Author Archives: Alison Tutt

Pre April tax planning is a useful and potentially tax efficient way to review your financial situation and take advantage of any opportunities that may arise before 5 April.

Tax Planning: A Pre-April Tax Health Check

Posted on 6th March 2015

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February and March can be busy and useful months in the world of a tax compliance worker as we look to tax planning opportunities that can be fulfilled before the start of the new tax year.

Pre April tax planning is a useful and potentially tax efficient way to review your financial situation. Due to the anomalies of the tax system if your income falls into one of the following bands below then you can be caught by unusually high rates of tax. Taking simple action to reduce the amount of income falling into those bands can therefore be particularly tax efficient:

Income just exceeding the Basic rate band (£41,865)
Income falling between £50,000 and £60,000 for the clawback of child benefit
Income over £100,000 – a reduction in personal allowances and potentially paying up to a 60% tax charge on income over this limit

Examples of the actions that can be taken are:

Making personal pension contributions
Gifting monies to charity under gift aid
Making tax efficient investments such as EIS (30% tax reducer) /SEIS (50% tax reducer)

If you are reviewing your finances at this time of year, other matters to consider as well could be:

Start saving money tax free in an ISA (currently up to £15,000 cash for 2014/15)
IHT gifts of up to £3,000 per annum
Using the capital gains tax annual exemption of £10,900 per annum

If you would like to discuss any of the points raised above, please do not hesitate to contact a member of our tax team.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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Many people are now aware of the dangers of unsolicited emails; however, with the increasingly realistic and often feasible examples being dreamt up by cyber fraudsters it is certainly getting harder to tell the difference

Claim your Tax Refund Online! Just enter your bank details …. [Phishing]

Alison Tutt - ahayden@goodmanjones.com

Posted on 12th November 2014

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Unfortunately scam phishing emails are on the increase again, with a reported 74,743 scam emails referred by taxpayers to HM Revenue & Custom’s (HMRC’s) dedicated phishing email account in the last 6 months – a significant increase on the same period in 2013.

Many people are now aware of the dangers of unsolicited emails; however, with the increasingly realistic and often feasible examples being dreamt up by cyber fraudsters it is certainly getting harder to tell the difference. Below is a recent example of the detail and design of these emails – the colours and typeface are startlingly similar to HMRC’s actual website.

By clicking on the link and ‘claiming your tax refund’ you will be directed to a fake website and encouraged to enter your personal bank details.

Please remember that HMRC will NEVER contact you by email regarding a tax refund but will always send a letter by post. If you receive one of these emails please forward it onto phishing@hmrc.gsi.gov.uk before deleting it.

Phishing emails account for billions of pounds worth of fraud every year. To help stay safe online you can visit www.getsafeonline.co.uk

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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Do you have a temporary workplace? [Employee travel expenses]

Alison Tutt - ahayden@goodmanjones.com

Posted on 22nd August 2014

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Whilst dealing with a recent tax return case I was reminded of an opportunity for employees to claim a tax break relating to travel expenses which many people are not aware of. Most people are aware that ordinary commuting is not a tax allowable expense, but travel in the performance of duties is tax deductible. However, there is a further scenario whereby employee travel expenses can be claimed as tax deductible.

This scenario relates to employees engaged at a temporary workplace which is broadly defined as a workplace an employee is sent to for a period of less than 24 months. In these circumstances, employees can claim not only travel expenses in the performance of their duties but also travel expenses of getting to and from the temporary workplace which would in normal circumstances be considered non allowable commuting.

There are some exceptions, for example if your work is limited to a specific geographical area, for example an area manager, then this area becomes your permanent workplace.

It is therefore worth remembering that if you fall into the temporary workplace category you may be entitled to claim tax relief on travel expenses and apply for a refund, within certain time limits. If you require any further information then please do get in touch.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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PAYE Coding Notices – Checking the Chaos

Alison Tutt - ahayden@goodmanjones.com

Posted on 26th February 2014

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Many people do not realise the importance of checking PAYE coding notices; however you could be paying too much tax if your tax code is wrong.

At this time of year HMRC start issuing PAYE coding notices for the coming year. These are based on the recent 12-13 tax return submissions. If your circumstances or income have changed since then it is likely that the tax return will be inaccurate.

To help tax payers get their tax codes corrected HMRC has recently introduced a new email service which you can use to let them know that your PAYE code is wrong. This could save you a lot of time trying to contact them by phone.

Introduced into post war society, Pay As You Earn has led to employers acting as a tax collector for income tax, national insurance and even student loans. Bearing in mind the effect a tax code can have on an individual’s earnings, the importance of checking these is paramount – especially after the problems HMRC had back in 2010 with their PAYE computer systems and the ensuing mess that has followed for several years. As agents we no longer automatically receive PAYE coding notices from HMRC and we are therefore relying on well informed clients to forward these on to us to check.

Some of the more common adjustments you might find in a PAYE code are as follows: –

Car/Fuel Benefit
Medical Insurance
Child Benefit
Outstanding HMRC debts
State Pension
Gift Aid Relief
Pension Relief

For higher earners there are further problems. If you earn over £100k you will start to lose your personal allowances by £1 for every £2 of adjusted net income over the income limit. Therefore if your earnings hover around this threshold, or your salary fluctuates year on year, you may find that the allowances in your PAYE code fluctuate too. This could lead to a nasty shock at the end of the tax year, if you find out you have underpaid tax.

With the seemingly limitless amount of restrictions that can be included in tax codes it is imperative that these are checked by either the taxpayer or an agent. If you believe your PAYE code may be incorrect, or you require further information, please do not hesitate to contact one of the team here at Goodman Jones.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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High Income Child Benefit Charge

Alison Tutt - ahayden@goodmanjones.com

Posted on 30th October 2013

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Over the last month, HM Revenue and Customs (HMRC) have been writing to higher rate taxpayers to remind them that if their income is over £50,000 and they or their partner received Child Benefit in 2012/13 they will need to complete a tax return for the 2012/13 year. With the 31 January 2014 deadline looming we are all now becoming acutely aware of the problems and pitfalls in reporting Child Benefit.

The High Income Child Benefit Charge (HICBC) starts to kick in on income over £50,000 and it effectively ‘claws back’ 1% of the child benefit for every 100 your income exceeds this threshold. So if you earn over £60,000 the charge becomes equal to the amount of child benefit received. The charge is disclosed on your self assessment tax return – which means anyone not issued with a return had to register by 5 October this year. The option to opt out of receiving child benefit was available however many inevitably missed this deadline and now find themselves caught in the cycle of self assessment.

This has been a popular issue for commentators since its introduction on 7 January 2013, with many describing the unfairness with the example of a couple both earning £49,950 keeping their Child Benefit, whilst a single earner on £50,500 starting to lose it.

However, it is not just the monetary charge itself that is causing issues; there are also more practical concerns to consider:

Because the child benefit charge needs to be declared on the tax return of the higher earner, the ethos of ‘self-assessment’ comes into question. For couples who do not readily share their financial details there is a problem in accurately completing their tax returns. This will be particularly noticeable if the income of one partner fluctuates year on year.

HMRC defines a ‘partner’ as a person you are married to and living with or a person you are living with as if you are married. Therefore, you may be liable to the child benefit charge for a child who is not your own.
After weighing up all the facts you may just decide to cancel the payments to avoid the extra administrative burden. However even in this scenario there are consequences. If you cancel your child benefit payments but your partner does not work they could lose their entitlement to state pension benefits.

If there are any issues above that you wish to discuss further, please do not hesitate to contact one of the tax team at Goodman Jones.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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