Getting around a city by bus, car or taxi can be frustrating, with traffic congestion often making journeys slow and unpredictable. Travelling by bicycle can be quicker, cheaper and better for the environment. If you run your own limited company, buying a bicycle through the company can also be a tax-efficient way of providing transport for commuting and business travel. However, there are tax rules to consider. Option 1: The company buys the bike The simplest approach is for

In November 2025, the government announced a joint strategy involving HMRC, the Insolvency Service and Companies House to crack down on what is termed ‘contrived insolvencies’ i.e. company closures engineered to avoid paying tax through the use of so-called ‘phoenix companies’. The measures signal a tougher approach to directors who repeatedly abandon companies with unpaid tax liabilities before starting near-identical businesses. What is ‘phoenixing’? Phoenixing is where a c

Whether you sell unwanted items on eBay or Vinted, rent out a property on Airbnb, freelance through online platforms, drive for a delivery app, earn money as a content creator, gardener, babysitter or even hire out personal equipment, it is important to understand when this extra income needs to be reported to HMRC. The government has announced plans to increase the self-assessment reporting threshold for trading income from £1,000 to £3,000 within the current parliament, by

The Community Infrastructure Levy (CIL) is a charge which can be levied by local authorities on new development in their area. The levy will only apply in an area where the local authority has consulted on and approved a charging schedule which sets out its levy rates and has published the schedule of rates on its website. Scope Most developments which create net additional floor space of 100 square metres or more or which create a new dwelling are potentially with the scope

Incorporation relief is a valuable relief that allows landlords to postpone the capital gains tax bill that may otherwise arise when transferring an unincorporated property business to a limited company. The relief, which is no longer given automatically and must be claimed, applies where the business is transferred to a company wholly or partly in exchange for shares. To the extent that the gain relates to shares received in exchange, it can be rolled over such that the base

Different taxes have different rules, and it is important to consider the full picture. Looking at one tax in isolation may lead to an unexpected bill. Most people are aware of the capital gains tax rule which allows spouses and civil partners to transfer assets or a share in an asset between them at a value which gives rise to neither a gain nor a loss – the transferee simply takes on the transferor’s base cost. This can be handy when putting a house or a flat into joint nam

Businesses which give away free gifts or samples need to be aware of the VAT implications to ensure that they account for VAT correctly. Gifts Where a business makes a free gift, they do not receive any consideration in return. If input tax has been incurred in relation to that gift which can be recovered, the business must account for VAT on the cost value of the gift unless the gift is a business gift. Business gifts A gift is a business gift if it is made in the course of

Employer’s Class 1 National Insurance is a significant cost for employers, being charged at 15% on earnings over the relevant threshold. However, there are some steps that employers can take to reduce their bill. Claim the Employment Allowance The Employment Allowance is a valuable allowance which reduces an employer’s secondary Class 1 bill by up to £10,500 a year. The allowance is capped at the employer’s secondary Class 1 liability for the year where this is less than £10,

Mandatory payrolling was due to come into effect from 6 April 2027. However, it has now been announced that the introduction will be phased in, with mandatory payrolling only applying to benefits in kind in phase one from 6 April 2027, with all remaining benefits in kind (with the exception of taxable cheap loans and living accommodation benefits) being brought within mandatory payrolling from 6 April 2028. From the same date, employers will be able to opt to payroll taxable

Pension contributions benefit from tax relief. However, the amount of the relief is capped at the lower of 100% of earnings (or £3,600 where this is higher) and the available annual allowance. Annual allowance The annual allowance is set at £60,000 for 2026/27. However, it is reduced where both adjusted net income exceeds £260,000 and threshold income (broadly income excluding pension contributions) exceeds £200,000, by £1 for every £2 by which adjusted net income exceeds £26

The approved mileage allowance payments (AMAP) system allows employers to make tax-free mileage allowance payments to employees who use their own vehicles for work. The payment is tax-free as long as it does not exceed the ‘approved amount’. This is the number of business miles in the tax year multiplied by the approved rate for the vehicle in question. Different rates are set for cars and vans, motorcycles and cycles. Additionally, for cars and vans there are two rates – a h

Where a taxpayer has been made bankrupt, their Unique Taxpayer Reference (UTR) expires at the end of the tax year in which they were made bankrupt. They cannot use that UTR to file Self-Assessment tax returns for later tax years. Instead, they must re-register for Self-Assessment and obtain a new UTR if they continue to trade after the tax year in which they were made bankrupt or if they need to complete a Self-Assessment tax return for any reason after that tax year. The old

A taxpayer may need to contact HMRC if they have a query about their tax affairs. There are various ways in which this can be done. HMRC’s digital assistant Taxpayers can ask HMRC’s digital assistant for help by visiting the Gov.uk website at www.tax.service.gov.uk/ask-hmrc/chat/self-assessment. If the digital assistant is unable to answer the question, the taxpayer can ask to be transferred to a webchat with an HMRC advisor if they are available. X HMRC will answer queries v

On 21 May 2026, the Chancellor announced a temporary reduction in the rate of VAT applied to children’s meals and admission to certain attractions. It does not apply to sporting activities. The measure is intended to help families over the summer holiday period. Children’s meals and tickets to attractions currently are liable for VAT at the standard rate of 20%. However, from 25 June 2026 to 1 September 2026 inclusive, a temporary reduced rate of 5% will apply to qualifying c

Taxpayers within Self-Assessment must make payments on account towards their next tax and Class 4 National Insurance bill if the tax that they owed for the previous tax year was £1,000 or more, unless they paid more than 80% of the tax that they owed for that year outside Self-Assessment, for example, under PAYE. Each payment on account is 50% of the tax and Class 4 National Insurance liability for the previous tax year. The payments must be made by 31 January in the tax year

HMRC use a range of communication methods, as do fraudsters. Consequently, it can be difficult to be certain that a call, email, letter or text which seems to come from HMRC actually does. How then do you tell if the communication is genuine? Phone calls Scammers may pretend that they are from HMRC and try to extract a person’s bank details by telling them that they are entitled to a tax refund. This should set warning bells ringing – HMRC will never phone someone to tell the

Landlords running an unincorporated property business obtain relief for interest and finance costs incurred in relation to residential lets (including holiday lets) as a tax reduction. The tax reduction is 20% of the lower of the: · interest and finance costs; · the profits of the property business for the tax year (after any brought forward losses); and · adjusted total income (income after losses and reliefs that exceeds the personal allowance). The deduction cannot create

The cash basis is the default basis of accounts preparation for landlords with annual rental income of £150,000 or less running unincorporated property businesses. Under the cash basis, income is only recognised when received and expenses are only recognised when paid; there is no need to account for debtors and creditors or prepayments and accruals. Simpler rules also apply to capital expenditure. Under the accruals basis, expenses can only be deducted in calculating taxable

A landlord will need to consider whether it is better to pass on an investment property during their lifetime or on their death. Here, we look at the associated tax implications. On death Where a landlord dies, any investment properties that they have will form part of their estate at death and, unless they are sheltered by the nil rate band, inheritance tax (IHT) will be payable at the rate of 40%. However, there will be no capital gains tax to pay. The property benefits fro

In the last few months, some taxpayers who possibly have had no dealings with HMRC previously have been receiving letters headed ‘Simple Assessment’. The letters are being sent to those taxpayers whose outstanding tax liabilities cannot be collected automatically through the Pay As You Earn (PAYE) system or who do not complete a self-assessment tax return. A simple assessment is issued when HMRC already holds sufficient information to calculate a taxpayer’s liability, but can