Capital Gains Tax is a tax on any profits made when you sell or dispose (giving away as a gift, transferring ownership, swapping, getting compensation) of an asset that has increased in value. It is only the gain that you make that is taxed not the amount of money you received for the asset.

Some assets are tax-free, and you may not have to pay CGT if all the gains in a year are under your tax-free allowance. There are also special rules for gifts or assets that are disposed to your spouse, civil partner, or charity.

Capital Gains Tax can be complex so if you need any support, please contact us. 

The records you will need include all receipts, bills and invoices that show the date and amount:

• You paid for an asset
• You received for the asset

You should also keep copies of:

• Any additional professional advice or to establish market value
• Any contracts relating to the buying and selling of the assets
• Any copies of valuations
• Any expenditure on the asset which has increased it’s market value

Records will be required to work out the gains that need to be completed in your self-assessment tax return. As an individual you will need to keep any records relating to CGT for at least a year, but if you file your tax return late or HMRC want to complete a check you will need to keep them for longer. Businesses must keep records for 5 years after the deadline.

Construction Industry Scheme (CIS) is the process of contractors deducting money from subcontractor payments and passing on these deductions to HMRC. These deductions count as advance payments towards the sub-contractor’s tax and national insurance (NI).

You are considered a contractor if:

• You pay subcontractors to complete construction work
• Your business doesn’t do construction work, but you have spent more than £3M on construction in the 12 months since you made your first payment

You are considered sub-contractor if you do construction work for a contractor.

Both contractors and subcontractors must register for CIS. You must register for both if you fall under both categories.

You can register as a contractor here.

You can register as a sub-contractor here.

CIS covers most construction work to:

• A permanent or temporary building or structure
• Civil engineering work like roads and bridges

For CIS, construction work includes:

• Preparing the site for example, laying foundations and providing access works
• Demolition and dismantling
• Building work
• Alterations, repairs, and decorating
• Installing systems for heating, lighting, power, water, and ventilation
• Cleaning the inside of buildings after construction work

This CIS guide for contractors and subcontractors has more detail on what is and is not covered by the scheme.

If you’ve charged more VAT than you’ve paid, you must pay the difference to HMRC one month and 7 days after the end of your VAT accounting period.

If you have paid more VAT than you have charged, then HMRC will usually pay you the difference.

If we are completing your VAT returns on your behalf, we will let you know how much is due to be paid (or refunded to you), how to make the payment and the deadline to make the payment.

For help with your VAT return please contact our specialist VAT team.

There are two ways to pay your VAT bill:

• Direct Debit
• Online via the UK website

Paying by direct debit is the cheapest way to pay. Any VAT bills that are due will be collected automatically on the 10^th of the month following the due date of your VAT return.

Paying manually via the gov.uk website with a card typically carries a card processing fee. 

If you meet the requirements to register for VAT and fail to do so, then you may face penalties. 

The fine will be worked out based on the VAT owed and how late the registration was. The VAT you owe from the point of registration will be added to your penalty which can get expensive quickly!

You will also be required to pay over VAT on 1/6 of your sales that fall into the late registration period. If you only deal with fellow VAT-registered businesses you may be able to add the VAT to your sales and recover this amount from them. You will also be able to recover VAT on any expenditure during this period.

Need some help with your VAT registration or concerned about a potential fine? Speak to one of our VAT experts on 01296 681341.

When you register for VAT, there will be a crossover between submitting your application for VAT and getting your VAT number.

If you still want to invoice customers, then you can’t show VAT on your invoices until you have a VAT number. However, you will still have to pay the VAT to HMRC for any sales you make in this period.

As you will need to pay HMRC VAT on your sales then you can increase your rates by the relevant VAT amount. So, for a £100 product at the standard VAT rate, you can increase your price by 20% and charge £120.

Once you have your VAT number you can re-issue the invoices showing the VAT amount. Then your customer can also reclaim any VAR on their purchase from you.

Some businesses prefer to delay issuing invoices until the VAT number has arrived however the lead time for some VAT Registrations can take several weeks. So delaying invoicing may impact cashflow.

On the face of it, payroll may seem like a simple task however it is crucial that you get your payroll right and keep it within the law. Choosing how to manage payroll is an important decision and is something you should prioritise.

If you don’t have the administrative resources or expertise to run payroll, then seeking support from a professional will help to:

• Minimise errors – a professional should be using software with automation to reduce the risk of manual data entry errors or calculations
• Ensure compliance – government regulations change, and professionals will often learn about these changes in training updates and can then take the lead in making the necessary adjustments
• Meet deadlines – there are HMRC payment deadlines for employers and if you don’t comply with the regulations or meet the necessary deadlines there are fines and other associated costs
• Complete all reporting – each month employee payments and deductions need to be reported to HMRC on or before each payday
• Save time – leaving payroll processing and management to those that have the relevant expertise can give you more time to focus on your business

Finally, if you are the director of a company, then there may be a more tax efficient way to pay yourself using a combination of payroll and dividends. A payroll professional can actively manage this on your behalf.

Want to understand more about our payroll services? Speak to our in-house payroll specialists.

For BAS clients the answer is simple, there is a dedicated section in your Bright Pay portal labelled HMRC this will clearly show any outstanding liabilities.

If you run payroll yourself, you will need to calculate what you owe HMRC yourself and then pay HMRC yourself.

You can detail in your will anything you wish, from what happens to your rabbit when you die or where you wish your funeral to take place to who you wish to inherit your home.

• You can choose who you trust to carry out your wishes by appointing them as executors to deal with your affairs, as set out, in your will.
• You can specify who you wish to receive your estate.
• If you have dependent children, you can put into place provisions for their care if you are no longer here, including nomination guardians for them.
• If you have any specific gifts, jewelry for example, it ensures your wishes are followed and they are given to the correct person.
• If there is someone you wish to exclude from your will, you are able to do this (please note however that this can be challenged in the courts if the excluded party does not agree with the treatment).

• If you are married or in a civil relationship and have no children

  i. then your entire estate would go to your spouse or civil partner.

• If you are married or in a civil partnership and have children

  i. The first £322,000* of your estate would go to your spouse or civil partner, along with any personal possessions.

  ii. Anything over £322,00* would then be divided with your spouse or civil partner receiving 50% and your children receiving 50% of the estate (divided between them if there is more than one child. Please note that under the rules of intestacy only natural and adopted children are recognized, they do not acknowledge step-children.

• If you are not married but have a long term partner, they will not be entitled to any of your assets held in your sole name. Cohabiting/long term partners are not recognised under the rules of intestacy. If you have children then your estate would pass to them. If you do not have children your estate would pass firstly to any surviving parent of the deceased and then move along to any siblings, aunts, uncles cousins etc.

• Spend your money or give it away during your lifetime (obviously this comes with a warning to make sure you keep enough that you will need or potentially need in your life time)

  i. There is a 7 year rule when gifting money during your lifetime.The percentage IHT tax rate applied would reduce as follows
  1. Up to 3 years prior to death 40%
  2. 3 to 4 years prior to death 32%
  3. 4 to 5 years prior to death 24%
  4. 5 to 6 years prior to death 16%
  5. 6 to 7 years prior to death 8%
  6. 7 years or more 0%

• Release equity in your property and spend it now

  i. Ensure you leave yourself enough to live on.

• Maximise your pension allowance – £60,000 per year (check with your IFA to see if this is appropriate for your circumstances)

  i. Most pensions are treated outside your estate meaning any money in your pension could be passed on tax-free. Please ensure a nomination form has been completed for any pensions.

• Annual exemption – you can give away £3,000 each tax year without attracting any inheritance tax
• Wedding Gifts – you can give cash gifts to newlyweds, the level of tax relief varies depending on your relationship to them.

  i. Parents and step-Parents can give up to £5,000 tax free

  ii. Grandparents can give up to £2,500 tax freeiii. Other relatives and friends can give up to £1,000 tax free

• Small gifts – these are gifts of up to £250 and are defined as small gifts. You can make as many of these as you wish without any inheritance tax implications. Be sure that the gifts cannot be classed as part of a larger gift.

A person or persons appointed by the will maker to administer the estate of the deceased.

The property of the deceased person to which he/she is beneficially entitled.

a tax payable when an estate is over the inheritance threshold (currently £325,00).

The name given to the person who is making the will.

An LPA ensures that someone you trust can make decisions on your behalf if you’re unable to due to illness, injury, or other circumstances. Without an LPA, your loved ones or business associates may face legal complications or delays in managing your affairs.

You should choose someone you trust, who is capable of handling the responsibilities. For personal LPAs, this might be a close family member or friend. For business LPAs, it’s often advisable to appoint someone with knowledge of your business, such as a trusted partner or professional advisor.

While you can create an LPA yourself, working with a professional ensures the document is legally valid and tailored to your needs. This is especially important for business LPAs, where the wording may need to account for company-specific requirements.

Yes, as long as you have mental capacity, you remain in control of your decisions. Your attorney(s) will only act if you’re unable to do so.

Yes, you can update or cancel your LPA at any time, provided you still have mental capacity. If you want to make changes, you will need to create a new LPA.

We offer:

· Expert advice on personal and business LPAs

· Tailored drafting to meet your specific needs

· Full support with the registration process

· Guidance on choosing the right attorneys for your circumstances