1. Own your own car Rather than using your employer’s. The tax payable on car benefits is now so high, it is often cheaper to own your own car and use it for your employer’s business.
2. If you use your own car ffor business claim back the full entitlement which is 45p per mile for the first 10,000 miles, thereafter 25p per mile. I your employer reimburses less, you can claim the difference in your tax return.
Running Your Own Business
3. If you borrow money to buy shares in a private company or a share in a partnership, you should be able to get tax relief on the interest at your top rate of tax.
4. If you are registered for VAT hen consider the use of the flat rate scheme. The payment due to the Inland Revenue is a percentage of your standard rated turnover. This means that you don’t have to calculate VAT every quarter. Your turnover must be less than £150,000.
Those On Low Income
5.If you provide foster care to children, the first £10,000 plus £200 per week for each child under 11 (£250 for over 11) is tax free. If the amounts exceed these limits you can choose between paying tax on the excess or on the gross receipts less expenses.
6. Claim tax back on interest you receive. You can register to receive interest gross by filling out Form R85 from the bank/buiding society. If the account is in joint names and only one I eligible, then the interest received is 50% of the gross.
7. If one half of a couple is paying tax at the higher rate then they should try and equalise their income. This would mean that you could employ them in their businesses. Alternatively, if they can demonstrate that one half plays a significant part in the business, they could make them a partner then profits can be shared.
8. Pay your spouse to work in the business. This is a deductible expense.Be aware of the minimum wage.
9.You can receive rents of up to £4,250 tax free per year for letting furnished rooms in your home. It only applies to the main home. If jointly owned then this is split.
10. If a husband and wife own a property in joint names(loint tenancy), the income and expenditure is divided eqally. If the ownership is owned as tenants in common and you ask for Form 17, you can jointly declare the ownership split tht actually applies.