Some more Tax breaks

30 11 2009
  1. If your sales, excluding VAT, are less than £150,000 per annum, have you considered switching to the flat rate VAT accounting scheme? Tip: Not only could this system be simpler to administer, but it could also result in you paying less VAT. It could also cost you more, so professional advice is essential.

2.Do you always time the payment of dividends and bonuses so that they fall in the ‘right’ tax year for you? Tip: The timing of dividends and bonuses can have a big effect on how much tax you pay on them – and when it must be paid.

3.Do you fully understand how to calculate the tax value of benefits in kind? Tip: As an employer, it is your responsibility to calculate these tax values and include them on your employees’ P11D’s. Be careful, though – you can face a fine of £3,000 each P11D you fill out incorrectly.

4.Have you looked into whether it is possible to cut costs and improve cash flow by paying your PAYE and NIC quarterly instead of monthly? Tip: This is possible if your average monthly PAYE and NIC payments are less than £1,500.

5.Are you aware that each of your children can earn up to £6,435 a year as income, and £10,100 a year in capital gains – completely tax & NI free? Tip: Grandparents can be the key here, since it is not as simple as a parent putting money into their children’s names. Once again, you will need professional advice.

6.If your spouse pays a lower tax rate than you, have you considered passing some of your investments to them in order to reduce your combined tax bills?


If you answered no to any question, or you would like more information or advice about tax breaks, please visit our websiteTax Accountant or email us at   Make sure you’re aware of the new National Minimum Wage Rates for 2011 – they come into effect in October 2011.




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