Hornbeam Highlights 33
Making the most of your Accountant
On the reverse is a list of situations in which we may be able to help you save money. Please keep it safe. We suggest you create a folder for Hornbeam Highlights and enclosures. This list has been prompted by a number of situations which have arisen recently…
On 11 November we delivered a lecture to Breckland District Council landlords forum on tax saving ideas for landlords. On the day after we wrote the text a long established client brought in her records for her tax return. These included the sale of an investment property. Although the capital gains tax was only about £4,000 we could have reduced this to just over zero had we been consulted before the sale. We would have done this by getting her to complete a deed of variation in favour of her husband so that they could take advantage of two sets of annual exemption at £9,200 each, at 40% for 2008. This is one of the tax saving measures that we promoted in our lecture! It is, of course, deeply frustrating for us to have the skills to save clients money, but be unable to help because we are not consulted until after the event.
Several of the suggestions in our lecture stemmed from past experience. For example, a new client came to us having just spent 10 weeks in Manchester restoring a property which was to be occupied in part by his student daughter, and in part let to other students. We explained that; had we been aware of the situation before he spent 10 weeks living in the property, we would have advised him to nominate the property as his primary residence, then nominated back to his Norfolk home when he finished, for two letters he would probably have wiped out 6 years of capital gains on the property. Fortunately he was able to take advantage of this advice with a subsequent property.
Several clients have come to us for advice on avoiding capital gains on residential investment properties; to date only one has chosen to move into the property for a period in order to substantially reduce the tax.
We have a strategy in place to halve stamp duty on more expensive properties, but we must know before you buy/sell the property.
We can help you save substantial tax when setting up a company,
We have for example been able to enable clients to extract as much as £100,000 from a company tax free (normally payroll taxes or higher rate taxes on dividends would have cost £25,000) |
when growing a company
We have recently helped an established client set up a new profitable business that will pay no tax for 5 years, because of the way we have set it up. |
when paying bonuses
We have set up two different systems whereby bonuses can be paid to executives free of tax in the past twelve months. |
when closing down a company,
We have recently enabled a client to extract over £1,000,000 from a redundant Limited company for less than £100,000 tax when a dividend or bonus would have cost over £250,000. |
So please read the list and make the most of your Accountant…
DisclaimerMost of the information contained in this Hornbeam Highlights is of necessity greatly oversimplified. We are trying to bring to your attention tax planning and business management opportunities. However, you should not take action based upon this leaflet without obtaining specific professional advice.
Whether you are a client or not, if we can provide further help or advice concerning any of the matters covered here, please do not hesitate to contact us
Property and investments
- Buying or selling commercial property
- Refurbishing, extending or improving commercial property
- Buying or selling investment property
- Buying or selling a home
- Buying or selling other assets
- Other major investment
- Remortgaging
- Thinking of changing bank
- Thinking of borrowing
- Thinking of leasing or some other form of asset finance
- Other forms of refinancing
- Launching a major new product, service or division
- Setting up a new business
- Buying a business
- Setting up a Limited Company
- Turning your business into a Limited Company
- Unhappy with your sales and/or profits
- Unhappy with your cash flow
- Unhappy with your personal tax bills
- Paying key people over and above their standard salary
- Making additional payments to the owners
- Appointing a new Director
- Parting company with an existing Director
- Changing Director's service agreements
- Employing a family member
- Taking on a "sub-contractor"
- Setting up a profit sharing scheme
- The business buying assets for the personal use of the owners/employees
- Buying or leasing a car
- Using a car for business
- Major changes to what the business does
- Changing shareholders/partners
- Changing business structure
- Changing shareholder/partnership agreements
- Transferring or selling shares
- Issuing new shares
- Selling all or part of your business
- Thinking about retiring
- Setting up or changing pension arrangements
- Changing accounting system
- Receiving correspondence from the tax authorities
- Exceeding the VAT threshold
- Being notified of a VAT or PAYE visit
- Changing your VAT arrangements
- Appointing consultants or other professional advisers
- Exporting or importing
- Winning a major new contract or customer
- Writing a will
- Suspecting that you may receive an inheritance at some time in the future
- Getting married or divorced
- Births and deaths
- Moving abroad
- Making large gifts to family and friends
- Receiving a large windfall such as a lottery win
- Other major changes in your personal circumstances
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