03/08/2016, by Tax Insider, Tax tip - General Tax
The Annual Investment Allowance (AIA) is set at a temporary level of £500,000 a year from 1 April 2014 (corporation tax) and 6 April 2014 (income tax) until 31 December 2015. It reverts to the new permanent level of £200,000 from 1 January 2016.
Where the accounting period spans 1 January 2016, the maximum allowance for the period is calculated in two parts by reference to the periods falling either side of that date.In a transitional period the timing of the capital expenditure is important ... Continue Reading
01/08/2016, by Tax Insider, Tax tip - Property Tax
How does it work?
A ‘nil rate band’ (NRB) ‘Discretionary’ trust is created on death in a sum to include property equal in value to the inheritance tax NRB (£325,000 for 2015/16) or the settlor’s unused NRB if already part-used.
Each spouse/civil partner must own the property as ‘tenants in common’.
The surviving spouse has the legal right to occupy the property by virtue of ownership of their own half-share.
The trustees are deemed to own a beneficial ... Continue Reading
01/08/2016, by Low Incomes Tax Reform Group, Tax article - General
LITRG suggests that more should be done to support the financial position of unpaid carers, particularly the impact of tax, National Insurance and benefits administration and policy on them.
Introduction
LITRG welcomes the opportunity to respond to the Department of Health's consultation on unpaid carers. The consultation document explains that the government thinks a new strategy is needed for carers – one which reflects their lives now, the health and financial concerns they have, and gives ... Continue Reading
29/07/2016, by Low Incomes Tax Reform Group, Tax article - General
A senior member of the Low Incomes Tax Reform Group (LITRG) – the tax campaign organisation – has been appointed to the Social Security Advisory Committee (SSAC).
Introduction
Lord Freud, Minister for Welfare Reform, has announced that Victoria Todd has been appointed to the SSAC. Victoria, along with four other new appointees, Carl Emmerson, Dominic Morris, Charlotte Pickles and Liz Sayce, will take up her five-year term on 1 August 2016 and will continue to work for ... Continue Reading
29/07/2016, by Tax Insider, Tax tip - Business Tax
Paying contributions into a registered pension scheme can be an effective way of extracting profits from a family company.Employer contributions can be made without limit, although they count towards the annual allowance. Contributions made in excess of the annual allowance attract a tax charge, although to the extent it is unused, the annual allowance can be carried forward up to four years.As a result of aligning the pension input period (the period against which contributions are measured against ... Continue Reading
28/07/2016, by Low Incomes Tax Reform Group, Tax article - General
The LITRG and the advice and technology charity LASA have launched a web tool to help people check whether they can claim universal credit and tax credits in their postcode area.
Introduction: Revenuebenefits project
In 2012, the LITRG launched the award winning website www.revenuebenefits.org.uk. Funded by HMRC, the website is aimed at giving advisers detailed information about HMRC products including tax credits and child benefit. More recently it has launched a new section covering the transition ... Continue Reading
27/07/2016, by Tax Insider, Tax tip - General Tax
By ensuring that you pay any tax on time, you can avoid paying the HMRC non-deductible interest for the late payment of tax.Example:Peter files his Tax Return in March, and discovers that he has a liability of £1,000 for the year, which he paid on 16 March.Because he paid his tax late, he is liable for:
interest on the late paid tax; and
a further 5% late payment penalty because the tax was still unpaid on 2 March (30 days late).
He could quite easily have avoided the interest charge ... Continue Reading
27/07/2016, by Low Incomes Tax Reform Group, Tax article - Income Tax
You may not need to pay all of your second self-assessment payment on account if your liability for 2015/16 is less than it was the previous year.
Introduction
If you are in the self-assessment tax system, then you may be due to pay your second payment on account for the year ended 5 April 2016 by 31 July 2016. But you may not need to pay all of it, or indeed any of it, if your liability for 2015/16 is less than it was the previous year.
Self-assessment – payments on account
If you fill ... Continue Reading
25/07/2016, by Tax Insider, Tax tip - Property Tax
Should a property that was initially a main residence be converted into flats and sold, Principal Private Residence (PPR) relief will be denied in respect of the gain attributable to the period of ownership whilst the conversion is taking place as the expenditure has been incurred ‘wholly or partly’ for the purposes of realising a gain.For the calculation a valuation of the property as not converted is required and then that figure is compared with the sale price post conversion in order ... Continue Reading
25/07/2016, by Low Incomes Tax Reform Group, Tax article - General
The LITRG is urging people in receipt of tax credits to complete their renewals by 31 July to avoid their payments stopping.
Introduction
The majority of tax credit claimants have to renew by 31 July 2016 and LITRG is encouraging them to do so now to avoid any potential anxiety with struggling to get through to HMRC on deadline day or having their tax credits stopped if they miss the deadline.
Reminder that all claimants need to take part in the renewal exercise
LITRG cautions that even if you ... Continue Reading
