The car is registered solely in the employer’s name, AND
The parking ticket is stuck on the car rather than being handed directly to the employee         


Wedding Bells
If someone you know is getting married, remember the IHT exemption for wedding gifts - £5,000 for each parent, £2,500 for each grandparent, and £1,000 for other relatives or friends.


Be clear about the impact of VAT on growing your business turnover.
Make sure your business plan looks at how you will deal with the impact of registering for VAT. For example, if you provide services to members of the public, registering for VAT may have major implications for your pricing structure.


Consider this!
What a lot of investors fail to realise is that if you transfer ownership of a property to another party (including husband/wife), then stamp duty will be liable if the property is mortgaged and the mortgage amount being transferred is over £125,000. This is called the ‘consideration amount’.


Shame on You!
Have you sent your accountant all the information he needs to prepare your 2005/06 tax return? If not, shame on you! This is the worst month of the year for accountants, as they struggle to complete all their client’s returns in time for the 31 January deadline. I have just spoken to an accountant client of mine, who tells me that less than half his clients have provided him with the information he needs!


Offsetting Your Personal Loan
If you take out a personal loan that is used ‘wholly and exclusively’ for the purpose of the property, then the interest charged on this loan can also be offset.


Setting up A Company
A property management company can be a way to save tax for a buy to let landlord, but do not set up a company that manages your properties and just simply start paying money into it. It is important to get the commercial arrangements and the paperwork correct. 


If you’re in doubt – Shout!
The golden rule is – if you’re not sure ask. HMRC would much rather be asked any number of questions than for you to make a mistake because you’re not sure what to do. It is in the interests of both HMRC and the business to get things right from the start, if you’re in doubt – shout!


Have you made losses on the stock market?
If you are one of the thousands of people who have lost money on the stock market, then consider selling your loss-making stocks/shares before you sell a property with a significant capital gain.


Are you using your £3,000 gift allowance?
Gifts totalling up to £3,000 in a tax year are ignored for IHT – and if you did not use the £3,000 in the previous tax year, it can be added to make a total of £6,000 that will never be taxable, even if you die within seven years of making the gift

Is your caravan exempt from CGT?
If you live in a caravan, then if it is mobile, it is likely to be a “chattel” and exempt from CGT. If it is “fixed” and connected to mains services, then it can qualify for relief from CGT as your main residence


Personal Tax Tip - Be very careful!
Be very careful about letting the purchaser start work on the property before completion of the sale – note the rule that your expenditure on improvements must be reflected in the state of the property at the time of completion of the sale, which it won’t be if the purchaser has knocked it down!


Business Tax Tip - Are you having problems?
Are you having problems with distributable profits, dividends, and waivers? There may be another way – ask your Tax Adviser about the tax treatment of loans from the company which are then written off.


Property Tax Tip - Do you have two properties?
If you have made a GWROB, ask a Tax Adviser what you need to do to convert it into a PET – once it has become a PET, it will be free from inheritance tax if you survive for seven years.


Personal Tax Tip - Don’t be ignorant!
Don’t ignore HMRC correspondence, and don’t bin it or feed it to the dog – that’s just asking them to open an Enquiry into your affairs!

Business Tax Tip - Keep records from the day you start!
Start keeping records and invoices before you start trading – most of the expenditure you incur will be an allowable expense once you open for business.


General Tax Tip - The same problems if you are in Scotland!
Trust Law in Scotland is different from that in England, Wales, and Northern Ireland – but the problems created by the 2006 Finance Act also affect Scottish Trusts.

However, a number of large high street traders have worked out that if they supply relatively low value items, mainly CD’s, DVD’s and videos, through subsidiaries in the Channel Islands, they can undercut smaller businesses by selling those goods VAT free.  This has been good for the consumer, (and explains why your last order for 4 DVD’s arrived in 4 parcels from Jersey), but bad for small businesses.


Property Tax Tip - Non- business taper relief becomes available after you have owned a property for a full three years. Try to make sure that the property is sold after a full year of ownership has been completed. For example, if you have owned a property for 7 years and 11 months, then try to delay the sale for an additional month so that you are able to claim 8 years of taper relief.


Personal Tax Tip - Do you like to gamble? Winnings on Premium Bonds are exempt from tax, and unlike other forms of gambling, you don’t lose your stake if you don’t win!


Business Tax Tip - Why not get fit, and have a company bicycle instead of a company car? There is an exemption for bicycles and cyclist’s safety equipment, provided more than half of the miles cycled are for business purposes (including travel from home to work), and bicycles are offered to all employees.


Property Tax Tip - If you offer a ‘fully furnished’ property then consider using the ‘10% wear & tear allowance’ if you are going to provide furnishings, which you do not expect to be replaced until several years later. By claiming the allowance you will receive tax relief immediately




VAT Tax Tip - It is worth pointing out that zero-rating only applies to physical printed matter, which is a supply of goods.  It does not apply to the same information or document supplied electronically (i.e. e-books), as this is a supply of services, and is standard-rated.


General Tax Tip - There is no inheritance tax on a legacy to your spouse or civil partner, is there? Oh yes there is, if the surviving partner is not “domiciled” in the UK only £55,000 of the legacy is exempt, and lifetime planning will be needed to avoid IHT on the rest.


Business Tax Tip - If you pay for your employees’ business expenses, make sure you have a “dispensation” from your tax inspector. If you don’t, you have to report all the expenses you have paid for on the employees’ P11Ds and the employees then have to make a claim for tax relief.

Dividends for couples - Married couples and civil partnerships who own businesses need to make sure both their tax allowances and lower rate bands for income tax are being used – it’s bad tax planning for one to be paying higher rate tax while the other has income of less than £37,295 for 2005/06.

Make use of the 10% wear and tear allowance - The 10% wear and tear allowance is particularly suited to ‘fully furnished’ property that has been furnished immediately after acquiring it. This is because you can start to make the 10% claim immediately from the first year of letting.


Child Trust Fund Account - If you have a child born after 1 September 2002, up to £1,200 per year can be added to their tax-free Child Trust Fund account – this sum can be made up of gifts from anyone, including the parents.


Fancy a Tax-Free Gift? - Have you been running your company for 20 years or more? Why not reward yourself with a tax-free gift? Section 323 ITEPA 2003 exempts “long service awards” to employees (including directors) with over 20 years’ service. The award must not be in cash, but with an upper limit of £50 per year of service (so 20 years = £1,000), you could buy yourself a really nice gold watch!


Personal Tax Tip - Are you in a syndicate for the National Lottery, the football pools, or something similar? Make sure there is a proper written agreement in place for the treatment of any prizes won – otherwise, the payment to members of their shares can give rise to inheritance tax liabilities!


General Tax Tip - What are you up to?
When the money laundering rules came in in 2003, one of my accountant friends told me he had simply reported all his clients on the first day, on the basis that “everyone’s up to something where tax is concerned”!