Accounting Resources

Each tax year, UK individuals benefit from a Capital Gains Tax (CGT) annual exemption – a valuable allowance that enables gains up to a certain threshold to be made free of tax. However, with recent reductions in this exemption, it’s more important than ever to make the most of it.

It’s not uncommon for directors of small companies — particularly those with a background in self-employment — to blur the lines between business and personal finances. However, it’s essential to remember that a limited company is a separate legal entity, and treating company funds as a personal wallet can lead to unexpected tax consequences.

Recent developments have brought notable changes to Capital Gains Tax (CGT), with significant shifts in 2024 and more on the horizon. With the Labour government having recently passed a Budget and a Spring Statement on the way, now is a good time to assess where we stand with CGT in early 2025.

In this blog post, we review the recent case of Robson v Revenue and Customs on employment status, highlighting valuable lessons for businesses and contractors engaging in similar arrangements.

As the tax year-end (5 April) approaches, now is the perfect time to review your finances and make sure you’re making the most of available tax reliefs. A few simple steps could help you save money and ensure your tax affairs are in the best possible shape.

Employment Allowance (EA) is a valuable relief available to eligible employers in the UK, allowing them to reduce their annual National Insurance (NI) liability by up to £5,000. This initiative helps businesses manage employment costs and encourages job creation. Understanding whether you qualify and how to claim this allowance can lead to significant savings for your business.

For many small business owners, incorporating their business once made sense for tax efficiency and limited liability. However, with recent tax changes, some owner-managed businesses may now find that reverting to a sole trader or partnership structure is more beneficial. Disincorporation is not as straightforward as incorporation, and business owners must carefully consider the tax and legal implications. This article explores the key practicalities of disincorporating a business, providing insights and examples to help you navigate this complex decision.

For years, many small business owners have chosen to operate as limited companies because of the tax advantages. The ability to control when and how profits are withdrawn, combined with lower National Insurance contributions (NICs) on dividend payments, made incorporation an attractive option. However, with recent tax changes, it may no longer be the most efficient structure for all businesses.

If you're self-employed, you might have considered bringing in a family member, like your university-aged child, to help out in the business. It’s a great way for them to earn extra cash and gain experience, but when it comes to tax deductions, things can get a little tricky. Paying wages to a family member has to be done properly to stay compliant with HMRC rules.