My husband and I jointly own a rental property, the income of which we declare 50:50 on our Tax Returns. I have been promoted and will be a higher rate taxpayer going forward. Is it possible for my husband to be taxed on a greater proportion of the rental income as he is a basic rate taxpayer?

The UK tax system is complicated but research and development
(R&D) tax credits can be especially tricky to understand.

That’s partly because what counts as R&D, and what amounts
to true innovation, is judged on a case-by-case basis against
criteria that can seem almost abstract.

My client has left their main residence to their children through a discretionary trust in their will. If a deed of variation is done within 2 years of the date of death would the residence nil rate band still be available?

My client company has a year-end of 31st May 2019 and throughout the year the company incurred capital expenditure that qualifies for the annual investment allowance (AIA). How do we determine the amount of AIA available and how do we allocate the AIA to the qualifying expenditure given that the amount of AIA went up from £200,000 to £1m in January 2019?

Many of my small company clients often have overdrawn director loan accounts. When considering minimising the beneficial loan charge, what interest can be taken into account to reduce or cancel the benefit charge?

My Client owns 100% of an investment property and wishes to transfer a beneficial interest in the property to his wife. I have just read an article on the internet that states he can do this by passing on a 99% entitlement to the income from the property but only a 1% interest in the capital proceeds. The author claims that HMRC Manual PIM1030 supports this view.

Australia has used a so-called “backpacker tax” to illegally tax foreign workers from eight countries, according to a landmark ruling.

How will the Employment Allowance reform coming into play from April 2020 affect my business?

A business has started paying fee protection insurance. The business has taken out the cover directly with the insurance company. Will it be allowable for tax?

From 6 April 2020, HMRC is proposing three significant changes which will potentially increase the capital gains tax paid on the disposal of any residential property by an individual.

My client, an individual, recently made me aware of a loan he had made to a trading company which has since ceased to trade and become insolvent. (more…)

For most people living in the UK, the question of what income and gains should be included on their tax return is an easily answered question because they are both UK-domiciled and UK tax resident. Anyone domiciled and resident in the UK needs to report their worldwide income and capital gains on their return. (more…)

My client originally subscribed for 50,000 £1 shares when he set up his company. He now feels that the company is over capitalised and would like to return some of the share capital back to himself. He wonders whether the company could enter into a share buy-back or alternatively perhaps he could simply cancel some of the shares and receive the original capital. (more…)

Following on from our recent webinar where we looked at a general overview of R&D, Capital Allowances and Patent Box Tax Reliefs, the next in our series of webinars will delve deeper into each relieves and as the title suggests, debunk some of the most common misconceptions. (more…)

I understand that Entrepreneurs Relief is now given for new incorporations so that, on incorporation, an existing sole trader would immediately meet the qualifying conditions even though they would not have owned shares in a qualifying company for a sufficient period. Is this correct?
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Jack and Jill started living apart in November 2018 but there was then no contemplation of a divorce. In May 2019 they discussed their situation and at that point in time decided to get divorced. They agreed to get divorced in January 2020. (more…)

With the 2018/19 P11D deadline looming, should I be considering payrolling benefits in future? What is the advantage? What do I need to do and when?
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Working from home offers all kinds of benefits, from the opportunity to create the perfect environment in which you can be most productive, to the improvements to work-life balance that come with ditching the commute. (more…)

My client owns a joint share in the freehold of a building which consists of five flats. One of the flats is occupied by my client under a 999-year lease.
The freeholders are to grant a new long lease over another flat in the building. My client understands that this will be a capital gains disposal event, but has queried whether a measure of principal private residence relief would be due to him, given that the disposal is out of the freehold interest he owns that includes his main residence.

Can you please confirm how to approach my client’s capital gains position, whether any main residence relief would be due to him in these circumstances and how this would be calculated? (more…)

My clients have inquired about the possibility of claiming relief for expenses incurred in connection with closing down their company. In particular, they would like to know whether they could get tax relief for professional advice that they have taken and whether they can arrange for the company to make pension contributions on behalf of employees.
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My employer has heard of a new combined life policy which also covers critical illnesses and claims that there is no taxable benefit on the premiums. Is this correct?
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This question is based on a call to the Advice Lines where a client never had the intention to be a landlord for very long. He had fallen into those circumstances because it had been difficult to find a buyer for his property when he moved home – not an uncommon situation. His hesitation to sell the property once the market improved resulted purely from the mortgage redemption fee that would be triggered.
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We recently received a question to the advice lines regarding a family company and the availability of entrepreneur’s’ relief (ER) with regard to different classes of shares in issue.
A total of 11,000 shares are in issue made up of A and B shares. Mother and father own 10,000 A shares and their adult child owns the other 1,000 B shares.

The A shares have full voting rights, full dividend and full rights on disposal of the company. The B shares have full voting rights, full dividend and no rights on disposal of the company. (more…)

My client is a long-term resident of the UK for tax purposes. However, she is non-domiciled and has been using the remittance basis for her foreign income as it is below £2,000. As she will now have been here for 15 of the previous 20 tax years, will she be caught by the Deemed Domicile rules?
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Our pay period runs one week in arrears and we are due to pay employees on Friday 5th April for the work that they did during the week 25th – 31st March. What rate of pay should they be paid at, as we are aware that the National Living Wage rate has increased?
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My client has made a directors loan to his personal company (he is the majority shareholder) which now cannot be repaid. Is there a loss for CGT and if so, is it a ‘clogged loss?’
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Question
Has the tax relief for childcare vouchers ceased?

Answer (more…)

My client is an expanding local mobile care business and they are increasingly aware of the pollution that cars emit into the environment. With this in mind, they have been asked by their team whether they can look at changing the company cars to hybrid or electric cars and whether there are any incentives to do so.

Here we look at some of the recent changes and existing exemptions that may help them to make their minds up. (more…)

How do the new company car tax bands favour ultra-low emission vehicles (ULEVs)?
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If there’s one thing accountants love, it’s identifying obscure tax reliefs to which you may be entitled and using them to reduce your tax bills.

Tax reliefs, or tax breaks as they are sometimes called, aren’t without controversy, however. There are too many of them, say critics, and they deny the public purse much-needed funds.

Read the full aeticle here.

Thousands more landlords are being pursued by the taxman as part of a drive to catch out those investors underdeclaring property income, figures obtained by Telegraph Money have revealed.

Read the Full Article Here

My client has asked me about the new legislation regarding payslips that comes into effect in April 2019. Can you shed some light on this?
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Tax Cards 2019/20 PDF

Now that the self-assessment filing date of 31 January has passed once again, I would like to be able to understand and explain to clients the penalty regime that will apply if their returns have not been filed on time.
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Year-End Tax Guide 2018/19

How do the new company car tax bands favour ultra-low emission vehicles (ULEVs)?
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Jack and Jill jointly own two investment properties and wish to swap their interests so that they each have ownership of one of the properties. As tenants in common they currently equally own Cornfield with a market value of £210,000 and the original cost of £50,000 and Wheatfield with a market value of £200,000 and the original cost of £49,000. Jack is to have Cornfield and Jill is to have Wheatfield. What are the CGT and SDLT implications?
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This months edition includes:

– Stamp duty tax break saves first-time buyers £284m
– HMRC confirms ‘soft landing’ for Making Tax Digital
– Inheritance tax receipts reach record high of £5.2bn
– SMEs cite VAT as ‘biggest administrative headache’

Read the full article here.

Is tax relief available for training costs when setting up a new trade in a limited company?
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HM Revenue and Customs (HMRC) announced its new Making Tax Digital (MTD) in the March 2015 Budget but since then, there have been many consultations and changes in the implementation dates. The aim is for HMRC to be interacting digitally with all taxpayers.
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