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Common pitfalls

Although a recently qualified CTA I occasionally get a nasty surprise when I realise that a tax treatment is not as I might have assumed. Although I do a lot of research when advising clients / ensuring their compliance I do wonder where pitfalls might lurk. I wonder if people might be willing to share common pitfalls so I can add them to my list of things to be careful of?! Each time I make - or narrowly avoid - a mistake I add it to my "tax return / tax advice checklist" to try and help make sure I get things right. Examples are checking NICs where someone is both employed and self employed, or lessees not claiming CAs on finance leased assets (Thanks to BKD post).


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23rd Jul 2012 21:06

A common misconception that I often come across ...

... is the belief that a transfer of plant and equipment between connected persons must always be treated as made at market value (where no TWDV election is made)

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24th Jul 2012 09:30

Remember that.......

there is a 10% tax credit attached to dividends.

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By lme
31st Jul 2012 10:49

Thank you

BKD - thank you for this as I share(d) that misconception, in that under TCGAs18 I thought that transactions between connected persons must be at MV or that any gain / loss is only offset against other gains / losses between the same parties.

HMRC website says

"When to use market value -...[when]..You sell or dispose of the asset to a ‘connected person’...

Is there a planning point to your observation


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31st Jul 2012 11:59

a couple come to mind

1) ex-gratia income over 30k is not part of NRE

2) self employed clients often think VAT threshold is based on fees charged, not fees + expenses recharged; they also don't always realise that the threshold is not based on sales for financial or calendar year, but a rolling 12 months. Not exactly a planning point but can lead to a nasty surprise if client misunderstands.

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