the HMRC. The total amount of loss is deducted from any profits you may have made in the tax year.

If you deduct all your allowable losses and still find that your capital gains tax is above the tax-free allowance for the year, you can still get relief by deducting unused losses from past years. Once you have enough losses from previous years to get you into the tax-free allowance bracket, you can carry forward any remaining losses to use for relief in future years.

You do not have any tax obligations if you capital gains tax are below your allowable tax allowance for the year. Nonetheless, you are obligated to inform the HMRC if:

1. You sold or transferred chargeable assets that are worth more than four times the tax allowance (£46,800) for the 2018-2019 tax period.
2. You got losses that you need relief from
You can include this in your tax returns

Apply the tax rate
Capital gains tax for basic income taxpayers is pegged at 10% and 20% for those on the higher tiers of income. Any capital gains realized on the disposal of a buy to let investment or a second home, basic rate taxpayers will need to pay 18% in capital gains tax while higher tier taxpayers will have to pay 28%.

How can you report and pay capital gains tax?
You can pay and report your capital gains tax if you are a UK resident on the real-time Capital Gains Tax service on GOV.UK

Example
Kate purchased an apartment for £200,000 and then sold it for £250,000 making a £50,000 profit
The direct costs incurred in selling and buying the asset can be deducted when we calculate how much she needs to pay in capital gains tax:

£50,000 – £3,000 (advertising fees, estate agent fees among other selling costs) – £3,000 (stamp duty, survey fees and other buying costs) = £44,000 (chargeable gain/the net gain) – £11,700 (tax allowance) = £32,300 (Capital Gains Tax).

Let us assume that the apartment was a buy to let – an investment property. We need to calculate her capital gains tax by taking the appropriate tax rate and multiplying it by the taxable gain: The appropriate rate may either be 28% or 18% or a combination of the two. The applicable rate will depend on how much income

Kate has:

Higher tier taxpayer: If her income is greater than £46,350 (the tax bracket is £46,351 to £150,000) in the tax year 2018 to 2019, she will be classified on the higher band. This means that the applicable capital gains tax will be at 28%. This works out to 28% of £32,300 which is £9,044.

Basic Taxpayer: If Kate makes less than £46,350 a year (the tax bracket is £11,850 to £46,350) she will be classified as a basic rate taxpayer. The basic rate taxpayer pays taxes at 18%. As such, if she has an income of say £30,000 she will be in the basic band for the first £16,350 and at 28% for the rest of her income that falls in the higher tier band:

18% x £16,350 = £2,943+ 28% x £15,950 = £4,466 Total tax = £7,636

If she reports income less than £11,700 (her personal allowance) or no income at all for the tax year, the capital gains tax will be charged under the basic rate band at 18%. This will be
£32,300 x 18% = £5,814

Accountants Guide for Courier Drivers

COURIERS’ TAX RETURNS

Online shopping is one of the most developing segments in business. The development of online shopping has led to the creation of more jobs. One of the tasks that online shopping has created is courier freelancing.

How To Become A Freelance Courier

The first thing you need for you to work as a freelance courier is a van. You can use your van, or if you don’t have, you can hire. A freelancer courier can take jobs from courier companies like UPS or FedEx. Also, if you are capable, you can begin your own courier company.

Pros and Cons of The Two Courier Options.

– If you have to work under any other courier service as a freelancer, you will have no worry about how you will source for clients. However, your agreement with these companies will always tie you down.

– If you begin your own courier business, you will have the freedom to choose the clients you can work for, and you will put in a lot of efforts. Your inputs either hard work or finances would determine how many clients you will get.

How to Advertise Your Courier Services

Are you planning to begin your own courier services company? There are a few tips that may be helpful you can use to get clients. Some of the techniques are:

– Develop a website. Developing a professional website will help in boosting the credibility of your company. You can list your services on the website and also the prices for your services. Also, the site is a good point where you can communicate with your clients.

– Social networking. There are a lot of social media platforms with steady users which you can use to grow your business. You can run adverts on these platforms where you can target individuals looking for freelance courier services. You can use Facebook, LinkedIn, Instagram or Twitter to create your market base.

– Business cards. A freelancer can design and printout business cards. The cards should show your services, names and also contact details. You can then give the cards to your friends, family members, and even potential clients.

– Create adverts. Not everyone uses social media. You can use local advertising as your medium of communication. Adverts are cheaper and quickly meet your target audience.

How To Become Better in Your Courier Services

If you begin your own courier company, the better you are at your job, the chances of getting more clients are higher. Some of the skills that some of the best couriers have are:

– Stick to deadlines. Once customers purchase or request for goods, they usually need them in a short time. Due to the loads of packages you have to deliver, it would be wise to create a plan which will allow you to

stick to their schedules.

– Have adequate knowledge of the streets. In case your navigation system breaks down during your deliveries, you need to have sufficient experience of every street. It will help you to keep time even without a nav system.

– Stay fit. Since you will be spending a lot of time sitting in your van, you need to be healthy. Also, you will need to be fit for you to load and off-load your van.

– Be a good driver. This is one of the essential requirements that you need. You should have a valid driving license and also stick to the Highway Rules.

Accounting as a Courier.

There are a lot of benefits that you will enjoy in being a freelance courier. However, as a freelancer, there is one major challenge which is accounting. If you are employed, your tax is taken care of in the PAYE form. As a freelancer, You have to prepare your financial records and pay for the Self-assessment tax return. It’s done annually, and it may be challenging for you. It can distract you from your busy delivery schedules.

Getting Accountancy and Tax Advice.

You can contact GM :Professional accountants to prepare your the financial records at the end of the year. We specialise in this sector and provide bookkeeping, tax return services and company accounting services.  For the courier agency to operate smoothly, we will provide general tax advice on accounting and tax returns. It will be perfect if you keep your records up to date each month as this will allow you to make an informed decision.

R&D Tax for Small busineses – Research & Development tax relief

What Exactly Are Research And Development (R&D) Tax Credits?

Research and development or R&D tax credits are incentives from the government engineered to reward UK businesses for investing in innovation. They are, therefore, a valuable source of money for companies to invest in improving their R&D. They can also use the cash to hire new staffs and ultimately grow their businesses.

Small and medium-sized enterprise (SME) R&D can claim for the following:

  • Can deduct an extra 130% of their qualifying R&D expenditure from their profit, plus the normal 100% deduction, this is a total of 230% deductions.
  • A loss making company can claim a tax credit , the rate is 14.5% of the surrenderable loss

 

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The money is refunded in different ways. For one it can be paid as a negative corporation tax or as a tax refund at the end of a financial year.

Examples of R&D costs are supporting software/Saas, subcontractor costs, testing, management, prototyping, technical analysis and developing manufacturing processes.

Who Qualifies For R&D Tax Credits?

R&D covers all sectors. It takes place in everything from digital development to construction and from chemical engineering to cheese-making.

However, you must provide proof to the HMRC that your technology was complex. Here you must submit technical and financial details of your innovations. The HMRC has detailed criteria, and your R&D must meet them.

1. Technology

One rule of qualification though is that a project qualifies to be R&D if it offers a modification to an existing service, process or product.

If it’s not yet clear whether or not you are having qualifying R&D, here are some illustrations:

If you have a platform whereby people can upload videos using image recognition to tag and analyze these videos, then you might qualify.

There are logistics in business that auto determines how products will be shipped to the appropriate locations on time. The same logistics also determine the most reasonable price to sell those products in those locations. If you have such a platform then you might qualify.

However, you will not qualify for R&D if you deal with setting up a Drupal site or WordPress.

Besides those platforms, the qualification also depends on factors such as performance and scale. Here are examples on that:

If a search tool offers quick results when a person searches across terabytes of data from thousands of corporate shared drives, then it might qualify. However, if the tool searches across a few and simple documents stored on a hard drive, then it cannot qualify.

A site that allows people to send images and short messages to 400 million active users every day, it might qualify. But if the website enables them to share the images or messages between each other than it will not qualify.

2. Cost

If your innovation did cost you at least 100k or more on skilled engineers/developers to create it, then it probably might qualify.

3. Technical Uncertainty

At times you might be developing a product/service and you are not certain whether it could be created to the recommended specification. In such a case the outcome is uncertain and the innovation could be R&D.

4. Innovation

Speaking of innovation, you might have succeeded in projects that others have failed in. in such a case, your innovation could probably be Research and development.

As for those participating in common innovations that other people can easily do, then that is not R&D.

5. Qualifications

As for qualifications, the thumb rule applies here. Let’s say you have competent and smart people with formal qualifications who spend lots of time on a project. If so, then it could be an indication that the project is R&D.

On the other hand, if your technology does not involve such skilled people, it might not necessarily imply it is not R&D. Have a look at other details on technology.

Technology Qualifies For R&D Under These Circumstances:

1. The Finances

For technology to qualify, you must have spent lots of money developing it. Not only spending money but do so in the right way that convinces HMRC to consider you for R&D tax relief.

2. Rules
Apart from finances, your company must be UK based to qualify for R&D Tax Credits.

Additionally, your UK business must have spent finances creating a technology that adheres to the aforementioned criteria. Some of the ways of spending money on technology include:

i) PAYE deductions for employees
ii) Buying materials for the project and the excess ones can’t be sold for full value iii) Paying subcontractors to deliver your project
iv) Software licenses for delivering the project

The spending, however, must be within the last 2 financial years – at times 3 years.

While there are other details, you might qualify for R&D if you meet those criteria. The Pricing of R&D Tax Credits

There are several government funding specialists in the UK. Each has their own pricing for R&D filings. But as for us at GM, we charge 15%.

What sets us apart from the rest is that we are transparent. As in we don’t have hidden fees or charges. Our pricing varies based on your research and development expenditure. Nonetheless, we focus on advancing your R&D Tax Credits using our special Advance Funding product.

How Much Refund Will You Get?

The tax refund depends on your specific situation. However, there is a rule of the thumb used here, which is:

i) A large business doing R&D gets around 11% of its R&D costs refunded.

  • Can deduct an extra 130% of their qualifying R&D expenditure from their profit, plus the normal 100% deduction, this is a total of 230% deductions.
  • A loss making company can claim a tax credit , the rate is 14.5% of the surrenderable loss

So far everything sounds great, but how do you get the refund?
First, you should write a technical narrative and make it as convincing as possible. In the narrative, ensure you include a clear table of all the financial calculations.

Once done, amend the CT600 and file it with HMRC. From there you can decide whether to file it yourself or hire a specialist like GM. If you are a DIY person and want to handle everything, you can proceed. Just ensure you fill details in the correct boxes in the CT600.

Along explain why your innovation qualifies for R&D Tax Credit. Include a calculations table to support your claim amount.

The idea is to convince the HMRC that you know what projects and costs qualify for R&D. if your application is successful, you’ll receive your refund in the next two to eight weeks.

In case MHRC thinks your filling is incorrect, you will get an HMRC inquiry. It entails several questions, which will delay your refund. The worst it can get is gruelling meeting along with penalties for incorrect filling.

Accountants near Enfield 

Accountants near Enfield

If you have been on the search for an accounting firm near Enfield, there is no one better than GM Professional Accountants. We are conveniently located in Ilford Essex and Covent Garden, both a few hundred meters away from the train Station.

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It is not easy to find accountants near Enfield who can take care of all your accounting needs. This is where we come in as we provide the following specialist services:

1) Your capital gains and property income returns
2) Accounting services for contractors
3) Professional VAT advice and VAT filing
4) Filing of Self-assessment and personal returns
5) Preparation of accounts and returns, including all CT600 which are needed for limited company and small businesses

6) Enrolling you for pensions and payroll
7) Incorporation services for your company
From our offices near Enfield, we serve businesses and private individuals who need advice on tax, and how they can be compliant with tax regulations including meeting their deadlines.

We are known for being always up to speed on all the changes in HM revenue, the ever-changing accounting regulations, and the customs tax regulations in the UK. We have professional accountants who will get you on compliance and will help guide you on where expenses are likely to arise so that you can reduce your tax burden. Working with us, you can rest assured that we will always ensure on-time filing of self-assessment returns that is always accurate and punctual. Our firm has the best accounting packages for small businesses and we will help you prepare all your accounts and file them on time.

Limited Company Accounting

If you have a limited company we provide HMRC and companies filing and preparation of the CT600 tax returns. We do provide comprehensive packages that include bookkeeping, preparation of trial balances, and the final accounting, to ensure that you are in conformity with all regulations. We will also review all the accounting information to ensure that you can claim any allowable expenses.

With our assistance, you can let go of all the tedious accounting and bookkeeping tasks that you have had to do and instead work on more productive aspects of running and developing your business. Therefore, our services are customized to ensure that your business gets the care and attention of experienced experts in our company.

A limited company is a complex business entity and you need to understand important aspects about it including the fact that it is a legal entity. While the lines between the business and owner are very much blurred in a sole proprietorship, this is different from a limited company. While you could take out money from the business account as a sole trader, you cannot do the same with a limited company. All withdrawals from a company are only in the form of PAYE income. dividends, bonuses, or directors loans. With all the complications, it is important to engage an accountant before you even set up, to avoid any missteps.

Self-Assessment Tax Filings

Self assessment and the filing of returns tend to be a stressful and expensive affair though it need not be so. GM Professional accountants guarantee the efficiency at cost effective prices from our offices near Enfield, so that you do not have to stress out about your tax affairs.

Filing Your Online Returns for Self-Assessment

Working with us you can be certain that your filings are in the hands of tax professionals. We will consult with you on your returns and answer any queries about tax filing that you may have. Moreover, you will not have to enter into any extraneous contracts before we do this. Our office in East London offers this free of charge as a component of our tax filing and returns package.

Our expert tax accountants will prepare your filings correctly and in a timely manner so that you can be compliant at all times. They are professionals that will review all your filings to find any claimable expenses and help you maximize your allowances.

If you are running a commercial enterprise either as a self-employed person or as the director of a corporation, you are required by law to fill out and file self-assessment returns. Simple and accurate tax advice and planning are what you need to make your filings relatively pain free.

Capital gains tax

GM professional accountants provide expert advice on capital gains tax, you may be selling a home or have just sold some shares. we help you understand the implications and provide tax planning solutions for your needs. The capital gains tax allowance is renewed each year as your personal allowance. Its important to plan out disposals to maximise on the allowances.

Contractor accounting services

GM profesional accountants are specialist contractor accountants, we ensure that you are aware of the allowable expenses under the 24 month rule. We guide you on the vat schemes , as the rules have changed and the flat rate vat scheme has now become less attractive. We provide monthly packages for limited company contractors, this usually includes payroll, statutory accounts, CT600 filing, and the personal self assessment tax return.

Call us now for a free no obligation consultation.

Accountants in Covent Garden

Accountants in Covent Garden – West End

  • We are Specialist Small Business Accountants

  • We specialise in Self Assessment Tax returns

  • We provide Fixed Fees for all our services agreed in advance

  • Awarded the Three best rated Accountants

If you are looking for accountants in Covent Garden in the West end then you have come to the right place, with our offices in the central business district and a few minutes’ walk from Covent Garden train station. We understand how hard it can be to find a reliable local accountant who will offer the variety of services and needs that you as a person or business may require.

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We provide the following services:

  • Personal Self-Assessment tax return services
  • Small businesses Limited company services (We prepare and file accounts and CT600)
  • VAT advice and VAT returns
  • Contractor accounting services
  • Pensions and payroll auto enrolment services
  • Company incorporation services
  • Capital gains tax and property income tax
  • Self-Assessment and Self-Employed tax return services

From our base in Covent Garden in the West end, we provide our services to businesses and individuals. Among our services include general tax advice on the different packages we offer and assistance to help you meet any of your tax obligations before the deadline.

Unlike any other accountants in London, we have made a name for ourselves from our commitment to our clients, great skills and experience. We are known for always being ahead of the curve on any new developments in the accounting field including any changes in customs tax laws and HM revenue regulations and systems.

Our accountants will provide all the information you need to stay on the right side of the law, and the expenses that will arise from the different tax regulations. When you decide to work with our firm, we will ensure that we accurately file your tax returns and self-assessment accurately and in time. Our company also have some of the best packages for your small business that include the filing of tax returns and getting your company accounts in order.

Accounting for Limited Companies

We provide services to help file CT600 tax returns and accounts for HMRC and companies house. Our packages include everything from trial balances, bookkeeping, and preparation of final accounts to make sure that your business is compliant with all the tax regulations and laws in your jurisdiction.

This ensures that all the information that you file is accurate for each task and that you get to enjoy allowable expenses that reduce your tax burden.   With our services, you as a small business owner can save time for more important business activities as you will not have to do tedious bookkeeping tasks.

As such, our accounting firm designs packages that will take care of your business affairs with caution and expertise borne of experience, while still having that personal touch. It is critical to understand the formation of a Limited company as a separate legal entity and the tax obligations that come with such a designation.

As a sole trader, you have no restrictions on how you use the money the business makes as there is no distinction between the business and the owner. As a limited liability company, money can only be taken out of the business bank account as bonuses, PAYE income, dividend, or directors’ loans. The rules that govern the operation of a limited company and the tax obligations can become quite complicated, making it critical to engage the services of an accountant right from the start.

Self-Assessment Tax Return

The preparation and filing of self-assessment returns need not be an expensive or stressful affair. From our offices in West end. Working with us on your self-assessment returns means you get to enjoy hassle-free, affordable and cheap tax returns without having to leave Covent Garden.

Online Filing of Self-assessment Tax Returns

When you give us your business you can rest assured that your returns are being handled by professional tax experts. Our experts will answer any questions and provide advice on any queries you may have without any obligation on your part. The service comes free with our tax return package in Covent Garden and the entire London. Our professional tax accountants are always on hand to prepare and process your tax returns accurately and fast so that you never have to deal with any noncompliance penalties.

Moreover, they will use their expertise and experience to review your filing so that you can get the maximum tax refund that you deserve. Additionally, they will also provide advice on personal tax return expenses that you can claim to reduce the amount of tax payable.  If you run a business either as a self-employed individual or as a company director, you need to submit self-assessment tax returns. Getting simple advice on how to file accurate returns and on tax planning can go a long way in ensuring that the tax return filing process is as painless as it can be.

 

Address: Amadeus House, 27B Floral Street, London, WC2E 9DP

Accountants in Camden Town

Finding a local accountant near  Camden Town

GM Professional Accountants

Why not contact us today on  0208 396 6128 for a free consultation

  • GM Professional accountants are Specialist Small Business Accountants

  • We provide Fixed Fees for all our services agreed in advance

  • Awarded the Three best rated Accountants

Trying to Find a local accountant near Camden can be challenging, GM professional accountants specialise in the following:

  • Small businesses Limited company services (Preparation and filing Accounts and CT600)
  • Contractor Limited company services
  • Company incorporation services
  • Self Assessment Tax return services and Self employed Accounts
  • Property income tax and capital gains tax
  • Payroll and pensions auto enrolment services
  • Vat returns services and vat advice
  • Bookkeeping services
  • Personal Self Assesment tax return services

 

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We believe communication is key, we regularly keep you put to date with the deadlines, so that you can concentrate on your work. We have been included in the three best rated accountants website for providing excellent service. Our clients are kept up to date and informed in advance on their filing deadlines. We go the extra step with our reminders and phone calls to ensure that you understand the process. We also focus on the area of allowable expenses to ensure that you are claiming the right expenses in your field.

Limited Company Services

For limited companies that are new startups, we know that you will need extra support, we provide general tax advice in all our packages. This ensures that you are in control and have the right information to make an informed decision. It is important to appoint an accountant at the start of your business, this will ensure that you do not encounter the directors loan account pitfall. This is a common area where individuals do not differentiate between the company and their own money. With MTD Digital coming into effect in April 2019, you will need to keep electronic records and comply with the new legislation.

All limited company directors will at some point need to do a personal tax return. This is matched simultaneously with the company accounts. you can be withdrawing the income as PAYE, Dividends, or bonuses.

Self employed accounts and self assessment Tax return

We provide simple and easy packages for self employed individuals, it is important that you register at the latest by the 5th October to obtain your UTR number. This is the number that is need to file your self assessment tax return. The tax year runs from the 6th April till the 5th April.

Property Income tax

We provide rental accounting and tax services for income from property. Things are now getting more difficult with the new Mortgage interest restriction and the abolishment of the wear and tear allowance. You will now need look at the renewals method and ensure that the correct amount is being claimed.

Contractor Accounting services

We have tailor made packages for contractors , whether your inside IR35 or outside IR35. We can assist in you both and file you RTI returns monthly or issue the dividend vouchers. With the new limited cost trader rules, the FRS vat scheme is becoming less attractive and we can ensure you maximise on the input vat which is within the law.

Capital gains tax 

Our firm specialises in Capital gains tax , We have assisted many individuals to claim the PPR and Letting relief to reduce the Capital gains tax. This can be planned in advance and it is important to obtain advice at an early stage. CGT is misunderstood by many and this can lead to an inflated tax bill if your not careful.

 

For further information on Accounting and Tax Services ,

Contact GM Professional Accountants today on 0208 396 6128

 

Accountants for Contractors

Accountants for contractors

When deciding to contract, it’s important to  understand the benefits of a limited company. The first real benefit is that it has veil of corporation. This means that you are not directly responsible for the debts of the company. The company is a separate legal entity and you are an officer of the company and in most cases taking a salary , dividends, or bonuses.

Go professional accountants have tax planning strategies to ensure you get the right balance between these streams of income. This can help Lower corporation tax as well as personal tax.

 

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The filing requirements for contractors

After incorporation you have 12 months till the accounting period end. At this stage you will need to produce statutory accounts, CT600 and abbreviated accounts. You will need to file accounts after 9months from the period end. The corporation tax is payable 9months and 1 day after the period end. accountants for contractors London

Personal tax

If you are taking a salary or dividends . You will need to keep note of these as paye taxes are collected monthly/quarterly.  Dividends are calculated per tax year in your personal self assessment. This runs from the 6th April till the 5th April. The personal taxes are due on the 31st Jan. 

Expenses for Contractors

This is a common question for contractors and dependent on IR35. If you are outside IR35 and in a temporary contract under 24 months. Then travel and subsistence is usually allowable. This is normally the main expense for contractors. This must be reasonable and not excessive as with any other expenses.

Why choose GM professional accountants

Gm professional accountants specialise in contractors. We ensure you understand the complexities of contracting and provide tailor made solutions to suit your needs. Call us now for a free quote

How to handle a personal tax investigation 

How to handle a personal tax investigation

How to handle a personal tax investigation

How to handle a personal tax investigation

A considerable number of businesses will confront a regular tax investigation at any time of normal operation. More serious duty review is likely if HMRC doubts that your tax returns are incorrect.  A tax investigation or inquiry is certain to be a very difficult and stressful situation which can be quite costly in the long-term to resolve if it takes a long time to settle. Also, if you find that you are overly distracted by an HMRC tax investigation, it is likely to cause difficulties in being able to properly concentrate on your day-to-day activities of running the business. Be free to take an expert advice where you can`t settle tax audit by your own just after it starts.

Likelihood of a tax investigation

You ought to expect regular tax investigation in case you are enlisted for VAT or other have workers paid via PAYE. The duty audits will inspect your records and frameworks, concentrating on commonly mistaken areas.   Routine tax reviews are considerably less likely with regards to income duty or organization tax. Rather, the attention is emphasized on tax audits where HMRC has the motivation to trust you are either committing mistakes or intentionally concealing income.   Normally, tax reviews can be done after a period of five years, while just a couple of per cent of wage duty and company tax return are investigated every year.  Some of the most noticed reasons for the HMRC to start an investigation include records that differ vastly from similar business in the same industry, using round numbers on all entries and not the exact figures, unexplained or unusual fluctuations in the declared amounts, low-quality record keeping, a tip-off from a tenant or disgruntled employee, and certain high risk areas of business, such as construction or jobs that are likely to involve cash payments. Also, about three per cent of investigations is started on a purely random basis.

Tax investigation notification

The investigation process starts with the arrival of a letter from HMRC, indicating to you that an inquiry has been initiated into your financial affairs. Usually, you will be asked to clarify certain things and submit a few business records and therefore, you will need to take the right action to make certain this situation is resolved as effectively as possible.

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Dealing with a tax audit

On first getting the notification of being investigated you need to avoid getting into a panic and stay calm. Even in those situations where you have made errors on your tax return, you might still find that it is possible to rectify the issues by making any payments due as soon as possible. Unless a tax return features many intentional errors of a significant size, there are very few instances where a case ends with a custodial sentence.  You ought to seek guidance soonest possibly after notice of a tax investigation.  You might need to request that your bookkeeper checks your records and frameworks. The tax review will be snappier, easier and not most likely to prompt punishments if you can provide precise, updated data when the reviewer visits. It is best for you to get in touch with a tax audit specialist, who can guide you about the proper course of action to be followed from here. Quite often, expert help may lead you to identify oversights or errors on your part that could have given rise to the inquiry. You may attempt disclosing the same to the HMRC and working out a quick settlement with least amount of penalties.  In most of the tax investigations, HMRC carries out a complete review of your business matters. They may even delve into private affairs, such as investigating your expensive personal possessions. You will be requested to meet their inspectors for in-depth questioning. They might also ask you to provide comprehensive explanations and records to prove your statements. When it comes to providing any requested information or meeting with an investigator, you really want to remain truthful and provide the necessary information. Lying to the HMRC investigators is just likely to course more problems over the course of the tax review. Also, you want to make certain to be fully prepared for an in-person meeting and offer any evidence requested.

Once a duty audit has begun, it can take a few months or even more. Your bookkeeper can advise you on the way forward if HMRC is demanding too much data, taking a long period of time or generally acting irrationally.

 

Claiming Your Tax Rebate

Claiming Your Tax Rebate

Claiming Your Tax Rebate

Claiming Your Tax Rebate

It is estimated that 1 in 3 people in the UK have overpaid on their taxes but are not even aware of it. This means that you too could be due a tax rebate which could amount to several hundreds or even thousands of pounds. Applying for a tax rebate typically means filling in numerous forms and completing a number of calculations and if you don’t have any experience of dealing with this kind of thing (which very few of us really do) then you may consider it to be too much hard work or your tax rebate claim may be unsuccessful despite having a genuine case.

The actual amount of tax you are required to pay on an annual basis will depend on your personal circumstances as well as how much you earn but it will usually amount to several thousands of pounds and could be anywhere from around one fifth of your total earnings to nearly a half.

If you have overpaid for any reason then you are entitled to claim a tax rebate and receive that money back. After all, it is money that you have worked hard to earn so why shouldn’t you claim it back if you have unknowingly overpaid? Whether you have only worked a part of a year, were made redundant part way through the year, or you are set to leave the UK you may be due some tax back.

The difficult financial situation that many of us find ourselves in means that every penny counts and none of us can really afford to lose an average of nearly 1,000 from our annual salary. You could spend the money on a family holiday, on paying bills, or on updating and upgrading your car. Most of us place our faith in our payslips, our employers, and the Inland Revenue to get taxes right and we don’t even check that we are being charged the correct amount. If you are part of a PAYE scheme then you could be owed several hundred pounds in backdated, overpaid tax and you should consider starting
a tax rebate claim in order to try and get this money back.

How to Calculate Your Tax Rebate Effectively

A number of taxpayers keep a check on all these issues with the help of a professional accountancy services provider. They help them in managing their accounts and keep them updated with such type of news so that they can file all the documents on time. Several tools are also available in the market, which is capable of estimating your amount for a return. These tools demand an input of all the relevant information for computing your return on the income tax that has been paid. These tools are available for free of charge and are very easy to use. If you are not willing to use these tools, you can always opt for professional accountants who will assist you in this task and provide you with refund estimation
in advance.

Every nation has different tax policies which depend on various internal factors. Thus, for estimating most accurate amount, you will need to provide certain personal information like marital status, yearly income, number of dependants, age, etc. These factors will define that for what amount of tax  refund you are liable. If any exemptions are there, the accountants will consider the factors from above to provide estimations.

Generally, the government decides if any year requires them to provide tax rebate to people who have made more tax due to some erroneous calculations. A rebate is decided for all the eligible tax payers by taking in account their different activities. This figure depends on different policies and from nation to nation. There are different schemes introduced every year in a country based on the current progress. They are provided as a facility to the citizens for cutting down on their taxes. These generally include different forms of investments, donations and various personal factors like if someone has low salary, belongs to armed forces, a widow, etc.

A lot of the above things depend on your accountant’s skill and the way they deal with it. It is always better to file your tax return on time to avoid any penalties which might cost you much more than what you had to pay. While working for your business, you tend to forget these things because of the daily work tasks that require much more attention. If you fail to abide by the deadlines which are set by governing bodies, it will become difficult for you to get any exemptions because of your bad record. This is the reason that putting all this in the hands of professional is a much better option.

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How to maximise your CIS HMRC Tax rebate

Claiming Your Tax Rebate

It is estimated that 1 in 3 people in the UK have overpaid on their taxes but are not even aware of it. This means that you too could be due a tax rebate which could amount to several hundreds or even thousands of pounds. Applying for a tax rebate typically means filling in numerous forms and completing a number of calculations and if you don’t have any experience of dealing with this kind of thing (which very few of us really do) then you may consider it to be too much hard work or your tax rebate claim may be unsuccessful despite having a genuine case.

Contact us now

 

How much Tax have you Paid

CIS Tax rebate in London

The actual amount of tax you are required to pay on an annual basis will depend on your personal circumstances as well as how much you earn but it will usually amount to several thousands of pounds and could be anywhere from around one fifth of your total earnings to nearly a half.

If you have overpaid for any reason then you are entitled to claim a tax rebate and receive that money back. After all, it is money that you have worked hard to earn so why shouldn’t you claim it back if you have unknowingly overpaid? Whether you have only worked a part of a year, were made redundant part way through the year, or you are set to leave the UK you may be due some tax back.

The difficult financial situation that many of us find ourselves in means that every penny counts and none of us can really afford to lose an average of nearly 1,000 from our annual salary. You could spend the money on a family holiday, on paying bills, or on updating and upgrading your car.

Most of us place our faith in our payslips, our employers, and the Inland Revenue to get taxes right and we don’t even check that we are being charged the correct amount. If you are part of a PAYE scheme then you could be owed several hundred pounds in backdated, overpaid tax and you should consider starting a tax rebate claim in order to try and get this money back.

How to Calculate Your Tax Rebate Effectively.

A number of taxpayers keep a check on all these issues with the help of a professional accountancy services provider. GM professional accountants help them in managing their accounts and keep them updated with such type of news so that they can file all the documents on time. Several tools are also available in the market, which is capable of estimating your amount for a return. These tools demand an input of all the relevant information for computing your return on the income tax that has been paid. These tools are available for free of charge and are very easy to use.

If you are not willing to use these tools, you can always opt for GM professional accountants who will assist you in this task and provide you with refund estimation in advance. Every nation has different tax policies which depend on various internal factors. Thus, for estimating most accurate amount, you will need to provide certain personal information like marital status, yearly income, number of dependents, age, etc. These factors will define that for what amount of tax refund you are liable. If any exemptions are there, the accountants will consider the factors from above to provide estimations.

Generally, the government decides if any year requires them to provide tax rebate to people who have made more tax due to some erroneous calculations. A rebate is decided for all the eligible tax payers by taking in account their different activities. This figure depends on different policies and from nation to nation. There are different schemes introduced every year in a country based on the current progress. They are provided as a facility to the citizens for cutting down on their taxes. These generally include different forms of investments, donations and various personal factors like if someone has low salary, belongs to armed forces, a widow, etc.

A lot of the above things depend on your accountant’s skill and the way they deal with it. It is always better to file your tax return on time to avoid any penalties which might cost you much more than what you had to pay. While working for your business, you tend to forget these things because of the daily work tasks that require much more attention. If you fail to abide by the deadlines which are set by HMRC, it will become difficult for you to get any exemptions because of your bad record. This is the reason that putting all this in the hands of professional is a much better option.

 

Call nowCovent Garden office address, Amadeus House, 27B Floral Street, London, WC2E 9DP, Ilford office address, 14 Clements Court, Clements lane, Ilford,Essex, IG1 2QY Tel: 0208 396 6128,