current tax tips
Did you know that through the use of qualifying investments it is possible to arrange your affairs so that the whole of the value of your estate can pass to your your descendants completely free of Inheritance Tax?
Value Added Tax – Flat Rate for Small Businesses
Businesses registered for VAT with a total turnover of less than £150,000 may be able to take advantage of the flat rate scheme. This allows businesses to pay to Customs & Excise only a flat rate calculated on total gross turnover, varying between 2 and 13½ % depending on the nature of the business, irrespective of the fact that the VAT invoices issued to customers will show VAT at 20%.
No VAT input tax deduction is allowed against the flat rate calculation for calculating payments to the Inland Revenue, but the scheme is particularly worthwhile for businesses that have a relatively low rate of allowable input tax.
There can also be a substantial administrative saving, as the preparation of VAT Returns becomes a simple procedure of making one calculation based on total turnover for the period concerned. VAT arising on capital purchases can be claimed back under separate arrangements.
Individuals commencing self-employment are required to notify the Inland Revenue National Insurance Contributions Office within three months of the end of the month following the commencement of the self-employed business. Failure to notify within that period leads to an automatic penalty being applied of £100.
Companies commencing to trade or carry on a business coming within the corporation tax regime (including previously dormant companies which commence to trade) are required to give notice to the Inland Revenue of the commencement of the trade within three months of the end of the month in which the trade commenced. A penalty of up to £1,000 can be imposed for failure to notify.
Why not contact us today or telephone on 020 to discuss your requirements in more detail and find out what we can do for you. 7253 0030