Update on the VAT reverse charge for building contractors

From 1 October 2019, contractors who employ subcontractors, will need to assume responsibility for declaring and paying the VAT that was previously settled by their VAT registered subcontractors. From this date, registered subcontractors will no longer add VAT to their invoices and main contractors will pay this net of VAT amount. Now the challenging part. The main contractor will then add the appropriate...

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Legal and professional fees and property transactions

We are often asked to explain if the professional fees you pay, associated with a property transaction, are a tax allowable deduction. The straight-forward answer is yes, they are, but it is necessary to consider the reason for which a property is purchased to determine which taxes are reduced by such payments. Simplistically, if you buy a property with the intention to...

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Muras Matters: Student Loan Repayments

Background Most people are familiar with the basics surrounding the student loan repayment system and the normal course of action is generally to see repayments made through the payroll for the individual concerned. However, for those individuals who are self-employed repayments will instead be made under the self-assessment tax system and for those taxpayers there are a couple of important points to remember. In addition, when approaching the end...

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CGT giveaway?

The awkwardly named “Gift Hold-Over Relief” (GHOR) allows you to give away business assets – including certain shares – or sell them for less than they are worth, and not pay (or pay reduced) capital gains tax (CGT). The person receiving the gift will potentially pay CGT when and if they sell the asset at some future date. Any taxable gain...

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Muras Matters: Offshore Income & Gains “Nudge Letters”

Background Over recent years HMRC has been exchanging more and more information with other countries in an attempt to identify where taxpayers have received income and gains from overseas sources but not declared them, either deliberately or accidentally. As a result of information received from other countries HMRC are writing to taxpayers where they have reason to believe they may have received income that has not...

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Have you heard of the Prompt Payment Code?

The Prompt Payment Code (Code) is not a fanciful device to access cash from bank machines or a way to secure automatic “prompt” payment from your customers. The Code was actually set up by the Chartered Institute of Credit Management (CICM) on behalf of government in order to promote a culture of prompt payment. Signatories to the Code agree to pay...

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What exactly is insolvency?

The dictionary definition of insolvency is less than illuminating, it is: The state of being insolvent… Listed synonyms provide more detail: bankruptcy · liquidation · failure · collapse · ruin · financial ruin · ruination · pennilessness · penury · impecuniousness · beggary · administration · receivership · folding · pauperdom What these explanations do not provide is a definition of the state of...

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Complaining to HMRC

Although many of the tax office processes are automated, dealt with by computerised systems, the rest is managed by human beings each subject to the same range of foibles as the rest of us. And we all know how reliable computerised systems have proven to be. If you are certain, or have misgivings, about the accuracy of HMRC’s assertions regarding your...

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Complaining to HMRC

Although many of the tax office processes are automated, dealt with by computerised systems, the rest is managed by human beings each subject to the same range of foibles as the rest of us. And we all know how reliable computerised systems have proven to be. If you are certain, or have misgivings, about the accuracy of HMRC’s assertions regarding your...

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The real tax cost of benefits in kind

There is a sting in the tail for companies that provide their directors or employees with taxable benefits as part of their remuneration package. Obviously, the directors or employees that receive the benefits will pay additional income tax if the benefits provided are chargeable to tax: for example, the use of a company car. The cost of the benefits is generally a...

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