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    Personal Taxes

    At Crowther Chartered Accountants, we work with both businesses and individuals to come up with a personal tax strategy to suit you. Everybody’s individual circumstances are different, but our helpful accounts team will work with you to determine what tax scenario is best for you.

    From self-employed tradespeople to directors of multi-national companies, everybody must pay income tax. The current Personal Allowance threshold stands at £11,500 tax-free income over the year, but this changes according to the current budget. You can check current personal allowance and rates of income tax on HMRC’s website.

    Understanding the taxation system in the UK is quite a task, so knowing whether you’re paying the right amount of tax can sometimes be a little tricky. Our expert team of accounting staff will discuss your requirements and ensure that you’re making the best of your situation.

    Income tax is one of the areas that our team at Crowther specialise in, and we’re always happy to offer help and advice to our clients. Our Payroll Manager, Gemma Giles, specialises in Self-Assessment Tax Returns and can speak to HMRC on your behalf if necessary, taking the hassle out of completing your tax return.

    Self-employed Individuals

    If you’re a sole trader or self-employed, you must complete a Self-Assessment Tax Return each year and pay the tax across to HMRC. Our payroll team can help you out with completing the return, provided you keep accurate records of income and expenditure throughout the year.

    Your Self-Assessment must be completed by 31st January each year (for the tax year the ended the previous April). You’ll need to keep records of your. income, such as invoices and bank statements. You should also keep track of your expenses, including receipts. Many of your purchases can be deducted from your tax return, such as:

    • Materials purchased for work (e.g. building materials if you’re a builder)
    • Office supplies
    • Gas and electricity bills (if you work from home you’re entitled to an allowance)
    • Rent
    • Professional fees (e.g. accountancy fees or legal expenses)

    These expenses can be deducted from your taxable profit and you’ll only pay income tax on the remainder. As part of your. Self-Assessment Tax Return, your National Insurance Contribution is also accounted for.

    Company Directors

    If you’re a director of a limited company, you must also complete a Self-Assessment Tax Return each year before the 31st January (for the tax year that ended the previous April). You pay income tax on the salary that you have drawn from the company during the tax period.

    Business expenses should be recognised in the company accounts, such as materials purchased for work and office supplies. Any expenses that you have paid personally e.g. using a personal credit card instead of a company one, will be owed to you by the company. This is represented in the Directors Loan Account, and is explained when we complete your year-end accounts.

    As with sole traders, your National Insurance Contribution is taken care of in your Self-Assessment Tax Return. However, if you employ other people, you’ll have to make an Employer’s National Insurance Contribution too.

    Employing Staff

    As we partner with our clients on their business journeys, we’re always delighted to see them grow. As you take on staff, many aspects of your business are likely to change. We can help you with the financial aspects of this change, such as setting up payroll and PAYE, through to ensuring you have the correct workplace pensions in place.

    Taxing Employees

    Employees are taxed via the Pay-As-You-Earn system, so Income Tax and National Insurance Contributions are taken directly from their wages. You need to keep accurate records of your payroll and this will need to be submitted to HMRC.

    Our team will get you set up on our payroll systems, taking care of your weekly or monthly payroll.    We’ll advise you on sick pay, annual leave allowances and more complex scenarios such as maternity pay or salary sacrifice schemes. Our experienced team on payroll have a wealth of knowledge and experience dealing with payroll, from working with companies of a range of different sizes.

    Workplace Pensions

    Employers now have to provide a workplace pension for all eligible staff (those aged between 21 and 75, and earning more than the minimum threshold). You will need to set up an auto-enrolment scheme and write to each of your employees detailing the contributions that the company will make towards their pensions. The current minimum is 1% contribution from the employee and 1% from the employer, but this is due to rise in April 2018 to 3% and 2% respectively.

    To find out more about how we can help with your personal tax queries, payroll and PAYE, speak to one of our qualified accountants. Our team are always happy to help, and you can get in touch on 01484515544 or email together@crowther.accountants


    Our most common Tax questions


    Corporation Tax

    Corporation tax can be a difficult concept to understand for business owners. At Crowther Chartered Accountants, our experienced team of chartered accountants have a wealth of experience surrounding corporation tax and are always up-to-date the the current schemes and exemptions available to our clients.

    All companies who are registered in the UK must pay corporation tax, along with any foreign companies who operate from a UK branch or office. However, corporation tax only applies to limited companies, so if you’re a sole trader or partnership, you don’t need to worry about it.

    Corporation tax is paid on the profit your company makes over the year, and unlike income tax, there is no minimum threshold. All companies pay the same rate (except for certain industries such as oil and gas) which currently stands at 19%.

    The standard rate of corporation tax (19%) is applied to:

    • Profit from doing business (e.g. sales)
    • Income generated from company investments (e.g. property)
    • Money associated with selling assets for more than you originally paid for them (e.g. equipment or machinery).

    To calculate your taxable profits, we can deduct certain types of expenditure. Purchases relating to sales, such as raw materials, business running costs and staff wages are not included in your corporation tax return. This can mean that your profit and loss for your corporation tax is slightly different from the profit and loss in your year-end accounts.

    The filing deadline is 12 months after the end of your financial year, but with corporation tax, you can file with HMRC after the balance has been paid. At the end of your accounting period, you have 9 months to submit your year-end accounts to Companies House. We usually recommend that small businesses file their corporation tax at the same time as submitting their accounts, as the corporation tax must be paid within the same timeframe.

    There are various schemes that you may be eligible for which could reduce the amount of corporation tax that you pay, such as:

    • Annual Investment Allowance
    • Research and Development Tax Relief
    • Enhanced Capital Allowances

    Our team of accountants are experienced in the complexities of corporation tax, and know the ins-and-outs of each of the different schemes. We will ensure that you’re paying the correct amount of corporation tax, applying any appropriate deductions and allowances.

    To find out more about how we can help with your corporation tax and your year-end accounts, get in touch with our accountancy team on 01484515544 or email together@crowther.accountants – we’re always happy to help!

    VAT

    At Crowther Chartered Accountants we have a dedicated team who specialise in VAT. We work with a variety of small businesses so our team have experience of the different VAT rates and schemes available.

    When you register for VAT with HMRC, you must charge VAT on your sales, but (depending on the scheme that you’re on) you can reclaim VAT on your purchases to offset your VAT bill. Both businesses and consumers must pay VAT on their purchases, but your business customers will be able to reclaim the VAT you charge if they’re VAT registered.

    If you’re on the standard VAT scheme, you must charge VAT at 20% on top of your sales and you can deduct any VAT that you’ve paid on purchases:

    Amount to pay to HMRC = Output Tax – Input Tax

    Once your turnover reaches £85,000 annually, you must register for VAT. However you can also register earlier than that.

    Why register for VAT before you meet the threshold?

    Some organisations register for VAT before they reach the £85,000 turnover threshold for different reasons:

    1. Reclaiming VAT on purchases. If your input tax is higher than your output tax, i.e. if the tax you’ve paid on purchases is higher than the VAT you’ve charged on sales, you could be entitled to a refund from HMRC.
    2. Public perception. Some companies choose to register for VAT before they reach the £85,000 threshold to help them to appear larger than they are. This might help to improve the impression you give to potential clients and give them more confidence in the products or services you’re offering.

    Choosing the right VAT Scheme

    There are different VAT schemes available, making VAT slightly more complicated than it might appear at first glance. Our team of experts can advise you on the scheme that’s right for you, depending on your average sales, turnover and industry.

    Because we work with a variety of businesses of different sizes and industries, our VAT team is experienced working with different schemes, such as:

    • Standard Accounting
    • Cash Accounting
    • Flat Rate Scheme
    • Annual Accounting Scheme

    VAT is usually paid quarterly and you can file and pay your VAT return online via HMRC’s online portal. Alternatively our bookkeeping and VAT team can deal with this by calculating and filing your VAT return on your behalf.

    If you’d like to find out more about how we can help with your VAT return, or you’d like advice on which scheme is right for you, get in touch with our team on 01484515544 or email together@crowther.accountants – we’re always happy to help!


    Our most common VAT questions


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