Tax Questions

Tax questions Carmarthen Journal 17th October 2012

I have recently received details about RTI (Real Time Information) for my PAYE scheme for the employees I have. What do I need to do?

In their drive to obtain up to date information on employees, HMRC will be introducing a system known as RTI which in its simpliest form will force employers to inform them on a regular basis what their Tax and National Insurance contributions should be. You will need to send that information to HMRC electronically on or before you make any payments to your employees. This will mean that year end forms P35 and P14’s will not be needed and if any employees move jobs or have more than one, they will get taxed the right amount. It has also been introduced to help with the new Universal Tax Credit which is set to be introduced in the future.

We have an innovative idea but it is going to take a while to develop. How can you help us with the tax side of things?

The Government is very keen to help companies who invest in research and development (R&D). Subject to certain criteria, companies can obtain tax relief on the costs they incur on their R&D. In fact you can obtain tax relief of 225% of the costs you incur, so for example if you spend £10,000 on development then you can actually have relief on £22,500. In addition, if you have not started to trade or are not yet making a profit, you can claim a cash payment instead. There is also a new initiative called the ‘Patent Box’ which again subject to certain rules, may reduce your rate of corporation tax from 20% to 10%. These reliefs are really exciting but they can come with complex rules and I would suggest you get specific tax advice on your particular idea.

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