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Welcome… To November’s Tax Tips & News, our newsletter designed to bring you tax tips and news to keep you one step ahead of the taxman. If you need further assistance just let us know or you can send us a question for our Question and Answer Section. We are committed to ensuring all our clients don’t pay a penny more in tax than is necessary. Please contact us for advice in your own specific circumstances. We’re here to help! November 2012 · Reducing the Child Benefit Tax Charge · Avoid Property Trading Tax · VAT on Exports · NIC Refunds for Vocational Training · November Question and Answer Section · November Key Tax Dates Reducing the Child Benefit Tax Charge top You may have received a letter from the Taxman about the high income child benefit charge (HICBC), which is designed to claw-back child benefit from high earners. We explained the principles of this charge in our September 2012 newsletter. If you or your spouse/partner claim child benefit, and either one of you have income of over £50,000 per year, your family will be subject to the HICBC to claw-back part or all of the child benefit paid from 7 January 2013. The charge must be paid by the higher earner in the family irrespective of who actually receives the child benefit. Read More   Avoid Property Trading Tax top VAT on Exports top Some people regularly purchase run-down houses, do them up and sell them on. If you do this as part of your building/property development business, the profits made on the sale of the properties may be taxed as trading income (tax rates: 20%, 40% or 50%). If you let the renovated properties, then sell them at a later date, the profits made on those sales will be taxed as capital gains (tax rates: 18% or 28%). The position is less clear cut if you live in each property for a period either during or after the renovations are undertaken. The Taxman is keen to charge any profits made on the renovated property as trading income, because if the profits are categorised as a capital gain, that gain may well be exempt from tax on the basis that the property was your main residence. Read More The internet has enabled many small businesses to sell internationally, but exporting goods and services can create VAT difficulties. For VAT purposes you need to know whether you are selling goods (physical things), or services (something you cannot physically touch eg: downloaded software), as the rules vary for goods as opposed to services. You also need to know where your customer is based – in an EU country or elsewhere and whether the customer is a VAT registered business. When you sell goods to other businesses in the EU or in other countries you can normally charge the zero-rate of VAT on the sale. This means you can recover VAT on any related input costs. However, you need to show that your customer was VAT registered and the goods physically left the UK. Getting the paperwork right is essential. Read More   NIC Refunds for Vocational Training top November Question and Answer Section top Does your business engage self-employed teachers, lecturers or vocational instructors, or are you such a self-employed teacher or instructor? The NI contribution regulations were changed from 6 April 2012 to make it clear that such teachers/instructors should not be treated as employed and subject to class 1 NICs, where they were engaged on self-employed contracts. However, for years prior to 6 April 2012 the Taxman demanded payment of Class 1 NICs from organisations who engaged self-employed vocational instructors whose self-employed status was not in dispute. Now the Taxman has admitted the NIC regulations in place before April 2012 did not apply to those who provided vocational or recreational training (as opposed to more formal education). Read More Q. My business needs to move to smaller cheaper premises, but my current landlord wants me to pay a fee to surrender the property lease earlier than the next break point. Can I claim that lease-surrender payment as a business expense? Answer Q. I sold a property in August 2012 which made a gain of £50,000. It consisted of a cafe on the ground floor which I ran as a sole trader until August 2010, and a residential flat above, both of which were let out from August 2010 until the date of sale. Can I claim entrepreneurs’ relief on the gain? Answer Q. The Taxman is always demanding money from me for VAT, PAYE, corporation tax, Class 1A NICs, excise duty, the list goes on and on. I am terrified of mixing up the payments and paying the wrong amount to the wrong part of the great tax department. How can I make sure I get it right? Answer   November Key Tax Dates top 2 – Last day for car change notifications in the quarter to 5 October – Use P46 Car 19/22 – PAYE/NIC and CIS deductions due for month to 5/11/2012   Need Help? top New Clients Welcome top Please contact us if we can help you with these or any other tax or accounts matters. In addition, if there’s anyone else who you think would benefit from the newsletter, please forward the email to them or ask them to contact us to be added to the newsletter list. If you are not already a client and are interested in becoming one, we would love to discuss how we can help and provide you with a competitive quote for our services. See details of our Business Companion Service.   About Us top Simple Accounting Limited offers a cost effective Business Companion service to business owners who use MYOB, Mamut, Solar Accounts, Quickbooks or Clearbooks. We offer a range of accountancy services despite being specialists. ‘All clients using these software packages can benefit from our support. Visit our website http://www.simpleaccounting.co.uk for a look at the resource on offer.’   If the images do not show. If the images contained within this email do not show correctly please add this email to your safe senders list.

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