Archived News June, 2010

Tax questions Carmarthen Journal 16th June 2010

I will be 65 in two years time, but I don’t know whether I will receive the full state pension, as I haven’t always worked in the past. How can I find out what I will receive when I become a pensioner and is there any way to supplement any shortfall?

The amount of qualifying years you need to enable you to claim a full basic state pension has recently changed. The number of years has been reduced to 30 and applies to both men and women. To establish what state pension you are likely to receive, you will need to contact the Pension Service via the website http://www.thepensionservice.gov.uk or telephone 0845 3000168. They will then provide a state pension forecast and from this you can identified whether or not you have a shortfall from the 30 years. Firstly, check that the information on the forecast is correct. Then if there is a shortfall you can pay Voluntary National Insurance Contributions to cover the last 6 years at a rate of £626.40 per year (currently rates). Alternatively, if you have been self-employed your may be able to pay Class 2 contributions (£2.40/week) if you’ve previously claimed an exemption. Further information on what is eligible as a qualifying year can be found on the Government website http://www.direct.gov.uk

We own a couple of properties and hold a share portfolio worth about £150,000. We are worried about what the new Government will do in relation to the capital gains tax rates and were thinking of selling the portfolio and transferring the properties to some of our family members so that we can be certain of the tax rates. Does this seem sensible?

Clearly, I am unable to tell you what is going to be in the next budget or when those changes are likely to be enacted. It is possible that CGT rates could be increased and tax-free allowances be reduced and the only way to guarantee your tax liability would be to look at some of those things you mention. If however, you are holding those assets for the long term is it really necessary to pay the tax when you do not really need to dispose of them at the moment?

Please don’t forget that the new coalitions’ emergency budget will be held on 22nd June 2010.

Full details can be found on our website: http://www.lhphillips.com

Tax expert Carmarthenshire Journal 15th June 2011

I am director of a small company that started just over 12 months ago. To try and gain new clients and entertain existing ones, I joined Carmarthen Golf Club. As the company has paid my subscription to the club, my accountant said that I be taxed personally with a ‘benefit in kind’. What does that mean and is he right?

A benefit in kind is a benefit you receive from the company which is of monies worth. Company cars, private medical insurance and unfortunately, golf club subscriptions come under this category. The company is paying for something that is not completely necessary for you to run your business, even though you gain new clients from the subscription. Therefore, your accountant is correct and you will need to complete forms P11D and P11D(b) by the 6th July. The level of tax due on your subscriptions will depend on whether you are a basic rate or higher rate tax payer and it should be deducted from your monthly pay or included in your self assessment tax return.

I have had a notice included in my VAT return to say that I have to submit my return ‘electronically’ from 1 April 2012. HELP! What do I need to do?

You are quite right, HMRC have just announced that all businesses that are VAT registered will have to submit and pay their VAT electronically. That means VAT returns have to be submitted via the internet and payments have to be made either by direct debit, card payment over the internet, telephone banking or by CHAPS payment. To facilitate this HMRC have set up a beginners guide to VAT online: http://www.hmrc.gov.uk/vat/sign-up-for-online.pdf alter,natively you may want to use your advisor for assistance.

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