020 8914 7835 or 07967 813065 dan@stillnessroad.com

Working from home – self employed

A self-employed person who works from home can generally claim more tax-deductible expenses than an employee or director. A self-employed worker can claim the following for use of home: All the costs incurred for exclusively for business purposes A proportion of all...

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Business Accommodation

For the self-employed accommodation costs can be tax deductible where they are incurred wholly and exclusively for the purposes of the trade or profession. Ordinary living costs are not tax deductible. In practice, HMRC tend to allow the costs of overnight...

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Contractors

Contractors usually either operate through their own limited company, or through an umbrella company. An umbrella company is a standard UK limited company, operated by a third-party supplier, which contracts with employment agencies or clients on behalf of...

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Self Employed Expenses

The broad rule is that expenses are allowable if they are ‘wholly and exclusively’ incurred for the purpose of the trade or profsesion. Often expenses don’t seem to meet this rule but are still allowed. This is because the legislation also says that when an expense is...

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Divorce

There is no general tax exemption on divorce, although there are some specific reliefs available. Maintenance between ex-spouses is always tax free for the recipient, but no tax relief is given to the payer unless either spouse was born before 1935. Marital home...

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Main Residence

Main Residence Relief If an individual sells their only or main private residence, any gain is exempt from tax. This includes the garden up to 0.5 hectares, or a larger area if required for reasonable enjoyment of the residence. If the property has not been an...

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Property Losses

If a UK property business run by an individual makes a loss, that loss cannot be offset against the individual’s other income and gains. Instead, losses can be carried forward and set against future profits of the same business, indefinitely for as long as the same...

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Replacement of Domestic Items Relief

Relief is given for the replacement of domestic items to all landlords of residential property, regardless of the extent to which the property is furnished - the previous wear and tear allowance was only available for furnished properties. The relief is not available...

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Letting and VAT

Residential letting is exempt from VAT. Landlords are unable to register for VAT if they only make exempt supplies. However, if the landlord separately has a VAT registered business, they may be able to reclaim VAT on expenses such as letting agent fees and...

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Incorporation for Landlords

Some potential advantages of incorporating a property business are: Companies are an effective tax shelter for those who wish to use their rental income to purchase new properties due to the low rates of corporation tax in comparison to income tax. Shares are usually...

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Furnished Holiday Lets

A standard furnished lettings business is an investment rather than a trading activity, even where a high number of properties are owned and serviced by the landlord. This means that various capital and income reliefs are not available to most landlords, mainly...

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Landlords – Relief for Finance Costs

From April 2017 relief for finance costs, including mortgage interest, is being phased out, with a view to limiting relief to the basic rate on the entire finance costs by the 2020/21 tax year. The withdrawal is being introduced as follows: in 2017/18 the deduction is...

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Rental – Business or Trade?

Mr and Mrs Griffiths rented out 11 properties, mainly furnished to students and other short term occupiers. They provided various amenities and services, and spent much of their spare time collecting rents, finding new tenants, inspecting properties and ironing out...

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Sale of garden

Mr Lynes sold his home but kept part of the garden and applied for planning permission to develop it. Four years later, he sold the garden and claimed main residence relief on the sale. The legislation granting main residence relief is written...

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Capital or revenue

Bullcraft Main Collieries Ltd and Samuel Jones & Co were two separate businesses. Both had factories with chimneys which were in such bad condition that each had to be demolished and replaced with a new one. In both cases, a new chimney was built while the old chimney...

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Income splitting

An IT consultant, Mr Jones, gave one of two shares in his company to his wife. He was appointed as the company's sole director, while his wife was appointed company secretary. Mrs Jones carried out some administrative work for the company, totalling about four or five...

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Clothes

Ann Mallalieu was a practising barrister, and was required to wear clothes in court which satisfied the Bar Council's requirements. Her claim for a deduction for the amount spent on court clothes was denied because the expenditure on clothes was not wholly and...

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Employed or self-employed?

ReadyMixedConcrete was a business which made and sold ready mixed concrete. Concrete was delivered by owner- drivers working under written contracts. The owner-drivers entered into a hire purchase agreement with Readymix Finance Ltd to purchase a lorry but the mixing...

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