The Chancellor announced in his Budget changes to the expenses regime, both on a general level for smaller businesses and more specifically on a cash-accounting basis.
Here Rebecca Benneyworth examines the finer details of changes to flat rate expenses, as outlined in her Budget report, sponsored by TaxCalc.
Benneyworth explains that the legislation amends ITTOIA 2005, so this does not apply to companies, and there is a further restriction on partnerships in which one or more of the partners is not an individual.
The proposed legislation recognises three distinct types of flat rate deduction, the most important of which is for vehicles.
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- Expenditure on vehicles
- Use of home for business purposes
- Deduction: per month or part month
- Premises used as both home and business premises
- Private use adjustment: per month or part month.