0 What you need to know about VAT – Part 1

VAT – An Overview

What is VAT?

 VAT is an amount charged on most goods and services that are purchased in the UK and equivalent in Europe. A business registered for VAT will charge it on to other business and consumers in the UK. The good thing is that VAT registered business are able to recharge the amount of VAT that has been charged to them. The bad thing is that non-vat registered business and consumers are not able to claim back the VAT.  Effectively it is a sale of good tax to consumers.

• Currently in the UK, there are three rates of VAT and an exemption rate:
• Standard rate VAT – is the one we know – at 20%
• Reduced rate VAT – mainly utilities – at 5%
• Zero rate VAT – being 0%

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0 Tax Relief for Childcare

Let’s set the scene. You have children under 16 and they take time away from your business day with having to keep them “entertained/occupied” and dealing with their day to day needs. The time you spend with them means less time working which helps with the care of your children.  So what do you do?  I know, you can get a nanny, au pair, put them in after school clubs and get other people to do as much as possible so giving you back your time.  (You can tell I don’t have children.)

Of course these costs must be tax allowable because if you don’t have childcare provision, then you can’t work so much, and if you can’t work so much then you are not earning the money to pay tax to the government? Aren’t they?

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0 Should You Be Claiming the Use of Home as Office?

This subject seems to be one that many clients ask. Self-employed people mainly base their work place at home although work may take place at customer locations. This can be many trades & professions from plumbers, accountants, chiropractors, computer technicians etc. It also covers freelance musicians, actors and other performers.

As you visit customer sites, it would be reasonable to be able to charge to your business the cost of getting to the customer locations. But, there is a little bit of an issue if when you walk in after being at customer locations, your trading activity stops as you get home.  If no work was done at home, it implies that home is not the true base of your business. You need to make sure that business happens in the home such as writing up proposals, quotations, invoices, research etc.

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