Blog

Have you claimed your Child Trust Fund cash?

Young persons who turned 18 on or after 1 September 2020 may have cash waiting in a dormant Child Trust Fund (CTF) account. This could be as much as or more than £1,000. The actual amount on deposit depends on certain factors. Children born after 31 August 2002 and before 3 January 2011 were entitled to a CTF account provided they met the necessary conditions. These funds were invested in long-term saving accounts for newly born children. HMRC has confirmed that there are many thousands of teenagers that have turned 18 and not yet claimed the...

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Letting agencies and the Money Laundering Regulations

HMRC is responsible for the money laundering supervision of certain businesses including letting agencies. Businesses that HMRC is responsible for supervising should be aware of the requirement to register with HMRC and the penalties for failing to register. It is a criminal offence to trade as a letting agency business (as defined within the Regulations) without being registered for money laundering supervision. You may need to register with HMRC if your business operates as a letting agency business. A letting agency business means a firm...

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Don’t miss out on this tax allowance

If you are entitled to the marriage allowance and have not yet applied, then you could receive a payment of up to £1,220 from HMRC. The marriage allowance is available to qualifying married couples and those in a civil partnership where a spouse or civil partner is a non-taxpayer i.e., has an income below their personal allowance (currently £12,570). The allowance works by permitting the lower earning partner to transfer up to £1,260 of their personal tax-free allowance to their spouse or civil partner. The marriage allowance can only be used...

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What goods are eligible for the margin scheme?

There are a few VAT margin schemes. The margin schemes work by allowing qualifying businesses to account for VAT on their profit margin i.e., on the difference between the cost of acquiring an item and its sale price rather than on the full selling price. Without the margin scheme the business would have to account for VAT on the full selling price of each item. If an item is sold for less than was paid for it, then no VAT is due on the sale. The eligible goods are: Second-hand goods - defined as tangible movable property that is suitable...

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Valuing property for ATED

The Annual Tax on Enveloped Dwellings (ATED) is a tax payable by certain Non-Natural Persons (NNPs) that own interests in dwellings valued at more than £500,000. These provisions affect certain companies, partnerships with company members and managers of collective investment schemes described in the legislation as NNPs. To value a property, you can use a professional valuer or determine your own valuation. The valuation of the property must be in pounds sterling. Valuations must be on an open-market willing buyer, willing seller basis and be...

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Getting prepared to use Freeport customs sites

In the Spring Budget earlier this year, the chancellor announced that eight Freeport locations would be created in England. The Freeports will be in the East Midlands Airport, Felixstowe and Harwich, the Humber region, Liverpool City Region, Plymouth, the Solent, the Thames, and Teesside. Freeports are a special kind of port where normal tax and customs rules do not apply rather there are simplified customs procedures and duty suspensions on goods. This will allow firms to import components and other pre-manufactured goods into a Freeport...

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£500m support for vulnerable households

The government has launched a new £500 million package of support for vulnerable households. The new Household Support Fund will be used to help those most in need with essentials over the coming months as the country continues its recovery from the pandemic. The fund will be used to help support millions of households in England and monies will be distributed by councils. This means that local councils will also be able to use the funding to provide discretionary support to vulnerable households. This could include using small grants to meet...

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Hospitality trades temporary reduction in VAT has expired

The temporary reduced rate of 5% for hospitality, holiday accommodation and attractions that came into effect in July 2020 ended on 30 September 2021. However, the government had previously decided that reverting to the standard rate would be too much for many businesses and had announced a further step before reverting the rate back to the standard rate. This means that we now have a new reduced rate of 12.5% from 1 October 2021 that will be in effect until 31 March 2022 at which point it is expected that the rate will go back to the 20%...

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Raising capital using the EIS

The Enterprise Investment Scheme (EIS) has been designed to increase investment in the early development of high potential growth businesses. Companies seeking EIS investment are typically more developed than those looking for funding using the Seed Enterprise Investment Scheme (SEIS) and the investment limits and tax reliefs available reflect this. The maximum amount of funds that a company can raise through investments qualifying for the EIS is £5M in any 12 months with a maximum of £12m over the company’s lifetime. The company must receive...

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Reporting grants received to HMRC

Most COVID support grants are treated as taxable income in the same way as other taxable receipts and need to be reported to HMRC. The grants are treated as income where the business is within the scope of either Income Tax or Corporation Tax. This treatment extends to support measures including the following: the Self Employment Income Support Scheme (SEISS) test and trace or self-isolation payments the Coronavirus Job Retention Scheme (CJRS) Eat Out to Help Out Coronavirus Statutory Sick Pay Rebate Coronavirus Business Support...

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