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September 2022

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To September’s Business Companion News.

Paying Your Corporation Tax?

Strictly Corporation Tax is due nine months after the accounting year-end. However HMRC will not impose a penalty as long as it is paid within 12 months, but will just add a little interest.  Oddly the CT return is only due 12 months after the year-end. 

HMRC Payment Details:
– Account number: 12001039
– Sort Code: 08-32-10
– Account Name: HMRC Cumbernauld
– Payment reference: see payslip at the bottom of the payment letter from HMRC or just email us and we can find it for you.

Note: you must use the correct reference otherwise HMRC may allocate the payment to the wrong year. 

September 2022
· Don’t ignore letters from HMRC
· One way of getting money out of your company – charge rent
· Have you taken an ‘illegal dividend’?
· Are you trading?
· September Questions and Answers
· September Key tax dates
Don’t Ignore letters from HMRC top

As agents we don't get copies of all the letters HMRC sends to our clients. In particular, HMRC rarely copy any letters to us relating to VAT.
Recently HMRC have written to several of our clients explaining that they have been removed from certain VAT schemes (Annual Accounting or the Flat Rate Sheme). In most cases there hasn't been any real justification for the removal, but there is limited time to appeal the decisions. These letters have been sent to our clients, not to us.  There has then been a delay before the clients have copied the letter to us – or in some cases the first we know is when we start preparing a VAT return only to find that HMRC have changed the return dates.
So please open anything you receive from HMRC promptly, then scan and send us a copy.

One way of getting money out of your company – charge rent top
Have you taken an ‘illegal dividend’? top

Although dividends are generally the most tax-efficient method by which money can be extracted from a company, renting a property you own to your company can be more or as tax efficient depending on your marginal tax rate. Whether charging rent is tax-efficient needs to be looked at overall by not only taking into account the director's immediate income tax position and the company's tax situation, but also the future capital gains tax (CGT) position when the property or the company itself is eventually sold.
Read More

Anyone who invests in a company is taking a chance, hoping that the money will not be wasted, and that the directors, as representatives of the company, will use the money in such a way that the company's profit increases. In return for taking this chance, a shareholder receives 'payback' usually in the form of a share in the distribution of profits via a dividend. The payment is not an absolute right and unfortunately some directors/shareholders of family owned companies believe that as long as there is cash in the bank then they can take the balance as a dividend.
Read More

Are you trading? top

Covid -19 had a devastating impact on many businesses with significant numbers closing for good. However, many workers who were made redundant or furloughed took the opportunity to set up their own businesses. According to the Government's December 2021 report 'Business Statistics' an estimated 810,316 new businesses were launched in the financial year ending in 2021 — the highest number on record. The report also noted that there had been a distinct fall in the number of employees and said that it was believed that the decline was 'due to the growth in self-employment'.
Read More

September Questions and Answers top
September Key tax dates top

Q1.I am a self employed dentist wanting to expand my knowledge and specialise in a particular branch of dentistry. I have discovered that there is a part time course at my local university which will enable me to continue working. The cost is £25,000 and it will take three years to get the qualification. Can I claim the cost of the course against my self employed earnings? Answer

Q. My husband and I are joint partners in a business for profit sharing purposes. The work requires me to do a lot of travelling on business and my husband accompanies me occasionally. As my husband is not involved in the business purpose of these trips (e.g. meetings) can any travel expenses be claimed? Answer

Q. We have had a rental property for some years and now that we are retired, we wish to live there and rent out our (original) main residence. How long must we live in a property before it becomes our main residence? Answer

1 – Corporation Tax payment 30 November 2021 year end

New rates published for Advisory fuel rates for company car drivers

Trust Registration Service: deadline to register non-taxable trusts in existence on 6 October 2020, some non-taxable trusts created after 6 October 2020, and some taxable trusts created on or after 6 April 2021.

7 – Electronic VAT return and payment due for VAT quarter ended 31 July 2022.

19 – CIS return for payments made to subcontractors in the month to 5 September 2022

22 – PAYE, NIC and CIS payment (electronic): month-end 5 September 2022

30 – Corporation Tax returns submission: 30 September 2021 year ends

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, Acclivity, Mamut, Xero, FreeAgent, Quickbooks or Clearbooks.

‘All clients using these software packages can benefit from our support. Visit our website for a look at the resource on offer.’

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