Merranti Accounting Blog

Working from home

Allowances for homeworking

October 13, 2021

Allowances for homeworking  If your employees are required to work from home, even on a part-time basis, you can pay them a tax-free allowance of £6 per week. This allowance is designed to compensate for additional electricity, gas or water consumed while working at home. Where the employee uses their own telephone for business, you

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Tax up or down accounting

Change to ‘tax year’ basis

October 13, 2021

Change to ‘tax year’ basis   The Government is proposing to change the basis on which trading profits are subject to income tax for unincorporated businesses and members of limited liability partnerships (LLPs) from the “current year basis” to the “tax year basis”. If the proposal goes ahead from 6 April 2024 (and there is much

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How to earn back corporate losses

October 13, 2021

How to earn back corporate losses Did your company have a bad pandemic? Don’t panic, you may be able to turn a loss into a useful tax repayment by carrying it back to set against profits made in earlier years. If the loss is so big that it wipes out the profit made in the

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Valid VAT invoices

October 13, 2021

Valid VAT invoices   It is important to include enough information on your VAT invoices to allow your VAT-registered customers to reclaim the VAT charged. HMRC will block recovery of VAT charged on invoices that don’t clearly state what goods or services were supplied. HMRC officers are particularly looking at invoices in the construction sector (following

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VAT changes for hospitality

October 13, 2021

VAT changes for hospitality   In July 2020 the government cut the standard rate of VAT to be used in the hospitality and tourism sectors from 20% to 5%. The reduced rate applies to most supplies made by hotels, tourist attractions, members’ clubs and many non-sporting events. It also applies to the food and drink served

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Tax up or down accounting

How to carry back income tax losses

October 13, 2021

How to carry back income tax losses    Many unincorporated businesses made a loss in the tax year 2020/21, due to the pandemic. Now it’s important to make the most of such losses. By carrying back the trading losses to an earlier tax year in which you made profits in that trade, you may be

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Electric cars and vans

October 13, 2021

Electric cars and vans  Now could be a good time for your company to invest in an electric car or van, as there are generous tax reliefs available. A purely electric car qualifies for a 100% first year allowance (FYA) if it is acquired before 1 April 2025. This means that it is deductible fully

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Claiming capital allowances

October 13, 2021

Claiming capital allowances   Capital allowances of 130% are currently available on some plant and machinery. Buildings and structures do not usually qualify as plant, but there are exceptions. Agricultural structures have been shown to be ‘plant’ rather than buildings for tax purposes in the case of mechanised grain silos and potato stores. In both cases

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National Minimum Wage: Common traps

October 13, 2021

National Minimum Wage: Common traps    The top three mistakes made by employers concerning the National Minimum Wage (NMW) rates are: 1. Making deductions from wages (such as uniform or expenses) which take the pay below the NMW rate; 2. Failing to pay workers for all the time they work, including overtime; 3. Paying the

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Prepare for Making Tax Digital for income tax

October 13, 2021

Prepare for Making Tax Digital for income tax    From 6 April 2024 most unincorporated businesses will have to comply with the Making Tax Digital for Income Tax Self Assessment (MTD ITSA) regulations. Individuals with trading and/or property income of less than £10,000 per year in total will not have to comply with MTD ITSA. Where

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