Due to the nature of their work, authors and literary artists may end up facing high tax bills in some years, but pay little or no tax in others. However, averaging profits may help some of you to reduce the amount of tax that you pay and to smooth out the variations in your annual tax bill.
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Agent authorisation
Anyone acting as a tax agent or adviser must have formal authorisation to deal with HMRC on their client’s behalf. There is no `one size fits all’ and different authorisation procedures apply for different taxes.
NLW and NMW – employer beware
The John Lewis Partnership has a reputation as an excellent employer, but the news has recently come to light that after adopting `pay averaging’ arrangements they have unintentionally fallen foul of the National Minimum Wage regulations as the payments for some `pay reference periods’ had fallen below the minimum wage.
Donations by a company
In the period leading up to the General Election you may ask us whether your personal company can make a donation to a political party. This is permitted, but the donation is not tax deductible for the company. However, the donation doesn’t create a taxable benefit in kind for the director or shareholders.
Tax deducted by banks
Since 6 April 2016 interest paid by most deposit takers: banks, building societies and NS&I, should have been paid without tax deducted. This doesn’t mean you can ignore the interest certificates issued by deposit takers, as the interest must be declared on the taxpayer’s SA return.
Employee expenses
Individuals who commence self-employment are may also be employed for part of the tax year, or continue their employment alongside their new self-employed business. When completing their SA tax return you should check whether all their employment-related business expenses have been reimbursed.