Latest News
Using
tax losses effectively
15 Feb 2010
There
is a difference between a trading loss and a tax loss. There are times
when you may turn in a trading profit which is converted to a tax
loss by claiming capital allowance, particularly the Annual Investment
Allowance. Having arrived at the tax loss there are then a number
of choices.
Primarily
these are:
1.
carry the losses forwards to set off against future profits of the
trade
2.
carry the losses sideways in the same tax year and set off against
other income
3.
or carry the losses back (how far back depends on individual circumstances)
There
is a temptation to go for options 2 or 3 as there is a real opportunity
to recover tax already paid and positively impact cash flow.
Unfortunately
this may not be the best option. The two main circumstances when option
1 may be a better choice are set out below.
a. Sometimes
you will be required to carry losses back or sideways until all of
your taxable income is covered. In some cases this may mean that you
get no benefit for your personal allowance which would be wasted.
b. An
immediate set off of losses may reduce taxable earnings that were
subject to basic rate tax in prior or current tax years when you may
be predicting earning in forthcoming years at higher rates.
With
the advent of the 50% income tax rate from 6 April 2010 and the gradual
loss of personal tax allowances for high income earners, carrying
losses forwards may be a better strategic choice - rather that a quick
set off at lower rates use the losses in the following year.
Please
note that the comments above are a simplification of a complex process.
If you are presently in a loss making position but can see profitable
times ahead, careful tax planning to maximise the benefit of the losses
is essential - give us a call.
Principal
Private Residence (PPR)
15 Feb 2010
If you
own property and are resident in the UK for tax purposes when you
sell the property there could be a liability in the form of capital
gains tax or income/corporation tax if you are a property developer.
The
most notable exception to this general rule is if the property you
are selling is your principal private residence.
For
most of us this is our home, the place where we live.
Of course
some of us may own more than one property. In which case how does
the PPR rule apply?
The
answer, as you would expect, is complicated. Generally speaking if
you own two properties only one can be considered your PPR at a particular
point in time. In the absence of making an election this is determined
based on the facts - generally the property used more. However you
can make an election to choose which property is treated as your PPR
within 2 years of acquiring a second residence. Having made the election
it can be changed at any time and backdated 2 years. Why would you
do this? The main tax advantage is that PPR status exempts the last
three years of ownership from CGT - in some circumstances other tax
breaks may apply if the property has been let. You will need evidence
that you actually took up residence in the second property.
Contact
us for further advice regarding PPR
Short-sighted
BBC uses actors as political football
10
Feb 2010
Equity
yesterday attacked the BBC’s plans to cut actors’ pay as
“short-sighted ” and “a disgrace”.
Equity
General Secretary Christine Payne commented: “Performers are
the BBC’s best asset. Viewers do not turn on their televisions
to see the likes of BBC Director General Mark Thompson, they want
to see Equity members performing in their favourite soaps, dramas
and comedies. Yet while Mark Thompson’s salary is safe he is
attacking performers who earn many times less than he does.
“Actors
in EastEnders, the Hustle, Casualty, Holby City, Dr Who and many other
of the nations favourite programmes are having their earnings slashed.
The threat to cut the earnings of every actor paid more than £100,000
is short-sighted and will damage the BBC in the eyes of viewers and
licence fee payers."
To read
the full press release visit www.equity.org.uk
Success
as Equity secures £400 in Commercial & Independent Theatre
27 Jan 2010
Equity
announce an agreement has been achieved with the TMA and ITC whereby
Equity's £400 claim will be met, in staged approaches by 2011.
Following
a series of difficult negotiations in Commercial Theatre Agreement
minimum rates will increase from 30th November 2009 in a three year
staged agreement, reaching £400 in April 2011. Equity encourage
members to ensure receipt of any relevant backdated monies. Please
contact your local organiser for further information on what these
amendments are prior to the publication of a new agreement.
Following
the start of the Manifesto for Theatre Campaign the ITC has agreed
to the 2010 claim for £400, a significant move from 2009 when
they rejected Equity's claim. The claim will be reached over two years
with the minimum increasing to £400 in April 2011.
To
find out more about the campaign and to get involved contact Hannah
Packham on hpackham@equity.org.uk.
