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?

Replies (4)

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By Duggimon
19th May 2016 14:01

Reported for money laundering.

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By Tim Vane
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)
Replying to Tim Vane:
RLI
By lionofludesch
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!

Thanks (2)
Replying to Tim Vane:
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By stevebritgimp
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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