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2010

35p FFS

35p FFS

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Just putting this out there - so busy people please ignore.

Fate would decree that the first tax returns I do for 15-16 are for a partnership, and both their tax and Class IV liabilities come to £855.  Being unsure about the new Class 2 rules I left things at that when I did the accounts, but now doing the tax our new friend Class 2 national insurance brings both my clients to a liability of £1000.35 - and my computer dutifully calculates the payments on account of £500.17.  So we've gone from 860 quid each to two grand (I believe that's known as an Archer) each in the first half of 2017.  I have previously dug around about how Class 2 affects POAs, but I can't see any special rules taking it out of the calculation, like with capital gains tax.

Screw that.  I've taken a stern look at some adjustments for disallowed expenses, and by rounding things differently I've saved my clients 58p tax and NI each.

Do I report myself to SOCA?  No - they are now the National Crime Agency.  Agents for national crimes.  Should I move to Panama before I do this?  Should I change careers, perhaps becoming a shill for software companies?  Should I just end it all?

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19th May 2016 14:01

Reported for money laundering.

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19th May 2016 14:04

Get some new tax software. There are no payments on account due, the NIC2 should not be included in the relevant amount.

Thanks (1)
to Tim Vane
19th May 2016 14:34

Tim Vane wrote:

Get some new tax software. There are no payments on account due, the NIC2 should not be included in the relevant amount.

Agree. Class 2 NIC is treated like CGT - it's not part of your POAs.

Why didn't you take the opportunity to charge the clients an extra fiver ? Everyone's then a winner!

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to Tim Vane
20th May 2016 11:38

Tim Vane wrote:

Get some new tax software. There are no payments on account due, the NIC2 should not be included in the relevant amount.

Indeed apparently not - the only place I can find any specific mention of this is here:

http://www.ion.icaew.com/Taxforum/post/Payments-on-account-of-Class-2-NI...

HMRC's website takes the usual implication by omission route.

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