I have a similar situation. Haven’t given it any thought yet. In your 9k/12k scenario, if you show the full 12k interest which reduces to 9k in the profit comp so no loss but then they are getting the “benefit” of 3k at 20%.
If you only show 9k interest in the first place then there will be some profit and a lower 20% reducer - a win for the taxman.
Add the complication of other expenses to the mix. Can you maximise the other expenses and only show a proportion of the interest so no loss is created. Back to the question of no loss created before or after the 25% tax reducer? Bearing in mind we’re working to minimise our client’s tax whilst staying within the letter of the law!
Anyone seen a worked example of this anywhere?
No. On the other hand, if they do gift aid and they are a high rate taxpayer and they do fill in a tax return then they will.
You are confusing two different things. The first is the actual physical transactions Cr cash Dr investment property 0.5m. The other is the fair value transaction - the difference between the value on the accounts and the fair value of the property at the year end date. Assuming the new fair value exceeds the cost of improving then Dr investment property Cr P&L with the difference. The property owner should have an independent valuation of the property at the year end date. The second transaction is only relevant if the property owner is a limited company and you’re preparing accounts under FRS 102.
Use the unchallengeable - they tried to set up a PTA but they failed the ID check.
Would the contractor get ER on surplus cash that’s accumulated in the business?
I suspected HMRC would make the transition complicated so my clients' wrote to Revenue, as you have to when you leave FRS, and said they were leaving FRS at end of March even if that was in the middle of their VAT period. They asked HMRC to let them know immediately if they had a problem with this. Needless to say HMRC have not been in touch with any of them. Guidance says you can leave at any time.
One of my clients' has received a coding notice for 17-18 with half her personal allowance allocated to her current job and half to the job she left in 2016. The narrative for the previous job says 'Income now ended'. Another programming error!
So the main, possibly sole driver, is only insured "with the insured person's permission" to drive the vehicle, isn't a family member and there's a financial arrangement in place between the insured person and the driver? What address does the insurance company have for the place where the vehicle is usually kept? Are the insurance company fully aware of these facts? Never mind barter or IR35 or the legality of sub-hiring, his biggest problem is no valid insurance.
The wording says "and pay Class 4 NIC". Landlords don't pay Class 4 unless they have a separate self employed business so will be employed landlords never be included? Will someone in high places wake up and realise their error? Or are we getting a wiff of another bucketful of pungentness collecting in the wings. Will Class 4 be extended to landlords when Class 2 bites the dust? Is that why they've brought in an NIC maximum calculation on the tax return? Will someone please turn the fan off. We're in danger of being swamped.
On a completely different note HMRC have been extending the turnover level at which you have to report a breakdown of expenses on the tax return for years. Isn't MTD a complete U-turn? Why couldn't they just accept the eggy faces and withdraw the option instead of coming up with this massively expensive eiephant to distract us?
I don't think the scheme is oblitered when it is closed. I closed a scheme in 2013-14 on the last FPS report when the last employee left the business. I submitted a final return months later. The company limps on with just the owner but the PAYE scheme still shows up online because she owes them a grand, which they've just noticed and started collecting.
I did the same for another one a few months ago. It saves filing nil returns and the complications of AE. It's still there online. I intend to submit a P11d in April. If it won't go through online, I'll post it with a letter of irritation.