YET MORE TASKFORCES LAUNCHED
HMRC’s success in obtaining tax arrears from a wide range of business sectors within selected geographical areas has encouraged them to announce another 5 taskforces for “intensive bursts of targeted activity”.
They expect to recover more than £19.5 million from the following areas:
The legal profession in London (yes, the accountancy and tax professions are expecting to be on the list in the future!)
Grocery and retail in South Wales, North Wales, NW England and SW England
Hair and beauty in the North East
Restaurants in the South East and Solent
The Motor trade in Scotland
If you fall within any of the above categories, or know someone who is, check of your business records to identify any problems before HMRC come calling.
USING YOUR HOME FOR BUSINESS?
We always look to maximise your tax breaks if you use your home for business, as they can be considerable (with care). For example, if there is non-exclusive business use of a room in your home, there is a claim which can be made for a proportion of the running costs; this does not automatically result in a restriction to the valuable CGT exemption on sale of the main private residence. This is because a claim for, say, 90% business use of one room means that the room was not used exclusively for business purposes and accordingly no loss of CGT relief applies.
Sometimes it is simpler to make an expenses claim based on a round-sum allowance for the general business use of the home, which would certainly eliminate any restriction of the CGT exemption. The above situation is hardly likely to arise where, for example, the business you carry out at your home address is that of a dentist, doctor, vet or architect, i.e. plenty of activity in terms of patients, customers or clients visiting you. Indeed there may be separate buildings used solely for business use.
As you may imagine, in such a case there are all sorts of clever things which can be done to maximise the CGT residence exemption on a sale and at the same time ensure that the gain which is taxable suffers tax at only 10%, because it qualifies for entrepreneurs’ relief. Planning is essential to achieve this result.
HIGH NET WORTH UNIT
You may be delighted if HMRC use this unit to look after your tax, as it means you have substantial assets. However, according to HMRC it also means that you are more likely to be inclined to seriously consider a variety of ways of reducing your tax bill!