June 30, 2012

Get creative and save tax

Under the new proposals first put forward at the Budget 2012, the government is set to back the creative sector with world leading generous tax reliefs similar to the Film Tax Relief which has led to high levels of investment in British Cinema.

The announcement in the Budget to introduce tax relief for the creative sector from April 2013 can only be good news.  According to the Treasury “the aim is to support technological innovation and ensure creative industries contribute to British growth and culture.”

The plan currently under consultation by the Treasury is to introduce Corporation Tax reliefs to those in production of animation, high-end TV and video games. We have been here before though and with every change of government there seem to be tax changes that never go beyond the next election. This has driven creative industries to seek warmer climes and better tax reliefs.

What the creative industry now needs is some continuity and stability. So if you work in animation, high-end TV or video games and wish to have a say on the new proposed tax reliefs then why not attend the Government’s stakeholder meeting Tuesday July 10 2012 at HM Treasury, 1 Horse Guards Road, London, SW1A 2HQ. If you wish to attend, email creativesectortaxreliefsconsultation@hmtreasury.gsi.gov.uk by Wednesday 4 July.

Important - we endeavour to keep the information on this Site and the Blog accurate and up-to-date as far as possible. However, please remember the content is intended as a helpful guide only and may be subject to change at any time. Please always seek advice from your accountant or Davis Burton Sellek before acting on any of the information provided.



June 10, 2012

Euro 2012 or reflect on your tax affairs?

With Euro 2012 already dogged by racism and Germany winning on Saturday, we all know it will end in tears for Roy Hodgson’s England. However, closer to home we will be supporting the Camberley Youth Football Club Boys Tournament on 16 and 17 June. Davis Burton Sellek are proud to sponsor the U15 Rebels – spot the Davis Burton Sellek branded football strips and hoodies!

If neither football nor the Olympics are your thing then taking a moment this summer to review your tax affairs with your accountant is important. Take time out from the daily grind to review your tax matters – doing so sooner rather than later could you save money in the long run.

Here are some useful pointers to raise with your accountant this summer:

  • From 2013/14 those (born on or before 5 April 1948) facing the age-related personal allowance freeze should seek advice on how to get the most out of their allowance
  • Anyone earning over £100,000 faced with the withdrawal of the personal allowance 2012/13 will require a robust financial planning strategy in place
  • From next April the additional rate of income tax for those earning £150,000 is set to fall from 50% to 45%. Giving careful consideration to the timing and structure of your income could significantly reduce your tax bill
  • Seek advice from your Financial Planner on maximsing pension contributions (within limits) during 2012/13
  • If your spouse or partner has little or no income you may wish to transfer income to them ensuring they make full use of their personal allowance. This may prove useful in light of the Child Tax benefit changes
  • Similarly, look at ways to reduce the overall combined tax bill if one is paying at a higher rate
  • Delaying incurring expenditure may not be the most tax-efficient option for business owners. Further falls in the main rate of Corporation tax (now 24%) may provide a higher rate of relief
  • Spare cash for investing?  A new Seed Enterprise Investment Scheme (SEIS) offers income tax relief of 50% for individuals who invest in shares in qualifying companies
  • Talk to your accountant about tax-efficient giving and make the most of tax reliefs. Thankfully, the Government’s proposed cap on income tax relief is no longer going ahead!

So arrange a review meeting with your accountant and financial planner this summer and make sure your tax affairs are in order. It’s a much safer bet than England winning Euro 2012!

Important - we endeavour to keep the information on this Site and the Blog accurate and up-to-date as far as possible. However, please remember the content is intended as a helpful guide only and may be subject to change at any time. Please always seek advice from your accountant or Davis Burton Sellek before acting on any of the information provided.



June 6, 2012

Looking to sell then plan ahead

We so often see business owners passionate about what they do but so bogged down with the day to day running and their own personal lives that they lack time (quite understandably) to plan for the day they come to sell. This may mean the business is worth much less once the current owner retires or dies.

Simple things like a share based incentive scheme for those business owners who employ staff can greatly increase the value as shareholdings can be linked to company and personal performance. Shares can be gifted to children during lifetime or on death and shares in an ongoing company can qualify for tax reliefs that reduce corporation tax. Equally, if the owner decides to liquidate the business then planning for things like Inheritance tax is a must.

Either way a medium to long term strategy with guidance from your accountant will ensure your business is worth as much as it can be when you come to sell.

Are you ahead of the game or just living each day? Talk to your accountant for guidance and support before you come to sell.

Thinking of selling in a few years then contact mark.busby@dbsellek.co.uk or 01344 620495 on what you need to do to secure the best value for you and your family.

Important - we endeavour to keep the information on this Site and the Blog accurate and up-to-date as far as possible. However, please remember the content is intended as a helpful guide only and may be subject to change at any time. Please always seek advice from your accountant or Davis Burton Sellek before acting on any of the information provided.



October 28, 2011

Save tax: purchase big-ticket items before capital allowance reductions next April

If you’re thinking of buying a big ticket item like a commercial vehicle, capital equipment or similar then it pays to act now. Since next April the Government is cutting the annual capital allowance benefit known as the Annual Investment Allowance from £100,000 to £25,000 per annum.

How businesses can benefit from capital allowances in a nutshell

Businesses in the UK are entitled to claim capital allowances to reduce Corporation or Income tax on profits. Whether a Sole trader, Partnership or Limited company, if you’re planning on buying capital equipment that will last longer than a year then if you act now (before your accounting year end) you could reduce your overall tax bill.

What are capital allowances and how do they work?

Capital allowances permit businesses to write off the cost of capital assets such as plant and machinery, against taxable income. They take the place of commercial depreciation, which is not allowed for tax purposes.

Currently, business owners can spend up to £100,000 per annum on new assets for their business and reduce their taxable profits by this amount on most plant or machinery. This capital allowance is known as the Annual Investment Allowance (AIA).

Moving forward, claiming the AIA will become more difficult. The reduction in capital allowance is effective from 6 April 2012 for sole traders & partners and 1 April 2012 for Limited companies.

Which purchases can’t I claim capital allowance for?

  • Cars
  • Assets your business buys before the last accounting period before it stops trading
  • Assets introduced into the business from another business
  • Personal assets introduced into the business that you already owned e.g. office chair
  • Assets given to your business

What personal tax benefits come with the Annual Investment Allowance?

Apart from reducing the amount of tax payable (by up to 50% for additional rate taxpayers), an AIA claim can help protect the personal allowance of a business owner earning in excess of £100,000 in that initial year or purchase.

Important - we endeavour to keep the information on this Site and the Blog accurate and up-to-date as far as possible. However, please remember the content is intended as a helpful guide only and may be subject to change at any time. Please always seek advice from your accountant or Davis Burton Sellek before acting on any of the information provided.



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