The VAT Flat Rate Scheme (FRS) is designed to simplify the calculation of VAT due for small businesses. VAT is calculated by applying a predetermined flat rate percentage to the business turnover.
In 2015, of the 324,000 small and medium sized businesses seeking a loan or an overdraft, 26% were initially declined by their bank. Historically the majority of businesses seeking finance only ask one lender. If they are rejected for finance many give up on investment rather than seeking alternative options.
For many owner-managers, the proceeds that they receive from the winding up of a company will be treated as a capital gain. Assuming that the relevant tests are met, this gain will usually qualify for Entrepreneurs’ Relief and a rate of 10% tax.
Entrepreneurs’ Relief (ER) has been with us for many years and provides a valuable relief – only a 10% rate of capital gains tax on lifetime gains of up to £10 million. However, as with everything in the world of tax, there are always niceties to be observed in order to ensure that you qualify for ER.
There was some welcome news from Philip Hammond’s Autumn Statement for small and medium sized companies regarding the tax relief available if a company makes a loss.
The state pension is clearly a worthwhile thing to have, particularly for the self-employed who will receive a pension through the new ‘flat rate’ pension. However, there have been numerous changes to the qualification criteria over recent years and now may be a good time to check your entitlement.
Venture Capital Trusts (VCTs) were introduced as a tax relief in 1995. VCTs invest in small companies and there are various constraints on the type of company into which a VCT can invest. VCTs are quoted on the stock exchange.
Over the years we have had a number of different ways of measuring inflation. These measures are important for many reasons but are especially important as a basis for altering the amount of pensions and benefits that are paid.