Frequently asked questions

You need to register with Revenue & Customs as soon as your circumstances change, for example:

  • If you start your own business
  • If you receive untaxed income from investments
  • If you receive income from renting property
  • If you need to claim expenses (you need a tax return if they're above £2,500)
  • If you have Capital Gains Tax to pay
  • If you or your partner receives Child Benefit and your income is over £50,000.

The above list is not exhaustive, if you have any queries please contact a member of our team. The latest you should register is by 5 October after the end of the tax year for which you need a tax return. The tax year runs from 6 April one year to 5 April the next. If you register late you may have to pay a penalty.

Your self-assessment tax return needs to be filed by 31 January (for online filing) or 31 October (for paper filing) in the year following the tax year ended 5 April. For example, for the tax year ended 5 April 2014 the relevant dates are 31 October 2014 and 31 January 2015.

Yes. There is an initial flat rate penalty of £100, for failure to submit your self assessment tax return on time. The penalty increases at various intervals depending on how overdue the return is.

For the tax year ended 5 April income tax is due to be paid by 31 January in the following year. For example, for the tax year ended 5 April 2014 payment is due by 31 January 2015.

Some taxpayers are also required to make payments on account towards the following tax year and these are due to be paid on 31 January and 31 July.

If you are liable and have received a Child Benefit payment since 7 January 2013 then you must register for Self Assessment by 5 October 2013 to pay the charge.

If you take on employees and pay them at or above the lower earnings limit you will need to register as an employer and make statutory deductions. For further information on when to do this please contact a member of our team.

PAYE and NIC and any other statutory deductions are due to be paid by the 19th of the month, for the period ending the 5th of the month. For example, liabilities due up to 5 April are due to be made by 19th April.

  • full name
  • full address
  • date of birth
  • gender
  • National Insurance number
  • tax code
  • P45 if they had a previous employment showing total pay and tax paid to date for the current tax year
  • student loan deduction status.

Everyone can earn a certain amount each year without paying any income tax. This is called your personal allowance. For the tax year ended 5 April 2015 the standard personal allowance is £10,000.

You can earn up to £153 a week for the tax year ended 5 April 2015 before you pay any national Insurance contributions.

RTI stands for Real Time Information. It involves sending information to Revenue & Customs instantly about your employees and any deductions you have made from their salaries. All employers must operate on the RTI basis. For further information contact a member of our team.

The government is implementing major changes with regard to pensions which affects all employers. Each employer will be obliged to provide a workplace pension scheme for qualifying employees. The rules and dates of implementation vary depending on the number of employees and are quite complex, and therefore if you require any further information please contact a member of our team.

It is anticipated that there will be a large volume of administration work to be carried out by the employer in advance of implementing the scheme, and it is therefore advisable to be proactive in setting what are your individual requirements and establishing a relationship with a pension provider to ensure implementation happens by the deadline. There are penalties for non-compliance.

If your turnover of VAT taxable goods and services supplied for the previous 12 months is more than the current registration threshold of £81,000, or you expect it to go over that figure in the next 30 days alone, you must register for VAT. However, if your turnover has gone over the registration threshold temporarily then you may be able to apply for exception from registration - see the Revenue & Customs website for further information.

The standard VAT return period is quarterly, your VAT return is due to be filed online one month and 7 days after the end of the VAT period.

Payment needs to be made online one month and 10 days after the end of the VAT period.

Unless you are filing your company’s first accounts the time normally allowed for delivering accounts to Companies House is:

  • 9 months from the accounting reference date for the private company; or
  • 6 months from the accounting reference date for a public company

For example, if your year end is 31 December you have until 30 September the following year to file the accounts.

Yes. The level of the penalty will depend on how late the accounts are filed. The initial penalty for a private limited company is £150 and for a PLC is £750. The penalty increases at various intervals depending on how overdue the accounts are.

In addition, where the accounts are late in two or more consecutive years, the above penalties will double.

Yes. There is an initial flat rate penalty of £100, for failure to submit your corporation tax return on time. The penalty increases at various intervals depending on how overdue the return is.

All businesses are different and there are various vehicles such as sole-trader, partnership, company and Limited Liability Partnership (LLP). We would recommend contacting a member of our team to discuss your requirements and ensure the appropriate vehicle is chosen to match your circumstances.

Each individual will have to assess their own needs and seek their own advice with regards to the benefits of incorporating however in summary some of the advantages and disadvantages are as follows:

Advantages

  • Limited liability (subject to personal guarantees provided)
  • Small business tax savings
  • Credibility
  • Raising money
  • Income control / distribution

Disadvantages

  • Additional compliance
  • Costs of incorporation
  • Credibility
  • Directors legal responsibilities
  • Information on public record

If you are self employed and you send your tax return on or before the 31 January you must keep your records for at least 5 years and 10 months after the end of the tax year the tax return is for.

Example

  • If you send your 2013 to 2014 tax return online by 31 January 2015, you must keep your records until at least the end of January 2020.
  • If you send your tax return after the 31 January deadline, you must keep your business records for whichever of the following is longer:
  • 5 years and 10 months after the end of the tax year the tax return is for 15 months after you send your tax return

You must normally keep records for a limited company for at least 6 years from the end of the last company financial year they relate to.

Accounts for companies and limited liability partnerships (LLPs) do not have to be audited for financial years starting before 6 April 2008 or prior to 1 October 2008 for LLPs if you:

  • qualify as a small company or LLP for the purposes of filing abbreviated accounts
  • have a turnover of no more than £5.6 million
  • have a balance sheet total of no more than £2.8 million

For financial years starting on or after 6 April 2008, to qualify for total audit exemption, a company must:

  • qualify as a small company
  • have a turnover of no more than £6.5 million
  • have a balance sheet total of no more than £3.26 million

Small and medium-sized LLPs can take advantage of the higher thresholds for accounting periods starting on or after 1 October 2008.

The above questions are not exhaustive and to find out what is the best solution for your business, please contact a member of our team.

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