8 Useful Tips & Advice On Managing Your Taxes
1. Expenses
HMRC have recently updated the list of trade and professional organisations for directors and employees who receive a tax reduction for annual subscriptions. National Insurance can be avoided if bill expenses are paid directly by the employer.
2. Autumn Statement
Unfortunately the capital gains tax exemption on homes will be less generous but the good news is that no NI will be payable to employees under 21 from April 6th and business rates will be increased and capped at 2% for 2014/15.
3. Cars
Amending car policies ensures the director and the employee contributes to company car running costs via their taxes. You can pay your car tax in one immediate sum or by cash, cheque or credit/debit card.
4. Corporation Tax
There is an option of asking the bank for a loan or HMRC for extended time to pay, but nevertheless you will still be required to pay interest. So the best solution would be to extend the company’s accounting period to cover 18 months as this will combine the good and bad trading periods and in the short term decrease the payable corporation tax expenses.
5. Payments
You can request HMRC to allocate a payment against another tax bracket. Also, if you are not happy with your tax bracket, you can ask HMRC to reallocate the payments.
6. VAT
If the business turns over more than £85,000 of VAT goods and services then you must register for VAT Tax. If the company turns over less than this, then you can still choose whether to register for VAT. But another option would be to reclaim VAT on all fuel and repay that which relates to non-business travel.
7. Profit Extraction
For 2014/15 draw enough profit as dividends to increase your income for the year, otherwise leave it in the company so that it can be taken when/if you choose to sell the business with the tax rate being 10% in this case.
8. HMRC
HMRC will be communicating with taxpayers directly via email this year and if you would like to take part, it would be suggested to set up a new and clean email account to avoid official messages becoming lost in the spam or junk mail folder.
