Guildford accountants

VAT

Paul is in business as a general builder.  He is also in partnership with
- John as "PJ Repairs & Maintenance"
- Peter as "Kwick Repairs"
- Sarah (his wife) as "Speedy Repairs"

How many VAT "persons" exist here?

VAT law recognises a "taxable person" rather than a business.  This rule is really designed to stop people avoiding VAT by establishing businesses with a turnover below the VAT registration threshold.  Customs may also questions whether or not there really is a separation of activities between different persons.  In this situation there are four possible taxable persons.

Capital Gain

Emma drops and destroys a vase.  She receives compensation of £2000 from her insurance company.  How can she avoid paying capital gain?

By investing the £2000 compensation in a replacement asset within 12 months, Emma could avoid paying tax.

IR35

Landscape Ltd employed Shaun as a computer programmer until 31 December 2008.  On 1 January 2009 Shaun set up as a self-employed computer programmer.  Shaun continued working for Landscape Ltd and during the months 1 January to 5 April 2009, invoiced them for the work done based on an hourly rate of pay.  Shaun works five days a week at the office of Landscape Ltd, uses their computer equipment and does not have any other clients.

Can Shaun consider himself to be a self employed person?

The distinction between employment and self employment is a fine one.  Employment involves a contract of service, whereas self employment involves a contract for services.  Taxpayers tend to prefer self employment as the rules of deductibility of expenses are more generous.  However, the scenario suggested in the example suggests that HMRC would regard Shaun as an employee rather than self employed.

Inheritance Tax

Don gives some money to his daughter Elizabeth on her marriage to Simon.  What marriage exemption is applicable for inheritance tax purposes?

The marriage exemption for a gift to a child is £5000.

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