Pro-Taxman

Vikas Joshi

‘Normal gifts out of income’

The Oxford English Dictionary defines the word ‘normal’ to mean ‘conforming to a standard; usual, typical, or expected’. A minor, often misunderstood inheritance tax (IHT) gift exemption uses this definition of ‘normal’ whereby payments made (however large) are deemed to be inheritance tax-exempt transfers. To succeed, it needs to be shown that the payment represents …

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Legal v illegal dividends

Changed business conditions in light of the Coronavirus pandemic have caused many companies to review their dividend policies not least because the company’s financial position may have deteriorated significantly from that shown in its last annual accounts. The Companies Act 2006 requires that a dividend be paid only if there are sufficient distributable profits. Even …

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National Living Wage and National Minimum Wage changes from April 2021

Under the minimum wage legislation, workers must be paid at least the statutory minimum wage for their age. There are two types of minimum wage – the National Living Wage (NLW) and the National Minimum Wage (NMW). From 1 April 2021, as well as the usual annual increases, the age threshold for the National Living …

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Selling your main residence with land – Will the SDLT return trip you up?

Most people do not expect to pay capital gains tax when they sell their only or main home, particularly if the property has been their only home for their entire time that they owned it. However, what is less well known is that the exemption places a limit on the amount of garden that falls …

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Renovating the holiday let during lockdown

The Covid-19 pandemic has hit the hospitality and leisure industry hard. Landlords with furnished holiday lettings have been unable to let their properties for considerable periods of time as a result of national and local lockdowns. Properties need regular maintenance and refurbishment, and while being in lockdown is not ideal, it does provide a window …

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Deadline to benefit from increased SDLT threshold approaching

In July last year, the Government announced a temporary increase in the residential stamp duty land tax (SDLT) threshold to £500,000. The higher threshold applies where completion takes place between 8 July 2020 and 31 March 2021. From 1 April 2021, the threshold will revert to £125,000, with a higher threshold of £300,000 applying to …

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Self-employment and the £2,000 dividend allowance

All taxpayers, regardless of the rate at which they pay tax, are entitled to a tax-free allowance for dividends. For 2020/21 this is set at £2,000, so if you’re thinking of branching out to be self-employed or have made the switch last year, this is what you need to consider. Nature of the allowance If …

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