Category: Tax

HM Revenue and Customs’ recent decision to scrap its controversial Business Records Checks has been roundly welcomed. The checks are a compliance procedure HMRC use to confirm a business is keeping sufficient information on its income and expenses to produce an accurate tax return. They have consistently been criticised for being ineffective and poorly targeted. … Continued

The corporation tax deduction for acquired goodwill and other intangible assets that has been available to companies since April 2002 mentioned above, has meant that companies buying other businesses have generally preferred to buy the trade and assets rather than the shares in the target business. However, the vendors would normally prefer to sell their … Continued

An important consideration when buying a business is tax relief for the plant and machinery of the target company. Where the shares of the target company are acquired, the new owners will inherit the tax written down value in the target company’s capital allowances pool which will normally be a lot lower than the market … Continued

Ever since April 2002 when a limited company acquires the trade and assets of another business it has been possible to obtain a tax deduction for the goodwill and other intangible assets of the acquired business, generally in line with the accounting treatment. So, if the goodwill of the acquired business was worth say £500,000 … Continued

The lifetime allowance is being reduced from £1.25 million to £1 million from 6 April 2016. Exceeding the lifetime allowance can have significant tax consequences: Lump sum withdrawals taken from the excess amount within your pension are taxed at 55% If you retain the excess amount within your pension fund, a 25% tax charge is … Continued

As announced in the spring 2015 Budget, a new personal savings allowance will be introduced from 6 April 2016. This will be £1,000 a year tax free for basic rate taxpayers and £500 a year for higher rate taxpayers, but nil for those with income over £150,000. As a consequence, tax will no longer be … Continued

The government announced in the Summer Budget that from April 2016, the current 10% Wear and Tear Allowance for furnished lettings will be replaced with a relief that enables all landlords of residential dwelling houses to deduct the costs they actually incur on replacing furnishings in the property. This will give relief for capital expenditure … Continued

HMRC has revealed how it plans to introduce digital tax accounts over the course of the 2015/16 tax year. First announced in Budget 2015, news that HMRC wants digital accounts to replace traditional annual tax accounts created much debate. Now, further details of what this transitional process will look have been provided by HMRC: July … Continued

Family businesses are being unfairly penalised by changes to entrepreneurs’ relief (ER), according to the Institute of Chartered Accountants in England and Wales (ICAEW) Tax Faculty. The amendments, passed into law through the 2015 Finance Act, prevent retiring partners from claiming ER if they are associated with people in the purchasing business. Likewise sole traders … Continued

No one quite knew what to expect in the first budget by a majority Conservative government for almost 20 years. In his seventh Budget Statement as chancellor, George Osborne promised a ‘big budget for a country with big ambitions’. As predicted there were details on how the government will fulfil its pre-election goals of reducing … Continued