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For accounting purposes, cash transactions between a director and a personal or family company are recorded through the director’s loan account. At the end of an accounting period, if the director owes the company money (i.e. the account is considered overdrawn), and the company is close (broadly, one that is controlled by five or fewer shareholders (participators), there will be tax consequences to consider.

A tax charge will arise under the Corporation Tax Act 2009, s 455 where a director’s loan account is overdrawn at the end of…

The Making Tax Digital (MTD) pilot has been opened up to all businesses that will be mandated from April 2019 (i.e., the first VAT accounting period starting on or after 1 April 2019) to use compatible software to submit information directly to HMRC.

The pilot was opened at the end of 2018 to partnerships and VAT Flat Rate Scheme (FRS) users, and the following entities are now also able to join:

– EU traders
– businesses who file monthly VAT returns
– businesses that use non-standard VAT…

In broad terms, the Employment Allowance (EA) is available to most employers and should enable them to reduce the amount of National Insurance Contributions (NICs) they have to pay by up to £3,000 per year. The eligibility rules changed from April 2016, and the Autumn Budget 2018 announced further changes expected to take effect from April 2020. It is worth checking to make sure that a limited company is still eligible to benefit from this tax incentive.

Employers may generally claim the EA if they are a business (including…

The VAT rules for businesses suppling digital services to private consumers in other member states change with effect from 1 January 2019.

From that date, the place of supply will be the UK where both:

– a UK business is not established in any other EU member state; and
– the total value of cross-border digital sales is less than £8,818 in the current and preceding calendar years.

Businesses affected will no longer need to register for VAT in other EU countries where they have consumers or use the VAT Mini One…

Autumn Budget 2018 announced a new measure, designed to counter fraud in the construction industry, which has seen gangs of criminal traders artificially extending the chain of supply of labour services, then failing to account for all the output VAT due to HMRC by collecting the VAT on the supplies (sales) and then going “missing” before passing the VAT on to HMRC.

The proposed change, which is scheduled to take effect from 1 October 2019, will mean that for certain specified supplies of construction services, the customer will be…