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The Tax Code Is Not Logical And The Taxman Is Not Patient

On top of that HMRC makes a lot of mistakes. HMRC themselves in one year admitted that almost 5M people paid the wrong tax under PAYE. Tax evasion is taken very seriously by HMRC and criminal proceedings usually follow. The penalty regime in many cases is extremely harsh for late filings and mistakes. You MUST […]

Small Company Owners – Make Sure You Pay Yourself Properly

If you run a small owner managed Limited Company it is not a good idea to mix your business and personal expenses and payments A company is a separate legal entity even if you own all the shares and is governed by company law. Director/owners of Limited Companies can pay themselves remuneration either via a […]

Income Shifting – Are You Paying Your Partner

The tax rules seek to PREVENT someone gaining a tax advantage by arranging to divert his/ her income to family or friends taxable at a lower or nil rate. For example where a husband and wife own equal shares in their own company but the husband is the only earner. This piece of legislation is […]

Closing a Business

There is an important piece of legislation called ESC 16 which basically states that what’s left in a company on closure can be distributed to the shareholders as a capital distribution rather than as a revenue distribution as long as the amount does not exceed £25,000 without the company going through a formal dissolution process. […]

IR35 Personal Service Companies

Anyone that provides their services through a Limited Company needs to consider the legislation known as IR35 which was brought in by the government to prevent people paying substantially less tax and national insurance by operating through an intermediary such as a Limited Company instead of being employed directly by the client. Separate rules were […]

Don’t Mix Business & Personal Expenses

If  you run a small owner managed business it is not a good idea to mix your business and personal expenses. There is a very important principle and that is: A company is a separate legal entity in law even if you own all the shares This means that it is governed by company law. […]

Income Shifting – Are You Paying Your Partner A Dividend?

The tax rules seek to PREVENT someone gaining a tax advantage by arranging to divert his/ her income to family or friends taxable at a lower or nil rate. For example where a husband and wife own equal shares in their own company but the husband is the only earner. This piece of legislation is […]

Dividend Or Salary

If you run a small family run business you can pay yourself either via remuneration or via dividends. The freedom to use the company profits in the most tax-effective way has long been the goal of many owners. HMRC have sought to challenge this in some circumstances such as under the ‘settlement legislation’ and special […]

Do Small Sole Traders Need An Accountant

If you are sole trader and your service is fairly simple and there are no complicated tax issues you could probably do it all yourself. There is plenty of information online at HMRC’s website and elsewhere, however the question I would ask you is this.   Is it good use of your time?   Accountants […]