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LITRG’s 19 recommendations are aimed at making the tax system easier for unrepresented taxpayers to understand and navigate, whether they are on PAYE or in self-assessment. Introduction The LITRG has published a manifesto setting out the agenda the Group would like the next government to pursue for taxpayers on low incomes. The overriding theme is that those who cannot afford to pay for tax advice should receive clear guidance, and that they should not be prejudiced by: disproportionate ... Continue Reading

The meaning of “plant and machinery” is notoriously difficult to pin down. The word “plant” typically conjures up images of complex mechanical kit with lots of pipes and switches, but there are some surprising examples of other assets that are accepted as falling within the definition. Animals offer one example, as long as they do not form part of the trading stock of a business (and as long as they are not the subject of a herd basis election, for which separate tax rules ... Continue Reading

Where a taxpayer owns a property as his or her main residence but is obliged to live elsewhere in job-related accommodation, the property could be deemed not eligible for PPR relief. However, the relief will apply when, during the period of ownership, the taxpayer: • resides in other job-related accommodation; and • intends to occupy the first property as his only or main residence at some time. This ‘job-related’ provision is only possible if it is necessary or customary ... Continue Reading

Key Highlights:  2015/16 personal allowance                                                    £10,600 Annual investment allowance until 31 December 2015            £500,000 Corporate tax rate from 1 April 2015                         ... Continue Reading

There are numerous reports in the press about a well-known television presenter, whose daughter also owns shares in his personal company. The suspicion of many is that this is underhand tax avoidance, assuming that the presenter’s daughter receives dividends which will not be as heavily taxed as they would be, if they were solely in the presenter’s name. I suspect, however, that many of those outraged newspaper readers would not think twice about employing their children or spouses to ... Continue Reading

The Telegraph and other news sources are running a news story that the Chancellor will announce a major review of Business Rates in this week’s Budget. This would be welcome for many businesses. Small Business Rate Relief (SBRR) has been going on for years with the kind of longevity normally reserved only for the politically charged fuel duty rise. (But, each time, extended only on a temporary basis). However, some readers might perhaps have been wondering if this were in fact news at all: ... Continue Reading

Should a property that was initially a main residence be converted into flats and sold, PPR 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 to establish the additional profit ... Continue Reading

Ray Chidell on Capital Allowances fixtures elections in commercial properties – and a notable recent tax case which supports the “just and reasonable” basis. Capital Allowances and Fixtures in Commercial Properties Capital allowances can offer very valuable tax relief when constructing or buying a commercial property. The allowances are given for the cost of fixtures, which will include all the electrical wiring and plumbing costs, heating and air conditioning, alarm systems, ... Continue Reading

If one spouse/civil partner owns rented properties solely in their own name but is a higher or additional rate taxpayer and the other spouse/civil partner is not, it would be beneficial for at least some of the rental profit to be taxed on the spouse/civil partner. To alter the income tax percentage charged, ownership of part of the property must be transferred into the other spouse/civil partner’s name. However, should the owning spouse/civil partner not wish to transfer any material percentage ... Continue Reading

LITRG clarify the new Marriage Allowance available from 6 April 2015 for those married or in a civil partnership where one person has an income of less than £10,600. Introduction On 20 February 2015, HMRC announced that people can register their interest in the new ‘marriage allowance’. From 6 April 2015, if you are married or in a civil partnership and one of you has an income of less than £10,600, you may be able to claim the new allowance. However, the adverts seem to ... Continue Reading