One of our clients contacted us to request assistance on a Private Residence Relief (PRR) case.
The client was a wealthy entrepreneur who had dabbled in the property development business and HMRC was now seeking to disallow PRR on the sale of their current home – not only because it was a substantially redeveloped property, but also because the property had an additional stretch of land attached to it which meant that the total area sold was over half a hectare.
Recent budgets have seen several significant changes to the taxation of income from letting out residential property. These changes are likely to impact on the taxation of all current property landlords, as well as future decisions as to whether to remain or become a landlord.
First-time buyers in England, Northern Ireland – and for a short time in Wales – were the biggest winners in the most recent shake-up to affect property taxes in Autumn Budget 2017.
Philip Hammond’s headline measure was to abolish stamp duty for first-time buyers on homes worth up to £300,000, and the chancellor didn’t stop there.
The pros and cons of letting furnished holiday accommodation.
When furnished holiday property is let on a commercial basis for short periods, the owner can benefit from tax reliefs which wouldn’t otherwise be available to residential landlords, providing certain conditions are met.
However, there are also several disadvantages associated with letting property as holiday accommodation whether or not the furnished holiday letting conditions are met.
Read the full article here.
Traders have been able to prepare their accounts using the cash basis since April 2013, as long as they meet certain eligibility conditions.
This option was extended to landlords running unincorporated property businesses from 6 April 2017.
However, while traders must elect for the cash basis, it applies by default to landlords who meet the qualifying conditions.
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Our summary of the latest budget, the first since Brexit! Download here
With the number of houses selling for more than £325,000 more than doubling since 2009, more and more people are falling into paying inheritance tax on their own home. Read more here
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No one should be without a financial plan.
Read our guide to get started.
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This issue details:
New minimum wages rates, New Apprenticeship funding, Property wealth v savings and pensions, IHT receipts
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Thresholds, exemptions, allowances, home and
giving away your estate.
Our client, Make it York, is working in conjunction with City of York Council and North Yorkshire County Council to assist those businesses who have been affected by the recent flooding in North Yorkshire.
The dust has settled on the autumn statement, and it is now clear on the good, the bad and the ugly effecting SME’s, employers and self-employed.
National Insurance employment allowance increased to £3,000 from April 2016
Extension of the doubling of small business relief rates to April 2017 (good news – make sure you have this if you operate from an office)
3% additional stamp duty land tax will be charged on second homes or investment properties purchased from April 2016, which in added to the reduced relief for interest previously announced from April 2017 is a double hit for active investors
3% differential on Benefit in Kind for diesel cars retained from April 2016 for 5 more years
Capital gains tax due to be paid within 30 days of completion of any disposal of residential property from April 2019. This ties in with the introduction of digital tax accounts for most taxpayers.
If you have any queries or concerns arising from the autumn statement, contact our team at Morrell Middleton on 01904 691141.
Thousands of families who set up “discretionary trusts” so they could leave property to children in a tax-efficient manner will miss out on the Government’s valuable new inheritance tax allowance unless they make significant changes to their will, it has been warned.
Homes left to children through a discretionary trust will not benefit from the “family home allowance”, worth up to £350,000 per couple from 2020, because assets do not pass directly to children. Discretionary trusts – the most common form of trust – were widely used in the past to minimise inheritance tax (IHT).
The tax increase, on which there was no consultation, will be phased in from 2017 and fully implemented by 2020.
The change was unexpected, and the new regime is highly complex, and many investors remain unaware of the change, or underestimate its severity.
The Chancellor’s 2015 Budget contained some Radical changes to Dividend and Rental Income – none of it good news!
Most business owners assume that their accountant will ensure that the tax bill each year is minimised – that’s what you pay our fees for isn’t it?
Unfortunately, with commercial property, many accountants do not make all the tax claims available as they don’t have the expertise to obtain the necessary information to make the claim in house. This means you could be missing out on accelerating how quickly you get tax relief for your investment, leaving the claim for your purchase cost until you sell the property which is likely to be years if not decades away. Under the current tax rates this also means that you could be obtaining tax relief today at up to 45%, compared to only 10% upon sale.
We’ve been helping organisations to prepare business plans and forecasts for many years. Without exception, it seems like a daunting task for the management team, but it’s really crucial to your success whether starting a new business or wanting to develop an existing business, to have a clear plan and that it can be articulated to the people who can help you make it happen.
“A lack of clarity could put the brakes on any journey to success.”
Steve Maraboli – Behavioral Scientist
Here are our top 10 tips for writing a business plan:
Now the dust has settled we have produced a 4 page guide to the relatively quiet 2014 Chancellors Autumn Statement for you to download here!
The amount of inheritance tax expected to be paid by families in the next few years will reach a level higher than at any time since the early 1970s, according to calculations by the Institute for Fiscal Studies.
Changes to the rights of people whose spouses or civil partners die without making a will have come into force.
For married couples with no children, the surviving partner will now inherit their spouse’s entire estate, rather than £450,000 then half of the rest.
HM Revenue & Customers (HMRC) have launched a new campaign targeting property landlords. The “Let Property Campaign” will encourage tax payers with undeclared income or gains to come forward voluntarily on the promise of preferential terms including having 3 months to calculate and pay the outstanding tax.
Tax crackdowns have arrived thick and fast in the past three years. Officials have targeted everyone from doctors to Avon ladies to claw back £35bn lost in unpaid tax each year – and more inquiries are in the pipeline.
Accountants claim that HM Revenue & Customs focuses on “soft targets” through special task forces that investigate specific job sectors.
According to the adulterous website, IllicitEncounters.com, accountants are the most exciting workers to go on dates with. Not because number crunching is a big turn on, but because their ‘boring’ jobs makes them more interesting in the bedroom, apparently.