Making Tax Digital

Making Tax Digital

by | 3 Feb, 2017 | Making Tax Digital, Tax

making tax digital

Here you can find all our content and resources around Making Tax Digital

guides

Are your ready for Making Tax Digital? - Lewis Brownlee Chartered Accountants Chichester

Are your ready for MTD?

Do you keep spreadsheets for your accounting records? Not only could this be costing you time, and money, it may not be compliant with Making Tax Digital. Find out more in our guide.

Making Tax Digital Guide

Our complete guide on everything you need to know about Making Tax Digital including: What it is; Software; HMRC Registration and Xero.

Making Tax Digital - Digital Links

Digital Links

For periods starting on or after 1 April 2021 businesses trading at or above the VAT registration threshold will now also be required to have ‘digital links’ in all their record keeping.

MTD for Self-Assessment - Chichester Accountants

Making Tax Digital for Self-Assessment

MTD for Income Tax Self-Assessment (MTD ITSA) will include any unincorporated businesses or property landlords with income in excess of £10,000.00.

Videos

Making Tax Digital for Landlords

Landlords with annual property income above £10,000 will need to follow the rules for MTD for Income Tax from 6 April 2023.

Making Tax Digital for Self-Assessment

Here’s our overview of the upcoming changes to self-assessment, namely Making Tax Digital which will apply from 6 April 2023.

MTD and Digital Links

An overview of the Digital Links aspect of Making Tax Digital, and the benefits of moving to a cloud accounting system.

blogs

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IHT and Reservation of Benefit: Avoiding the Unexpected

IHT and Reservation of Benefit: Avoiding the Unexpected

by | 26 Jan, 2017 | Tax

IHT and Reservation of Benefit: Avoiding the Unexpected

Inheritance Tax (IHT) can create unexpected complications when gifting assets while continuing to benefit from them. The IHT reservation of benefit rule applies when someone gives away an asset but still uses or enjoys it.

Even if legal ownership is transferred, HMRC may treat the asset as part of the donor’s estate, making it subject to 40% inheritance tax upon death.

Avoiding the IHT Reservation of Benefit Trap

If you plan to gift an asset but still want to use it, consider these approaches:

  • Paying market rent – If you gift a property but continue living in it, paying full market rent can remove it from your estate.
  • Sharing running costs – If the asset is jointly used, covering an appropriate share of maintenance and expenses may reduce tax risk.
  • Transferring full control – To remove any IHT reservation of benefit, you must relinquish all rights to the asset, including financial and usage benefits.

By following these strategies, you can ensure that gifted assets genuinely leave your estate for inheritance tax purposes.

Capital Gains Tax Considerations

While managing IHT reservation of benefit, you must also be mindful of capital gains tax (CGT).

  • If an asset increases in value after being gifted, the recipient may face CGT when selling it.
  • Property gifts, unless to a spouse or civil partner, may trigger immediate CGT liability for the donor.
  • Strategic planning ensures that both IHT and CGT implications are addressed effectively.

Proper tax planning prevents unintended costs and maximises financial efficiency.

How We Can Help

Navigating IHT reservation of benefit rules requires careful planning. At Lewis Brownlee, we provide expert advice to minimise inheritance tax and capital gains tax liabilities.

For professional guidance, contact us today. Our team is here to help.

Negligible value claims

Negligible value claims

by | 23 Jan, 2017 | Tax

Negligible value claims

A special rule enables you to claim a capital gains tax loss where the value of the shares become negligible and you do not have to actually sell them.

If you bought the shares directly from the company and it is a trading company you can convert a capital loss into a trading loss thus saving income tax at a rate of up to 45%, rather than perhaps 28%.

But if when you subscribe the shares have already become of negligible value, then you cannot make a claim until you make an actual loss either when you sell them or the company is wound up.

Property – trading or capital gain

Property – trading or capital gain

by | 19 Jan, 2017 | Property, Tax

Property – trading or capital gain

HMRC have introduced a new tax rule to take effect for property disposals made on and after 5 July 2016 by overseas investors to cause them to pay UK tax. But this might catch some UK landlords as it is widely drawn. Profits from UK property sales made on or after 5 July 2016 will be taxed as part of a trade of dealing or developing land, where any of the following conditions apply:-

  • The main purpose or one of the main purposes in acquiring the land was to realise a profit or gain from its disposal
  • The main purpose or one of the main purposes in acquiring the property was to realise a profit or gain from the disposal of the land
  • The land is held as trading stock
  • The main purpose or one of the main purposes of developing the land (where this is done) was to realise a profit or gain from disposing of the land when developed

We can see that this could rise to a lot of disputes with HMRC, for example where a landlord acquires a property to let but have an eye on gains that could be made.

The new law does not apply to homes which are exempt from CGT as the main residence exemption applies.

Research & Development (R & D) advance assurance scheme

Research & Development (R & D) advance assurance scheme

by | 13 Jan, 2017 | Business, Tax

Research & Development (R & D) advance assurance scheme

This enables successful applicants with an assurance that their claims for R & D tax relief will not be subject to an HMRC enquiry and that HMRC will accept their first three years of claims.

To be eligible:-

  • The business must be a company
  • Turnover must be less than £2 million
  • There must be fewer than 50 employees
  • The company must not have claimed R & D relief in the past

We can help you with this but we will have to log in using a client’s gateway, not our own.

Corporation tax – reducing paperwork further

Corporation tax – reducing paperwork further

by | 12 Jan, 2017 | Business, Tax

Corporation tax – reducing paperwork further

Acknowledgements to corporation tax returns filed will no longer be issued in paper form either to the company’s registered office or the agent acting. The acceptance of the return will be confirmed by an emailed notice issued by HMRC’s software.

Where HMRC are legally required to serve some notices, if the company’s registered office is the same as our office, only one copy of the notice, issued to the company at the registered office will be sent.

This includes an amendment to a corporation tax return (form 620 AMD) and notice of penalty determination ( form CT211)