Our exclusive package of 3 tax-saving Special Reports

1. Introduction to VAT

1.1. How does VAT registration work?

1.2. Why would I register voluntarily?

1.3. When do I need to register?

1.4. What do I need to report and when?

2. Flat rate scheme

2.1. What is the flat rate scheme?

2.2. What is the “relevant percentage”?

2.3. Who can use the scheme?

2.4. Are there any specific exclusions?

2.5. Do I need to estimate my future turnover?

2.6. What if my turnover rises?

2.7. What is an associated business?

2.8. Are there any particular points to look out for?

2.9. What are the rules for limited cost traders?

2.10. Who’s affected?

2.11. Can I reclaim any input VAT at all?

2.12. Two relevant percentages could apply - which should I choose?

2.13. I have two distinct business activities - which rate is the correct one?

2.14. How do I join the scheme?

2.15. Can I leave the scheme once I’m registered?

3. Cash accounting scheme

3.1. What is the cash accounting scheme?

3.2. Is my business eligible?

3.3. Do I need to estimate my turnover again?

3.4. Once I register, is everything covered by the scheme?

3.5. Can I use the FRS too?

3.6. What if my turnover increases?

3.7. Is the CAS right for my business?

3.8. When is payment “received” for the purposes of the scheme?

3.9. Are there any other special record keeping requirements?

3.10. How do I join the scheme?

3.11. What about leaving the scheme?

4. Annual accounting scheme

4.1. What is the annual accounting scheme?

4.2. What are the advantages?

4.3. Who can use the scheme?

4.4. Is it suitable for me?

4.5. Can annual accounting be used in conjunction with other schemes?

4.6. How are the instalments calculated, and when are they due?

4.7. Can I use the scheme if I’m partially exempt?

4.8. How do I join the scheme?

4.9. When can I start using the scheme?

4.10. What about leaving the scheme?

5. Margin schemes

5.1. What is a margin scheme and is it the same as global accounting?

5.2. How does the margin scheme work?

5.3. Who can use the margin scheme?

5.4. What are eligible goods?

5.5. How do I calculate the margin?

5.6. Are there any specific requirements?

5.7. What is global accounting?

5.8. How does the margin scheme work if I’m selling second-hand vehicles?

5.9. Is the margin calculated in the same way?

5.10. Can I use global accounting for second-hand vehicles?

5.11. Can I the use the scheme as a second-hand horse or pony dealer?

5.12. How do I use the forms?

5.13. What about auctions?

5.14. I am an auctioneer - do I follow any special rules?

5.15. How is the margin calculated?

6. Retail schemes

6.1. What are VAT retail schemes?

6.2. Who can use retail schemes?

6.3. Are there financial or other limits on retail schemes?

6.4. How do I join (or leave) a retail scheme?

6.5. What are the different types of scheme?

6.6. Can I use more than one type of retail scheme at the same time?

6.7. How do I change to a different retail scheme?

6.8. How does the point of sale (POS) scheme work?

6.9. How do I work out my DGT?

6.10. What are the apportionment schemes?

6.11. How does APP 1 work?

6.12. What types of sale can’t you use APP 1 for?

6.13. How does APP 2 work?

6.14. How do I work out the APP 2 ratio?

6.15. What are direct calculation schemes?

6.16. How does DCS 1 work?

6.17. How does DCS 2 work?

6.18. What are bespoke retail schemes?

7. Business promotion schemes

7.1. What are business promotion schemes?

7.2. Who can use promotion schemes?

7.3. How does VAT apply to business gifts?

7.4. If I give to different people in the same business, how does the £50 limit apply?

7.5. How do I account for VAT on discount schemes?

7.6. How do I account for VAT on a buy-one-get-one-free (BOGOF) scheme?

7.7. What if a different VAT rate applies to the free or discounted item?

7.8. What is the linked supply concession?

7.9. What if a different business provides the linked item?

7.10. Are there VAT timing issues for discounts?

7.11. What’s the VAT position on money-off coupons?

7.12. What’s the VAT position on cashback schemes?

7.13. What’s the VAT position on face value vouchers?

7.14. What’s the VAT position for loyalty and store cards?

7.15. What the VAT position for lottery schemes?

7.16. What’s the VAT position for “dealer loader schemes”?

7.17. What’s the VAT position for low value trade-in schemes?

8. Capital goods scheme

8.1. What is the capital goods scheme (CGS)?

8.2. What goods are covered by the CGS?

8.3. What sort of changes trigger a CGS adjustment?

8.4. How do I adjust input tax under the CGS?

8.5. What are the adjustment periods?

8.6. When should I make CGS adjustments?

8.7. What happens if I sell an asset covered by the CGS?

8.8. Are there CGS anti-avoidance rules?

8.9. Can shorter CGS periods apply?

9. Agricultural flat rate scheme

9.1. What is the agricultural flat rate scheme (AFRS)?

9.2. Who can use the scheme?

9.3. How do I register for the scheme?

9.4. Can I leave the scheme?

9.5. How does the scheme work?

10. Special methods for barristers’ chambers

10.1. What are the special methods for barristers’ chambers?

10.2. Who can use the special methods?

10.3. How does each special method work?

10.4. Can I change which method I use?

11. Sailaway boat scheme

11.1. What is the sailaway boat scheme and how does it work?

11.2. What counts as a “sailaway boat”?

11.3. When can I use the scheme?

11.4. What must I do before I supply the boat?

11.5. What steps must I take at the time of sale?

11.6. What forms have to be used?

12. Appendices

12.1. Appendix A - VAT invoice checklist

12.2. Appendix B - Flat rate scheme percentages

12.3. Appendix C - Relevant goods

12.4. Appendix D - Legal definitions

12.5. Appendix E - Point of sale scheme

12.6. Appendix F - Apportionment scheme 1

12.7. Appendix G - Apportionment scheme 2

Table of contents

Introduction

1. Pensions - where are we now?

1.1. Pensions reform

1.2. What are the different types of pension plan?

2. Pension schemes

2.1. Different schemes

2.2. Self-invested personal pensions (SIPPs)

2.3. Small self-administered schemes (SSAS)

2.4. Executive pension plans (EPPs)

3. Making pension contributions

3.1. Claiming tax relief on pension contributions by individuals

3.2. Pension input periods (PIPs) and carry-forward

3.3. Contributing to retirement annuity contracts

3.4. Timing of employer pension contributions

4. Tax planning

4.1. In-specie pension contributions

4.2. Salary sacrifice schemes

4.3. Recycling tax-free cash

4.4. Pension income recycling

4.5. Payment options on death

4.6. Retirement annuity contracts (Section 226) and inheritance tax

5. Taking your pension

5.1. What are my options for taking money from my pension funds?

5.2. Small pot pension payments

5.3. Uncrystallised fund pension lump sums

5.4. Flexi-access drawdown

5.5. Pension commencement lump sums (tax-free cash)

5.6. Annuities

6. Appendices

6.1. Appendix A - flow chart

6.2. Appendix B - tax treatment of death benefits

1. Introduction

1.1. What is a director’s loan account?

1.2. Why is HMRC interested?

2. Loan-related tax charges applying to companies

2.1. Why are there special rules for directors’ and shareholders’ loans?

2.2. Who does the tax charge apply to?

2.3. What is HMRC’s view of directors’ loans?

3. Loans from close companies

3.1. What counts as a loan?

3.2. What doesn’t count as a loan?

3.3. How are trading transactions between a participator and their company treated?

3.4. Are there exemptions for small loans?

3.5. What if the close company’s business includes making loans?

3.6. Are indirect loans caught?

3.7. What about loans to partnerships and trusts?

3.8. When do the rules for loans to partnerships apply?

4. Tax charge on loans to participators (s.455 charge)

4.1. When does the charge apply?

4.2. Will HMRC refund s.455 tax?

4.3. How much is the charge?

4.4. When is the tax due?

4.5. What is bed and breakfasting?

4.6. How does the 30-day rule work?

4.7. Can the 30-day rule be avoided?

4.8. What is the “intentions and arrangements” rule?

4.9. How are repayments and withdrawals matched for the purposes of these rules?

4.10. What happens if the loan is repaid after s.455 tax has been paid?

4.11. How is the s.455 tax reclaimed?

4.12. How is the relief given?

5. Reporting to HMRC and accounting for s.455 tax

5.1. Do I need to tell HMRC about the loan?

5.2. Loan repaid before the end of accounting period in which it is made

5.3. Loan repaid after the end of the accounting period but before due date for corporation tax

5.4. Loan outstanding nine months and one day after end of accounting period

5.5. How are details of the loan reported?

6. Benefit in kind charge on outstanding loan

6.1. What is the benefit in kind charge?

6.2. What if the participator is not an employee?

6.3. What about NI?

6.4. Which loans are exempt?

6.5. Are there any other exemptions?

6.6. What details need to be reported?

6.7. How is the tax collected?

6.8. When is the Class 1A NI payable?

7. Repaying or clearing the loan

7.1. How can a director’s loan be repaid?

7.2. What’s the position when introducing funds into the company to clear the loan?

7.3. What’s the tax position on declaring a dividend to clear a director’s loan?

7.4. What’s the tax position on dividends for basic rate taxpayers?

7.5. How does the dividend allowance apply for higher and additional rate taxpayers?

7.6. What’s the position of clearing a director’s loan using salary?

7.7. What’s the tax position of paying a bonus to repay a director’s loan?

7.8. What’s the tax position when a director’s loan is written off?

7.9. How does clearing a loan affect the s.455 charge?

8. Arrangements “conferring a benefit” on a participator

8.1. What are the “conferring a benefit” rules?

8.2. What is conferring a benefit?

8.3. How much is the tax charge and when is it payable?

8.4. Can the charge be avoided?

9. Tax planning

9.1. Cheap source of short finance

9.2. How can cheap borrowing from your company be maximised?

9.3. To repay or not to repay?

9.4. Clearing the loan by dividend - a good idea or not?

9.5. Clear by salary or bonus

10. Tax terms that apply to company loans

10.1. What is a close company?

10.2. Who is a participator?

10.3. Who counts as a loan creditor?

10.4. Who is a director for these purposes?

10.5. Who is an associate?

10.6. What does “control” mean?

11. Appendix

11.1. Legislation

11.2. Original legislation

11.3. Legislation for the new rules (30-day rule etc.)

11.4. HMRC toolkit