Accounting for use of home really does point out the differences between running a business as a director / shareholder of a limited company and running a business as a sole trader. Running your business as a sole trader allows you to claim tax relief for costs, charged to you as an individual, that you can […]
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How much salary/dividend? Director and Shareholder in a Limited Company.
It is generally accepted that it is more tax efficient for a director/shareholder to extract profits from a company as a dividend rather than a salary. To optimise your earnings my calculations suggest a 3:1 dividend/salary mix. Tax rates pretty much keep in alignment throughout the tax system be it sole trader, employee, corporation or dividend taxation. There are differences but it is swings […]
Small Company Director/Shareholders – Company Cars and Vans
Personal taxation on company cars has been increasing for years particularly on private fuel benefit. Whether there is a financial benefit from having a car and fuel financed through the company really needs to be looked at carefully on an individual basis. My reckoning says unless you want an expensive zero emission vehicle and will […]
What can I claim for? Clothing and Subsistence
Always a question that I get asked. Clothing is easy, subsistence is not so easy. Whenever you think about whether you claim for this or that as a business expense think about how the HMRC will view it. Their mantra is “wholly and exclusively” and they will also want to consider the “duality “of an expense. […]
Pension Changes 2015
Blimey, it’s a big change and one that changes the way you’ll think about investing your money into a pension. Mr Osborne has changed the pension fund rules in quite a substantial way. As of April 2015 you basically will have access to your whole pension pot at the age of 55 and not be […]
Employment Allowance
As of 6th April 2014 the government has introduced an ’employment allowance’ of £ 2,000 for all businesses and charities. Effectively a £ 2,000 nil rate band on employer’s national insurance the allowance will benefit all businesses that currently pay employer’s national insurance as part of their payroll. Whether you are a sole trader employing […]
Claiming for VAT using the sole trader simplified expenses scheme?
So you are a sole trader but you happen to be voluntarily VAT registered, how do you account for VAT on the approved mileage payments that you are showing as vehicle expenses on your tax return. I love accounting – yes I do especially when you get a hot topic that everyone wants to debate. […]
Annual Investment Allowance (AIA)
The Annual Investment Allowance (AIA) was £ 250,000 for this closing tax year 2014 and this coming year sees it hiked up to £ 500,000. Considering it was £ 25,000 in 2012 you’d be forgiven if you just thought they accidently added another zero. AIA is the level at which you can claim tax relief […]
Being self-employed – What you need to do
If you’re newly self employed there’s a lot to think about, as you’ve probably already realised. So, what do you need to do to keep within the taxation laws? And what would you need to supply the HMRC with, should they want to look at your business accounts. As a sole trader the legal requirement […]