The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
Many people supply their services to clients, not directly as a self-employed person, but via a company. The tax and NIC advantages of this way of working are significant. See the Introduction to personal service companies guidance note.
Since April 2000, anti-avoidance legislation, known as ‘IR35’ or the intermediaries legislation, catches individuals who would be employees of their clients if they didn’t use a personal service company (PSC). See the Employed or self-employed guidance note. Broadly, this legislation deems income to be subject to tax and NIC, so that the individuals pays a similar amount to an employee under PAYE.
Separate legislation exists for tax and NIC. In most cases both sets of legislation produce the same outcome, but not invariably. See the Other points on personal service companies guidance note for more information.
To be within IR35 the following criteria apply:
there is an engagement for personal services where the services are provided to another person (‘the client’)
where the client is a public sector body or, from 6 April 2021, a large or medium-sized private body, separate rules for off-payroll working apply and so IR35 doesn’t. These rules are similar to IR35 but with the responsibility for deducting tax and NIC lies with a different party
the circumstances are such that the worker would be regarded as an employee of the client if the PSC was n
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Summary of capital allowances on carsThe current capital allowance rates applicable to cars are as follows:Pool typeDescription of carRateLegislationMain rate poolNew and unused cars with CO2 emissions over 50g/km but not more than 110g/km (to be reduced to 50g/km and below from April 2021)18%CAA
Income and gains may be taxable in more than one country. The UK has three ways of ensuring that the individual does not bear a double burden:1)treaty tax relief may reduce or eliminate the double tax 2)if there is no treaty, the individual can claim ‘unilateral’ relief by deducting the foreign tax
Expenditure of a capital nature is not allowed as a deduction when calculating trading profits. Expenditure of a revenue nature is allowable, provided there is no specific statutory rule prohibiting a deduction and the expenditure also satisfies the wholly and exclusively test. See the Wholly and
What is structures and buildings allowance (SBA)?From 29 October 2018, expenditure on constructing a non-residential building or structure, or in certain cases, expenditure on acquiring such a building or structure, qualifies for an SBA. The following note has been updated for the changes announced
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