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In the UK, we are in the fortunate position where most people earning a PAYE salary or wage or receiving a pension do not need to complete a tax return.
However, each year, as working and lifestyle patterns change, the number of tax returns increases. More than 11,500,000 were filed for the 2016-17 tax year.
For the 2017-18 that ran from 6th April 2017 to 5th April 2018 tax year, if any of the following apply to you, a tax return is required:
In some circumstances, you would need to submit a tax return to claim a tax rebate from HMRC. For instance, on:
If you have not completed a tax return before, for all except sole traders and partnerships, register online with HMRC at: https://online.hmrc.gov.uk/shortforms/form/SA1
For a new sole trader, register with HMRC at: https://online.hmrc.gov.uk/registration/newbusiness
For a new partner, register with HMRC at:
https://public-online.hmrc.gov.uk/lc/content/xfaforms/profiles/forms.html?contentRoot=repository:///Applications/SA_iForms/1.0/SA401_20167&template=SA401_en_1.0.xdp
If you are the ‘nominated partner’, you need to register both yourself and the business partnership at:
https://online.hmrc.gov.uk/registration/newbusiness
HMRC target to post your Unique Taxpayer Reference that enables you submit a tax return within two weeks of registration.
With this you can either prepare and file a paper tax return before the deadline of 31st October 2018, enrol for the HMRC online service that grants a longer deadline of 31st January 2019 or appoint a tax advisor to act as your Agent.
To appoint CooperFaure, we would need is your Unique Tax Reference, National Insurance Number and Post Code to act on your behalf.
If you would like to arrange an initial free consultation to discuss your tax affairs or would like any further information, please email us at tax@cooperfaure.co.uk
A project may qualify for R&D tax relief if it has a result that creates a breakthrough in knowledge or competence within your field. Additionally, this may also be the case if work is carried out to resolve an uncertainty.
Developing a new product is not sufficient enough to qualify. The key is the advancement achieved to the field as a whole and not solely to your own company. Therefore, an important condition that must be met is that the answer is not already common knowledge and that it cannot easily be resolved by a professional.
It can be anything from software development to a new internal process within your company.
How to show that your project qualifies for R&D tax relief
One of the key inquiries HMRC will be questioning is, has there been a technological or scientific advancement. Therefore, it is vital to establish exactly what the research and the development you have or will carry out has achieved and not just the end product. What specific details within the project has produced an advancement?
For example, developing an app for your company will require research and development in order to produce this app. But this is not sufficient enough to qualify. However, if you develop a new feature within the app that has not been produced before it may qualify.
The next question is regarding uncertainty, and this also refers to technological and scientific uncertainties. What have you faced and overcome during the projects timeline? Uncertainty that can be resolved via brief discussions internally or resolved easily by a professional within the field does not qualify. There is a requirement to be proof that it has not been done before and cannot not be easily worked out.
The processes and procedures used throughout the project needs to be explained in detail in order for HMRC to establish if the two questions above have been answered. The language used needs to be comprehensible and not only clear for a professional within the field. Elaborate further with evidence what has been done within the filed and not solely just your own company. Be sure to include what success and failures other professionals have had to prove that the answer is not readily available. If there is not sufficient information available publicly, proof of background, experience and knowledge along with a detail explanation of your case would be required.
The project or product developed does not need to be successful in order to receive R&D tax relief. This is because the focus is on the advancement made and the work carried out to resolve the uncertainties. Additionally, the uncertainty itself is not required to be worked out. So long as it can be demonstrated that the goal was a technological advance, even if the project ends in failure, it would still qualify for the relief.
The costs that qualify for R&D tax relief
The tax relief that is provided is directly linked to the costs incurred to achieve the advancement and the work required to overcome the uncertainty. For example, qualifying costs include staff costs, external staff, costs of materials and resources used, software used and prototypes etc. The key is that the costs have to be directly related to the R&D work carried out. If not 100% of the cost is used for the project then a reasonable proportion needs to allocated.
Therefore, we would recommend to keep a record of all work carried out directly related to the project and the associated costs.
To further assist you with establishing if your company is eligible for R&D tax relief, answer our 6 simple questions.
If you would like to arrange an initial consultation that is free and without obligation to discuss your circumstances, please email us at tax@cooperfaure.co.uk.
Dispatching goods within the European Union (“EU”) is relatively straightforward as the EU operates under a single market which guarantees four key freedoms across the twenty-eight members states. These are the free movement of goods, capital, services and persons.
Whilst the Brexit negotiations are far from concluded, it seems that the UK government is looking for an arrangement that will allow the free movement of goods to continue. In any event, the current rules are set to remain until the end of the transition period.
In practical terms, this means most shipments can be dispatched to other member states of the EU without special customs documentation. There are exceptions, such as sales to international organisations which would be treated as exports, and exclusions such as goods subject to export licensing controls, such as military hardware, and goods classed as excise products, such alcohol, tobacco and hydrocarbon oils.
Goods in movement within the EU are termed as being dispatched upon leaving the state of origin of the goods, and as arrivals when entering the member state acquiring them rather than exports and imports.
Goods dispatched within the EU between VAT-registered businesses are not subject to VAT. This also applies to goods imported into the EU that have been released for free circulation following payment of import duties.
However, goods dispatched to a customer in another EU country who is not registered for VAT in that country and where the seller is responsible for delivery, are treated as ‘distance sales’. This is the case for mail order or internet sales to private consumers in another EU country.
For distance sales, VAT is charged UK rates in the normal way. However, each member state has a ‘distance selling threshold’ and if the value of sales to that country exceeds this limit, the seller must register for VAT in that country, and charge their rate of VAT or the equivalent tax on sales to that country. The current thresholds can be found here.
Customs declarations are not generally required for goods shipped within the EU but traders must raise VAT invoices and retain evidence of shipment.
Every business trading within the EU must declare these sales on its VAT return. If the sales of goods exceed the applicable exemption threshold during a calendar year, the business must also submit Intrastat returns each month.
The Intrastat thresholds are reviewed annually and are currently £1.5 million for Arrivals and £250,000 for Dispatches.
Whilst the levels remain below these thresholds, the trader is only required to declare the value of Dispatches and Arrivals on the normal VAT return.
Once these thresholds are exceeded, there is a requirement to submit additional monthly declarations to HMRC.
The EU has a trade agreement in place with the European Free Trade Association (EFTA) member states of Iceland, Liechtenstein, Norway and Switzerland which broadly applies the same terms for the free movement of goods.
The EU principle of ‘free circulation’ covers not only goods produced in the EU but also goods imported from outside the EU once all import formalities have been completed and import duty and any other customs charges paid.
Free circulation goods can then move within the EU and EFTA states without duty with the exception of goods that require a licence or carry an excise duty.
If you have any concerns of would like any further information, please contact us at tax@cooperfaure.co.uk