PAYING TAX MADE MORE FUN – EPISODE 3 – THE GRAND FINALE

So you have a tax bill due at the end of the month.

You don’t want to pay it because you need the money, or just want to keep it back for something more useful than (urgh) tax. ?

You don’t want to pay HMRC by installments because –

• You don’t want to owe them money
• You don’t like HMRC
• You don’t like the fact that one missed payment means the whole amount is payable
• Interest on the installments isn’t tax-deductible .

Well ….. I have another option for you ?

There are finance companies who will lend money to enable tax payments to be made, and you pay them back over 12 months.

It’s a bit like financing a car, but not as nice.

This loan interest is tax-deductible.
You’re borrowing from humans, who will talk to you like an adult if there’s a problem.
If you miss a payment HMRC won’t label you as a ‘bad payer’.
It’s an opportunity to form a business relationship for the future with the finance company.
You don’t owe money to HMRC.

Would you like to meet a broker who can arrange this?

Have you enjoyed this series?

Do you think tax payments are more fun now? ??

EPISODE TWO – REDUCING THE TAX PAYMENT ???

If you have a tax bill to pay at the end of January ………

Stop ✋ Before you pay it !!

You might be able to send less money to HMRC ?.

Why? ?

Part of the tax payment will be an estimate of your tax bill for the first year of the pandemic, starting a couple of weeks into the first lockdown.

It will be an estimate based on the 12 months BEFORE the first lockdown (give or take a few days).

If your profits fell in the pandemic the estimate will be TOO HIGH!

If you don’t do anything, you will pay too much tax, then have to get it back later.

But….

You can apply to reduce the estimate to a more realistic payment and settle up later with HMRC when you can tell them the true figure.

This means …….

Better cash flow ?

More money to help the business survive, develop or spend on having a good time ?

No waiting for HMRC to pay you back ?

Being able to show off to your mates ☺️

Would you like to keep more of your money?

Would you prefer not to make a loan to HMRC, and then have to get it back?

Are you excited about episode 3? ?

In normal times we have regular January traditions –

• Comparing Christmas experiences
• Joining the gym
• Dieting
• Being skint
• Dry January

  And the best of all ……

  The January 31 tax payment – lovingly waiting for you after Christmas, and this year it’s perfectly timed after 10 months of Covid.

  Not only that, but the July 31 2020 tax payment was postponed until the end of January 2021 as well. ??

  So that’s even more money to find ?

  What if you can’t pay it or want to use the money for something else, perhaps something frivolous like food

  Well …..this year…… for the first time …. if you owe no more than £30K, your tax returns are filed up to date, and you don’t owe any other tax, you can apply online to pay over 12 months.

  You can even select the level of payments.

  Another example of HMRC creeping slowly into the 21 st century. They hope to all have emails one day as well. (seriously)

  Next time I will reveal how to possibly reduce those pesky tax payments. Bet you can’t wait ?

  Do you want to pay your tax over 12 months?

  Do you actually know your tax bill?

Craig (not his real name) started his own business 18 months ago.

I did his tax return last year, getting him a tax refund which paid my fees and paid for his holiday.

A year later he got a job with his uncle and was embarrassed to tell me his uncle’s accountant would now do his tax return.

‘ Is he qualified and will he save you tax? ‘ I asked Craig.

‘ Yes he’s sound, he’s passed all those exams ‘ he assured me whilst also telling me the cost would be cheaper.

I wished him all the best.

Yesterday Craig called me practically hyperventilating.

‘That accountant forgot to do my tax return until I reminded him, and now he’s telling me my tax bill is £1,500. He’s not qualified either, he just calls himself an accountant. Help me, help me please’.

I calmed him down, got some info, tapped my calculator a few times, and told him his tax bill would be about £180.

Craig is coming back to me. He can afford a holiday again – when allowed

Cheap isn’t cheerful, especially where tax bills, and ‘ pretend’ accountants are concerned.

Have you had a bad experience by going for low cost?

‘Impossible’ – This was a single released by American singer Perry Como in 1970, which was nominated for a Grammy.

It was a love song, but Perry could have also been singing about Stamp Duty Land Tax.

This is a deeply misunderstood tax relating to the acquisition of residential and mixed-use property.

Unless you are an expert you don’t have the time to understand and implement the various exemptions and reliefs.

Consequently, billions have probably been overpaid to HMRC.

But fear not, if you are a property developer or investor, a home buyer or involved in a pension fund that has acquired property and paid this tax, you may be able to backdate a claim 4 years ?

Recently we saved £70K where a property was transferred into a Pension Fund and SDLT was paid incorrectly.

Please get in touch and our team of experts can tell you if you may have a refund, or can avoid paying too much in the future.

In the meantime, you can listen to Perry, take it away Mr Como …..

I was interested to see a recent post on LinkedIn refer to accountants qualified for 30-40 years as ‘ has beens‘, comparing them to elderly hairdressers only capable of performing blue rinses.

Qualified accountants with 30 years post – qualification experience are approx 55 years old.

Based on this, my former office, one of the largest offices of the one largest accountancy firms in the UK, is run by ‘ has beens’, even though the office, and firm, is very successful.

When I left there, I was forcibly prevented from leaving the accountancy profession as people of all ages (even below ‘ has been‘ age) wanted to recommend me. I didn’t ask them, they approached me.

They wanted the benefit of experience, skill, knowledge, good reputation, resourcefulness, professionalism, years of training and maturity.

I guess everyone is entitled to their own opinion, but I personally wouldn’t be writing off everyone over a certain age.

Are you over 55 and think you are a ‘has been‘?

Is experience over-rated?

Should over 55’s be banished to an uninhabited island?

Here’s a pic of me inexperienced in dressing myself just before I passed my exams and qualified but, crucially, much younger than 55!

I know that my 30+ years in the accountancy sector has helped to save people significant sums of money and that experience will ensure I’m able to provide expert tax advice and money saving guidance for even longer.

I know which Russell I would prefer to take advice from and it is not the young, inexperienced one in this picture!

Before he was properly famous, I saw John Bishop perform at a Christmas event in Manchester. He did well, and I thought he had potential.

The other thing I remember about that jolly afternoon was a ridiculous conversation with another guest on our table about a comedy show, based on the hilarious subject of VAT.

I once saw the famous magician, David Copperfield, in Vegas. He made 30 people disappear on stage. At the time I wondered if he could make VAT disappear.

Last year the Chancellor did make VAT disappear- temporarily. If you had a VAT return to pay between March 20 and June 30 it vanished in a puff of smoke.

However, the smoke is clearing now, it needs to be paid by March 31, 2021. The Government has generously stated that we can pay it any time. That’s nice!

What if you haven’t got it or don’t want to pay it all at once?

Well, they are introducing a payment scheme and you can apply to pay over a period up to 11 months.

The details haven’t been announced yet, so that thrill is still to come.

After he became famous I met John Bishop at a Christmas charity event.

We had a very interesting discussion about VAT. At the end, he didn’t offer to keep in touch. I often wondered why …

To most people, provisions mean food or the terms of a contract.

To accountants, it means something different.

When accountants are in their formative years they are taught to be cautious. A good accountant word for this is ‘prudent’. Most other people would call this ‘miserable’.

It’s a glass half-empty approach to accounts preparation.

It means they assume the worst may happen and include estimated costs of that possible catastrophe.

So, for example, if it’s a financial advisor’s accounts, a figure is inserted for the likelihood of potential clawbacks (a repayment of commission earned).

If it’s a builder you include a figure for possible snagging (going back to fix work that isn’t perfect).

The good news is that provisions reduce tax bills.

So when your accountant asks if you want to include a provision, nod enthusiastically if you want to save tax.

Do you know how to nod enthusiastically?

Do you want to save tax? Call us or send us a message to find out how provisions can make you wealthier by reducing your tax bills.

Barry called, practically hysterical.

He used to have a thriving business but then experienced a number of calamities, not helped by his wife finding him in a compromising position with another lady.

His business and marriage collapsed.

The house was sold.

The call was because he had received a letter asking for £20,000 in 7 days from a firm that he didn’t know. He hoped it was a scam – but it wasn’t.

When the firm closed it owed a finance company £30,000.
He paid £10,000 off this when he sold his house.
This was the £20,000 balance left which the finance company has passed elsewhere for collection – a year later !!

He had signed a Personal Guarantee, so owed this personally.

We calmed him down
We explained what it meant.
We contacted the company that had written to him.
We bought him time.
They agreed a reduced amount.
We saved him a lot of money.
He survived the trauma.

If you have PG’s please check you know what they mean. Hopefully, you won’t be a Barry.

Do you have a PG?

If you have a PG and are concerned about being liable for company debt then call us for advice and we can make your problem a lot more manageable.

Many people paid their tax bill at the end of January.

Sally from Kent was one of those.

This year she paid less than usual!

In the past, she used to complete her own tax return.

She wasn’t paying some ‘toffee-nosed accountant’ to put figures in boxes. How hard could it be?

But her tax bills were high!

To humour her brother, she agreed to speak to a guy he knew ‘Up North’.

She was surprised that the guy had electricity and an indoor toilet, despite living in the North!

She was even more surprised that he told her about expenses and costs of equipment that could reduce her tax bill.

Not only could she save tax in the future but also reclaim some she had overpaid in the past.

The guy ‘ Up North ‘ now saves more than he charges her.

Be like Sally.

Ask a qualified accountant or tax professional to help you with your tax return. They could not only save you tax but get you some money back that you have already paid.

Here’s the Northern guy celebrating all his returns being filed last year with Wigan legend Jason Jolley and Southport legend Chris Harding – under electric lights!

Do you complete your own tax return?

Could you have paid too much tax?

Do you have electricity?