Yes, the DTA doesn't give the answer to my question. However, the note on the Foreign pages does...
"If you’re claiming Foreign Tax Credit Relief on income included elsewhere in your tax return, fill in the columns below and say in the ‘Any other information’ box (on page TR 7) where on your tax return this income is included."
Yes. I've just posted this in another any answers question where they were having issues with HMRC/class 2...
I have submitted returns to HMRC showing that full class 2 NIC was payable for the year and this was reflected in my own tax calculations, but they amended the return so that class 2 was not due.
I have informed each client that HMRC may come knocking for the class 2 NIC when they realise.
Not exactly the same, but similar. I submitted a return showing that full class 2 NIC was payable for the year and this was reflected in my own tax calculation, but they amended the return so that class 2 was not due.
I've just dealt with a couple of these. You have to phone the contributions agency and explain that the class 2 contributions aren't due based on the level of earnings in the previous years. They will update their records from there. However, you will have to go back to the "tax" department of HMRC to get refunds. I am finding that the latter part of this process is taking time to process.
Thanks Simon. No AIA are being claimed in the year of cessation. Although tranferring the assets at WDV would be simpler, in this case, wouldn't be more tax efficient.
On further digging, it would seem as though there would have to be an election made under CAA 2001, s266 to apply for the WDV to be carried forward as a going concern. I would therefore assume that putting a value on the assets at cessation and subsequently claiming a balancing allowance as the sole trader would be acceptable. The market value of the assets, £6.5k, could then be introduced into the limited company but not claimed under AIA as it is an associated business. Have I answered my own question correctly?
...The other usual trick is to reduce the amount of work taken on to stay below the registration level...
But therein lies the problem. It's counter-productive to growth if businesses are reducing the amount of work undertaken to stay below the VAT threshold. I just think it's a big leap for some businesses to go VAT registered and has a negative effect if their customers aren't VAT registered.
Thanks Zarathustra. A more realistic approach would be to have a "band rate" system similar to income tax. It seems unfair to ask someone to start adding 20% onto their prices just because they've reached a certain level of "sales" even if those sales are largely materials.
My answers
Yes, the DTA doesn't give the answer to my question. However, the note on the Foreign pages does...
"If you’re claiming Foreign Tax Credit Relief on income included elsewhere in your tax return, fill in the columns below and say in the ‘Any other information’ box (on page TR 7) where on your tax return this income is included."
Thanks anyway.
Yes. I've just posted this in another any answers question where they were having issues with HMRC/class 2...
I have submitted returns to HMRC showing that full class 2 NIC was payable for the year and this was reflected in my own tax calculations, but they amended the return so that class 2 was not due.
I have informed each client that HMRC may come knocking for the class 2 NIC when they realise.
Not exactly the same, but similar. I submitted a return showing that full class 2 NIC was payable for the year and this was reflected in my own tax calculation, but they amended the return so that class 2 was not due.
Ftax requires a manual input of class 2 NICs. I have been in touch with them and "The SA100 will be upgraded soon to make it clearer".
That's great MBK. Thanks for your help.
Yes they can do something about it.
I've just dealt with a couple of these. You have to phone the contributions agency and explain that the class 2 contributions aren't due based on the level of earnings in the previous years. They will update their records from there. However, you will have to go back to the "tax" department of HMRC to get refunds. I am finding that the latter part of this process is taking time to process.
Thanks Simon. No AIA are being claimed in the year of cessation. Although tranferring the assets at WDV would be simpler, in this case, wouldn't be more tax efficient.
On further digging, it would seem as though there would have to be an election made under CAA 2001, s266 to apply for the WDV to be carried forward as a going concern. I would therefore assume that putting a value on the assets at cessation and subsequently claiming a balancing allowance as the sole trader would be acceptable. The market value of the assets, £6.5k, could then be introduced into the limited company but not claimed under AIA as it is an associated business. Have I answered my own question correctly?
Therein lies the problem
But therein lies the problem. It's counter-productive to growth if businesses are reducing the amount of work undertaken to stay below the VAT threshold. I just think it's a big leap for some businesses to go VAT registered and has a negative effect if their customers aren't VAT registered.
VAT Threshold
Thanks Zarathustra. A more realistic approach would be to have a "band rate" system similar to income tax. It seems unfair to ask someone to start adding 20% onto their prices just because they've reached a certain level of "sales" even if those sales are largely materials.