March

 

1 March 2018

Welcome to the Exceed monthly newsletter.

 
 
A reminder to consider a carry back of charitable contributions Income Tax

Donations to charity over the course of a tax year can add up and taxpayers must ensure they keep a proper record of all donations to record them on their tax return. Donations that are made through the Gift Aid scheme allow for the recipient charity to claim 25p worth of tax relief on every pound donated. Higher rate and additional rate taxpayers are eligible to claim relief on the difference between the basic rate and their highest rate of tax.

For example:

If a taxpayer donates £500 to charity, the total value of the donation to the charity is £625. The taxpayer can claim additional tax back...

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Reasonable excuse for late filing of your tax return Income Tax

Taxpayers that have not yet filed their 2016-17 self-assessment returns will have been charged an automatic £100 penalty for late submission. The penalty applies from 1 February 2018 even if no tax was due or the tax due was paid on time.

In some cases, it can be possible to appeal against any penalty on the grounds of having a good reason for sending in a late return. However, taxpayers must have what is known as a 'reasonable excuse' for filing a self-assessment return late and ensured that the return was sent in as soon as possible following the deadline.

HMRC’s guidance lists the following...

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Income from selling services online Income Tax

Many taxpayers supplement their income by selling services online. This is often known as the 'sharing economy' or the 'peer-to-peer economy' and usually involves taxpayers renting out something they are not using such as their house (using websites such as AirBNB), car, car parking space or other personal equipment.

It can also involve taxpayers finding customers using specialist websites or apps and doing small jobs either online or in-person. The income raised from these kinds of ventures is usually supplemental to a taxpayer’s main income but this is not always the case. However, HMRC is...

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Nominating a home for tax purposes Capital Gains Tax

As a general rule there is no CGT payable on the disposal of a property which has been used as the main family residence. Conversely, an investment property which has never been used will not qualify for relief. This relief from CGT is commonly known as private residence relief (PRR).

It is increasingly common for taxpayers to own more than one home and there are a number of issues that home owners should be aware. An individual, married couple or civil partnership can only benefit from CGT PRR on one property at a time. However, it is possible to choose which property benefits from a CGT...

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Delaying tax with rollover relief Capital Gains Tax

Rollover relief is a valuable relief that allows for a delay in the payment of capital gains tax (CGT) on gains when you sell or dispose of certain assets and use all or part of the proceeds to buy new assets. The relief means that the tax on the gain of the old asset is postponed. The amount of the gain is effectively rolled over into the cost of the new asset and any CGT liability is deferred until the new asset is sold.

Where only part of the proceeds from the sale of the old asset is used to buy a new asset a partial rollover claim can be made. It is also possible to claim for provisional...

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Living abroad and selling UK home? Capital Gains Tax

A capital gains tax (CGT) charge on the sale of UK residential property by non-UK residents was introduced in April 2015. Only the amount of the overall gain relating to the period after 5 April 2015 is chargeable to tax.

In certain circumstances private residence relief may apply where a property is the owner’s only or main residence. For example, you don’t usually pay any tax for any tax years in which you, your spouse or civil partner spent at least 90 days in your UK home. In most cases, the final 18 months of ownership usually qualifies for full tax relief.

A UK non-resident that sells UK...

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More on inheritance tax shakeup Inheritance Tax

The Office of Tax Simplification (OTS) provides advice to the Chancellor on simplifying the UK tax system. In a letter dated 19 January 2018 the Chancellor Philip Hammond wrote to the OTS to request a review of inheritance tax (IHT) regime and asking to hear any proposals for simplification.

The Chancellor was particularly interested in focusing on the technical and administrative issues within IHT. The IHT rules have become more complicated as new provisions such as the residence nil rate band (RNRB) have been bolted on to the existing rules. In response, the OTS has published an IHT scoping...

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Pay and paternity leave Employee Benefits

When your partner gives birth or when you adopt a child or have a baby by surrogate, you may be entitled to 1 or 2 weeks paternity leave and paternity pay. You are also entitled to take a small amount of unpaid time off work before the baby is born to accompany your partner (or the surrogate mother) to 2 antenatal (or adoption) appointments.

You can take up to two weeks of paternity leave which must be completed within eight weeks of the birth. The rules are different for adoptions. You can choose whether to take 1 week or 2 weeks off, but you must take all paternity leave together.

You're...

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Does a charity pay tax? HMRC notices

The tax treatment of charities can be very complex. As a first step any charity hoping to benefit from any beneficial treatment needs to be recognised as a charity for UK tax purposes by HMRC as well as meeting other criteria.

A recognised charity may qualify for a number of tax exemptions and reliefs on income and gains, and on profits for some activities. For example, charities don’t pay tax on most types of income as long as they use the money for charitable purposes.

This includes tax:

  • on donations;
  • on profits from trading;
  • on rental or investment income, e.g. bank interest;
  • on profits from the...

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Tax-Free Childcare available now HMRC notices

The Tax-Free Childcare Scheme (TFCS) was launched in April 2017 to the first tranche of working parents. The scheme was initially made available to working parents of children aged under 4 on 31 August 2017. On 15 January 2018, the scheme was extended to parents whose youngest child is under 9. The scheme was opened to all remaining eligible families with children under 12 on 14 February 2018.

The TFCS helps support working families with their childcare costs. The scheme provides for a government top-up on parental contributions. For every 80p in the £1 contributed by parents an additional 20p...

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HMRC’s requirement to correct Overseas tax issues

The new requirement to correct (RTC) legislation was introduced by the Finance (No.2) Act 2017. The legislation created a new statutory obligation for taxpayers with undeclared UK tax liabilities that involve offshore matters to disclose any relevant information to HMRC by 30 September 2018.

The RTC applies to any person with undeclared UK income tax, capital gains tax and/or inheritance tax liability concerning offshore matters or transfers. The RTC legislation relates to offshore tax non-compliance committed before 6 April 2017.

The final date (30 September 2018) for correcting historic...

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Tax Diary March/April 2018 General

1 March 2018 - Due date for corporation tax due for the year ended 31 May 2017.

2 March 2018 – Self assessment tax for 2016/17 paid after this date will incur a 5% surcharge.

19 March 2018 - PAYE and NIC deductions due for month ended 5 March 2018. (If you pay your tax electronically the due date is 22 March 2018)

19 March 2018 - Filing deadline for the CIS300 monthly return for the month ended 5 March 2018.

19 March 2018 - CIS tax deducted for the month ended 5 March 2018 is payable by today.

1 April 2018 - Due date for corporation tax due for the year ended 30 June 2017.

19 April 2018 - PAYE and...

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Best wishes,

The Exceed Team
Exceed CA Limited     Bank House, 81 St Judes Road, Englefield Green, Surrey, TW20 0DF, United Kingdom
Tel (UK): +44 (0) 1784 439 955  |  Tel (World): 0370 060 0996  |   |  www.exceedca.com

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