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  • Tax - Year-end tax planning checklist
    tax planning checklist 2017/18Each tax year there are a number of tax allowances, exemptions and rate bands which if not utilised are essentially wasted as you cannot carry them forward. We've put together a handy checklist to help you avoid overlooking anything that might be available to you - particularly if you have some degree of control over your income.How do I use the checklist?Just read through the planning points and consider whether you want to utilise any of them, but be aware that you need to have...
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  • Tax - Entrepreneurs' relief checklist
    Entrepreneurs' relief checklistWhen you sell or transfer all or part of your business you might be entitled to claim entrepreneurs' relief in respect of any capital gain you make. This means that the maximum rate of tax that will apply will be 10%. However, to qualify there are conditions that you and your business must meet.When is relief available?Entrepreneurs' relief (ER) is available for qualifying business disposals. The relief imposes a lower rate of capital gains tax (10%) than the top standard rate...
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  • Tax - Request to pay capital gains tax in instalments letter
    Request to pay capital gains tax in instalments letterFor individuals, capital gains tax is payable by 31 January following the end of the tax year in which the gain occurred, e.g. 31 January 2019 for a gain made in 2017/18. Usually you'll have enough money from the transaction to pay the tax. However, proceeds may not be received all at once, for example, you might have agreed payment by instalments or you may not receive any money for the asset, but HMRC will tax the transaction as if you sold it for what...
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  • Tax - CGT unpaid proceeds claim
    CGT unpaid proceeds claim If you sell an asset and the buyer fails to pay all or part of the proceeds, and you are unable to recover them, you can claim a reduction for the amount of gain chargeable to tax. Consideration payable after saleWhere you sell an asset and agree with the buyer that payment can be made by instalments, the capital gains tax (corporation tax for companies) payable is worked out as if all the consideration (proceeds) had been paid at the time the sale was agreed. As a rule, capital gains...
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  • Tax - Claim for relief for damaged asset
    Claim for relief for damaged assetCapital gains tax may be payable on capital sums which derive from assets. For example, compensation payable to you for damage to an asset. However, if you use the amount received to repair or restore the asset, you might be entitled to defer the tax.DamageWhen an asset is damaged or destroyed it may count as a disposal (sale), or part-disposal, for capital gains tax (CGT) purposes. This applies only to assets chargeable to CGT. So, for example, it won't usually apply to machinery...
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  • Tax - Option for special method of cost apportionment
    Option for special method of cost apportionmentIf you sell a piece of land which is part of a larger estate, a little known concession could save you some tax.General ruleThe general rule for any part disposal of an asset is that the amount of the original cost attributable to the part sold is determined by the following formula: Where:A = the proceeds received for the part disposed; andB = the market value of the unsold part.In most cases, this general rule will produce a result that is logical; however, in...
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  • Tax - Claim for a capital loss for repayment of a loan as guarantor
    Claim for payment under a guaranteeOne way of helping a growing business is to act as guarantor to its loan finance. If things don't turn out as planned and you are called upon to make good some or all of the loan, you may be able to make a claim to treat this as a capital loss.Capital losses - payment under a guaranteeRather than lending it money, you may have helped a business by giving a guarantee on a business loan. For example, if you're a company director you may have had to give personal guarantees in...
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  • Tax - Claim for private residence relief to apply to a former home
    Claim for private residence relief to apply to a former homeWhen a marriage fails, tax planning is vital and sometimes urgent or avoidable tax liabilities can arise. An example of this is capital gains tax and the matrimonial home. Where one spouse (or civil partner) moves out and transfers their interest to the other as part of the financial settlement, private residence relief can be lost.  Use our letter to make an election to treat your former home as your main residence from the date of separation to the...
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  • Tax - Claim to adjust base cost for part disposal of land
    Claim to adjust base cost for part disposal of landWhen selling a small part of a piece of land you are still liable for capital gains tax (CGT). However, if conditions are met, you can make a claim under s.242 Taxation of Chargeable Gains Act 1992 to deduct the sale proceeds from the base cost of the land instead of treating it as a sale of CGT purposes.Disposing of landLand is a chargeable asset for CGT purposes which means when you sell or transfer it, you need to calculate if you've made a gain or a loss....
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  • Tax - Election to carry back earn out loss
    Election to carry back earn out lossIf you sell a business, an earn-out arrangement might be used to determine the sale price. For example, the buyer might offer the majority of the purchase price on completion of the contract plus more over three years if the business hits turnover or profit targets. You must pay tax on the amount you estimate. If you receive less, the difference is a capital loss. You can elect for the loss to be treated as arising for the year in which you sold your business instead of the...
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