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Taxation

Taxation comes in many forms and affects many aspects of your business and personal life. Whether it is direct tax that you pay on your earnings such as income or corporation tax or whether it is indirect tax, e.g. VAT, tax is everywhere. The old view that having an accountant will automatically reduce your tax burden is not always true. I will assist you in making sure that you are paying the correct tax but with the maximum relief available.

If you are running a business, you will need to complete the relevant tax returns, and, where applicable, pay over the appropriate tax each year.  For companies, the main tax is corporation tax; however they also need to deal with employment taxes (including National Insurance), VAT, capital gains tax, etc.  Sole traders and partnerships (via their partners) are subject to income tax and National Insurance, as well as the other employment taxes, VAT and capital gains tax. In some cases, these taxes are inter-linked.

Question

When am I likely to be caught for self assessment?

Answer

You do not need to be running your own business to be caught in the self assessment regime. There are several circumstances where the Revenue will require you to complete a tax return.

For example:

  • If you are a director of a trading company
  • If you have dividend income over £10,000
  • If you have rental income
  • If you have bank interest over £2,500 that has not had tax deducted at source
  • If you have a capital gain of over £10,100, or the proceeds were more than £40,400

Question

Do I need to tell the Revenue if I think I need to do a tax return?

Answer

If you need to complete a tax return, you must inform the Revenue by 5 October following the Tax Year for which you are liable. This is your responsibility and you should not wait for them to say you must to do one.