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 CTG 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

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 fall under the requirements and do not register for VAT, then you will face some 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!

As well as receiving a penalty for late registration you could also be charged with a penalty for failing to notify HMRC. In some cases, you may even be given a civil evasion penalty.

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 VAR 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.