Tax Tips and Business Advice

Posted on by Ceri John

Some easy and straightforward tax tips and business advice for limited companies.

If you have just become a limited company and you are considering your next step please read the following points and find practical advice that could save you money and ensure that your company runs smoothly;

  • Once you are officially a limited company make sure you tell HMRC that you are trading or you may incur a penalty. HMRC will usually send you a CT41G form to complete. In order to avoid any penalties or fines you must return it within 3 months of receipt.

 

  • As a director do not forget to register as an employer if you have people on payroll within the company.

 

  • If you are thinking about buying a car then it may be best to keep it out of the company.  Company cars can attract hefty benefit in kind taxes. In this instance it may be better to buy the car personally and then charge the company your mileage for business use. You can receive up to 40p per mile for the first 10,000 business miles in a tax year, 25p per mile over 10,000 miles tax free per year.

 

  • If you have gone from a sole trader to a Ltd company and you are VAT registered then do not forget to transfer your VAT number over to the Ltd company.

 

  • If you are VAT registered check that you are on the best scheme for you. There are schemes such as cash accounting and flat rate which may be beneficial for your business and in particular your bank account.

 

  • As a Ltd company you may be able to take advantage of some tax savings but you have to do it correctly.  The most common is splitting the owners drawings between salary and dividends, saving them personal tax, but there are some rules to follow, so seek advice from an accountant if you are unsure.

 

  • Thinking about a pension?  Speak to an IFA/pensions advisor about setting one up through your company.  The company can get tax relief and it can be a very tax efficient way of using up some of the extra funds in the company.

 

  • If you work from home then make sure that you claim for the expenditure that is allowable.  It must be done so with care however and there are strict guidelines on this matter that should be consultated.

 

  • Finally, file your accounts and tax returns on time to avoid penalties.  It sounds obvious but time has a habit of slipping away and before you know it, your filing deadline will be looming.  Get into good habits with your paperwork from day once and save yourself the last minute stress.

 

Information in this article is provided by Lucy Cohen of Mazuma, a member of the BIRR Accountancy Partnership Programme.

Mazuma promotes the idea of being accountants evolved, highlighting the ease of it’s service and the fact there are no spreadsheets, no software and no fuss.

For more information on Mazuma and their service to provide all accountant work for as little as £17 per month for a sole trader and £55 per month for limited company contact Jonathan at BIRR Legal Services.

Categories: Accountancy, Information

«

»