60 Easy Tax Wins
Simple yet powerful ways to pay less tax
A Tips & Advice book about...
In a nutshell
To take advantage of tax breaks you first need to know they exist. 60 Easy Tax Wins brings together a raft of tried and tested tax-saving ideas for everyone. Whether you’re an employee on a fixed salary, run your own business or are a landlord, this book has something for you. In plain English it explains who each tax break is for and how to use it.
It shows you 60 different ways in which you can cut your tax bill. There are tips to help you put the ideas into practice, plus the possible traps are highlighted. The ideas are backed up with real-life examples, draft tax claims, elections and other documents.
Topics covered include:
- Personal tax
- Business tax
- PAYE and NI for employers
- Property rental income
- Capital gains tax
- Inheritance tax
See how to use these 60 tax breaks to pay less tax!
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Individuals and business owners that want to:
- take advantage of legitimate tax-saving strategies.
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In this Tips & Advice book you'll read about...
Chapter 1 - Personal tax
1. The marriage allowance
1.1. What is it?
1.2. What are the conditions?
1.3. Are there any traps to look for?
1.4. How do you turn this into a tax win?
2. Homeworking expenses
2.1. What sort of expenses are tax deductible?
2.2. When can a claim for homeworking costs be claimed?
2.3. What expenses count as additional costs?
2.4. Is there an easy way to work out the tax deduction?
3. Extra tax relief for mileage allowances
3.1. What are HMRC’s approved mileage allowances?
3.2. What are AMRs worth?
3.3. What’s qualifying mileage?
3.4. What counts as a qualifying business journey?
4. Tax relief for work clothing
4.1. When can deductions for the cost of workplace clothing be claimed?
4.2. When is a tax deduction not allowed for the cost of a uniform?
4.3. When is the cost of protective clothing tax deductible?
4.4. Can a tax deduction be claimed for cleaning workplace clothing?
5. Tax deductions for work-related subscriptions
5.1. When can a tax deduction for membership fees or subscriptions be claimed?
5.2. What are the conditions for claiming a deduction for professional membership costs?
5.3. What are the conditions for claiming a deduction for annual subscriptions?
6. How to get tax-free savings income
6.1. Why focus on savings income?
6.2. How can you take advantage?
6.3. What about company owners
7. Sharing unearned income with your spouse or civil partner
7.1. What kind of income can you split?
7.2. What are the default rules for joint income?
7.3. When will the 50:50 rule be disadvantageous, and can you override it?
7.4. What are the exceptions?
7.5. Are there any other traps?
8. Reducing your high income child benefit charge
8.1. Who pays the HICBC?
8.2. Opt out?
8.3. Reducing the charge
9. Tax relief for loan interest
9.1. How do you secure relief?
9.2. What qualifies for relief?
9.3. What traps do you need to look for?
9.4. How do you claim?
10. Employee pension contributions - claim for higher rate relief
10.1. What relief can you claim?
10.2. How does relief work?
10.3. Can you claim early?
11. Self-employed pension contributions - claim for higher rate relief
11.1. How do pension contributions work for the self-employed?
11.2. Can relief be claimed in-year?
11.3. How do you claim?
12. Making tax-efficient pension contributions
12.1. What’s the pensions annual allowance?
12.2. How is the AA reduced if you have a high income?
12.3. How does accessing pension savings affect the AA?
12.4. Can you avoid triggering the MPAA?
13. Reducing self-assessment payments on account
13.1. What are payments on account?
13.2. What kind of things reduce the liability?
14. Getting the most from gift aid relief
14.1. How does gift aid work for individuals?
14.2. When can extra tax relief be claimed?
14.3. How can you maximise gift aid tax relief?
14.4. When can gift aid payments result in an extra tax bill?
14.5. When can carry back of gift aid relief be claimed?
15. The tax-free trading allowance
15.1. What’s the trading allowance and what can it apply to?
15.2. What income can’t the TA apply to?
15.3. How is income calculated for TA purposes?
15.4. How is the TA deducted from your income?
15.5. What are the other rules for the TA?
16. How to successfully claim overpayment relief
16.1. What are the normal rules for correcting errors?
16.2. What if you miss the deadline?
16.3. How do you make a claim?
16.4. Why would HMRC reject a claim?
17. Investing in tax incentive schemes
17.1. What are the tax incentive schemes?
17.2. What are the tax breaks?
17.3. What are the qualifying conditions?
18. Capital allowances for employees and directors
18.1. What counts as qualifying capital expenditure?
18.2. What if your employer contributes?
18.3. Are there any other restrictions?
19. Check and reclaim overpaid NI
19.1. Why aren’t NI payments reconciled on a tax return?
19.2. What if you pay more than one class?
19.3. Can this be avoided?
19.4. How do you make a claim?
Chapter 2 - Employment
1. Paying employees’ homeworking expenses
1.1. How does the homeworking exemption work?
1.2. How much can you pay tax and NI free?
1.3. Does it save any tax or NI?
1.4. Can you pay an employee’s other homeworking costs tax and NI free?
2. Subsistence and travel-related allowances
2.1. What are benchmark subsistence payments?
2.2. What are overseas travel and subsistence payments?
2.3. What are working rule agreements?
2.4. What are incidental overnight expenses?
3. Trivial benefits in kind
3.1. What are the basic terms and conditions of the exemption?
3.2. How can directors use the exemption?
4. Mobile phones - a flexible tax and NI-free perk
4.1. When does the exemption apply?
4.2. Does the exemption cover SIM only contracts?
4.3. Are there exclusions from the exemption?
4.4. Can the exemption apply to more than one mobile phone?
4.5. Does the exemption apply to reimbursement of the cost of a mobile phone or contract charges?
4.6. Are there any tax and NI savings for your business?
5. Minor benefits in kind
5.1. What minor benefits are exempt from tax and NI?
5.2. Are there any conditions?
Chapter 3 - Business tax
1. Turn start-up losses into tax refunds
1.1. Why are start-ups often loss making?
1.2. Relief for early losses
1.3. Is claiming early years’ loss relief the best option?
1.4. Are there any traps?
2. Maximise tax relief for trading losses made by an established business
2.1. What are the rules for your trading losses?
2.2. How can you avoid wasting personal allowances?
2.3. How can you maximise relief?
2.4. How do losses affect your NI payments?
2.5. Are there any traps to look for?
3. Tax deductions for pre-trading expenses
3.1. When are pre-trading expenses tax deductible?
3.2. Do personal expenses qualify for a tax deduction?
3.3. How much tax deduction is allowed?
3.4. How do tax deductions differ for capital pre-trade expenses compared with day-to-day costs?
3.5. What about services used before trading commences?
4. Choosing the right company cars to save tax
4.1. How are company cars taxed?
4.2. Why can choosing electric vehicles save tax?
4.3. What about hybrids?
4.4. What about fuel?
4.5. Are there any other tax breaks?
5. Uncovering hidden capital allowances
5.1. How do you identify qualifying fixtures and fittings?
5.2. What assets count as integral features?
5.3. Are there other conditions for a successful CAs claim?
5.4. How much tax deduction can be claimed?
6. Tax and NI-efficient remuneration packages
6.1. What’s the most tax-efficient mix of income to take from your company?
6.2. How do the LEL and PET affect your income?
6.3. When should you take benefits in kind?
6.4. When should dividends be paid?
6.5. What’s the most tax-efficient amount of dividends to pay?
6.6. What’s the most tax-efficient way to take further income from your company?
7. Dividend waivers and amended share rights for reducing income tax
7.1. What’s a dividend waiver?
7.2. What are the tax and other financial effects of a waiver?
7.3. What are alphabet shares?
7.4. How do you amend share rights?
8. Tax deductions for personal life insurance
8.1. What’s an RLP?
8.2. Can your business claim a tax deduction for RLP premiums?
8.3. Are there any exclusions?
8.4. Does an RLP count as a taxable benefit in kind?
8.5. Are there other tax benefits?
9. Defer and reduce tax on the sale of business assets
9.1. What is rollover relief and how does it work?
9.2. Which gains can rollover relief apply to?
9.3. What’s the tax position if the replacement assets are sold with the business?
10. Transfer trading stock to a company
10.1. Why does transferring a business to a company trigger an extra tax bill?
10.2. Is there a more tax-efficient way to defer and possibly reduce the tax?
10.3. Can the election also apply to work-in-progress transferred?
11. Transferring equipment to a company
11.1. When might you need to transfer equipment?
11.2. How do you get around the problem?
11.3. How do you make the claim?
12. Transfer your unincorporated business to a company tax free
12.1. What’s incorporation?
12.2. How do you claim it?
12.3. How do you make an election?
13. Self-employed - tax deductions for subsistence expenses
13.1. When can you claim a tax deduction for subsistence costs?
13.2. How much can you claim as a deduction?
Chapter 4 - VAT
1. Recovering VAT as an intending trader
1.1. What’s the issue for a new business?
1.2. Are there any conditions?
1.3. What if you abandon the idea?
1.4. Is there a way to improve efficiency still further?
2. Recovering pre-registration VAT
2.1. How does this work?
2.2. What about older costs?
3. The flat rate scheme
3.1. How does the FRS differ from standard VAT accounting?
3.2. Is the FRS right for your business?
3.3. How can you maximise savings as a low cost trader?
3.4. Are there any other saving opportunities?
4. The cash accounting scheme
4.1. What is cash accounting?
4.2. Is your business eligible and how might it benefit?
4.3. Are there any traps to look out for when joining?
4.4. Is everything covered by the scheme?
4.5. Are there rules about leaving the CAS?
4.6. Are there any tips for leaving the scheme?
5. Saving VAT on employee benefits
5.1. What are the VAT issues with employee benefits?
5.2. How can you take advantage?
5.3. What if you want to provide benefits selectively?
5.4. Are there any other VAT saving tips?
Chapter 5 - Property
1. How to share rental income to save tax
1.1. How is rental income allocated to joint owners?
1.2. What’s the special rule for married couples and civil partners?
1.3. How can the allocation of taxable income be varied?
1.4. Will HMRC accept a partnership created to save tax?
2. Maximise tax deductions for letting expenses
2.1. What tax deductions are commonly overlooked?
3. Rent-a-room relief
3.1. What is rent-a-room relief?
3.2. What are the conditions for the relief?
3.3. How is the maximum relief calculated?
3.4. When does the relief not apply?
3.5. How does rent-a-room relief apply where rental income is less than the maximum relief?
3.6. How does the relief apply where rental income exceeds the maximum relief?
4. The property allowance
4.1. What income can the PA apply to?
4.2. How does the allowance interact with rent-a-room relief?
4.3. How is income calculated for PA purposes?
4.4. How is the PA given?
4.5. When and why would you disclaim the PA?
Chapter 6 - Capital gains tax (CGT)
1. Share income tax loss relief
1.1. What is the relief?
1.2. Which shares qualify?
1.3. Are there any traps to look out for?
1.4. How do you claim?
1.5. Are there any other planning points?
2. Claim to pay CGT in instalments
2.1. What’s the issue?
2.2. Does your gain qualify?
2.3. How are instalments calculated?
3. Gift to spouse prior to disposal
3.1. What’s the opportunity to save tax?
3.2. How can you save CGT?
3.3. Won’t HMRC say this is just tax avoidance?
3.4. Are there any further planning points?
4. Claim for capital improvements
4.1. What’s the difference between repairs and capital costs?
4.2. How can you save tax?
5. Private residence relief: nominating a main home
5.1. What’s the tax position if you buy a second home?
5.2. Can you nominate any property you own?
5.3. What if you’ve missed the election window?
5.4. What if one property grows in value quickly?
6. Private residence relief: claiming permitted absences
6.1. How does the PRR apportionment work?
6.2. How could additional relief be claimed?
6.3. How can you be proactive to save tax?
6.4. Are there any traps?
7. Negligible value claim
7.1. What’s a negligible value claim?
7.2. How do you know if the shares are worthless?
7.3. Is there a way to increase the savings?
8. Reducing the CGT rate on property gains
8.1. What’s the issue with property?
8.2. How can this save tax?
8.3. What’s the EIS?
8.4. Does HMRC accept this planning?
9. Holdover relief on gifts
9.1. What’s holdover relief?
9.2. What does holdover relief do?
9.3. Is the relief of use if you don’t have any business assets?
10. Investors’ relief
10.1. What’s investors’ relief?
10.2. How do shares qualify?
10.3. Are there any conditions?
10.4. How can you spot potential shares qualifying for IR in your portfolio?
Chapter 7 - Inheritance tax (IHT)
1. IHT planning with gifts
1.1. What are the lifetime gift exemptions?
1.2. How should you record gifts?
2. IHT-free gifts of business property
2.1. When does BPR apply?
2.2. What do the different rates of BPR apply to?
3. Varying a will to save tax
3.1. What is a deed of variation?
3.2. What conditions must be met to make a deed valid?
3.3. What are the tax advantages of a deed?
3.4. Are there potential drawbacks with a deed?
4. Electing for UK domicile status
4.1. How does the election work?
4.2. What are the IHT consequences of making an election?
4.3. Is it worth making an election?
Chapter 8 - Appendices
1. Appendix A - tax-free benefits
2. Appendix B - list of flat rate scheme relevant percentages
3. Appendix C - domicile
3.1. Domicile of origin
3.2. Domicile of dependency
3.3. Domicile of choice
3.4. Deemed domicile
3.5. Foreign domicile
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