With more and more Britons having more than one source of income, demand for the services of personal tax return accountants has risen in recent years.
People in full time employment now often need a UK personal tax accountant to correctly calculate the tax they owe from one or more sources of personal income and to submit their return to HMRC. As with all other types of client, your accountant’s job is to make sure you pay absolutely no more tax than you need to.
Black and White is an established firm of accountants, bookkeepers, and businesses advisors servicing individual, SME, and corporate clients in Surrey and Hampshire.
In recent years, we have invested more into our private client division as the number of enquiries from customers has grown – we look forward to finding out more about you and introducing you to your own Black and White individual tax return accountant.
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Ask us about our personal tax services here and book an hour’s free consultation!
The personal self assessment tax return
Most taxpayers required to submit annual self assessment forms are either:
- sole traders or a partner in partnership
- limited company directors working for the business in which they own shares
However, many more people than that must register for and complete each year a self assessment form. We can help you with your personal self assessment tax return if you fit into any of these categories:
High employment income
If you earn over £100,000 a year, you must register for self assessment even if your earnings are derived exclusively from salary on which you already pay income tax and national insurance. For every £2 you earn over £100,000, your personal allowance decreases by £1 meaning that people earning £125,000 or more no longer have an annual personal allowance. There are also implications for people earning £50,000 or more with Child Benefit payments so let us guide you through your responsibilities.
Dividends are distributions of profit from companies in which you own shares. Each taxpayer has an annual £2,000 dividend allowance under which tax does not have to be paid. Taxpayers earning under £10,000 a year from dividends should inform HMRC and those earning £10,000 or more must register for self assessment – we can help.
Tax is paid on any profit you derive from property you personally own which you rent out to others. The legislation on rental income on flats, houses and holiday lettings was changed a few years ago which resulted in higher tax liabilities for landlords.
You will also need to report income from furnished holiday lettings anywhere in the European Economic Area.
You pay no tax on the first £1,000 worth of income on the property that you personally own. If you earn between £1,000 and £2,500 a year, HMRC must be notified.
For income of £2,500 a year or more, the situation is more complicated and it depends on your actual level of income and whether allowable expenses can be considered in the calculation of that income. In either case, you’ll need to report it on a self assessment form with the supplementary SA105 page.
HMRC has launched a tax-raising drive called the “Let Property” campaign whose goal is to encourage landlords to report undeclared income. If you are concerned that this campaign may affect you, please contact us without delay on 0800 140 4644 or email [email protected].
Income on interest earned
The situation on the taxation of income earned has become more complicated since the introduction of the Personal Allowance and the Personal Savings Allowance. If you go over those allowances, you will have to pay tax on the interest earned at your standard rate of income tax. For individuals whose income from investments and savings is above £10,000, you will need to register for self assessment.
Black and White’s personal tax accountants can assist you in working out if you have to pay tax on your interest, register for self assessment, or both.
If you earn any income from overseas pension or land/property abroad, you will need to declare it on an SA106 self assessment supplementary form. Likewise, you will need to use that form to declare foreign tax paid on income (including self-employment and employment) from overseas as well as dividends from overseas and interest earned from outside the UK.
Capital gains tax
Capital gains tax is paid on the profit made on sales of shares (not those contained in a PEP or an ISA), businesses, personal possessions, and homes (except your primary residence). If the profit made from all qualifying sales is greater than £12,000 in a particular financial year, tax is payable on that profit – 10% for basic taxpayers and 20% for higher and additional rate taxpayers (except on non-primary-residence property which is taxable at 28%).
We can report capital gains tax on your behalf via the “real time” service or by using the SA108 self assessment supplementary form.
EIS/SEIS/VCT tax relief
Taxpayers benefit from substantial HRMC incentives on VCTs and when investing in EIS- and SEIS-qualifying companies. For all schemes, income tax and capital gains tax incentives are offered so long as an investor follows HRMC’s rules on how long they hold their investment.
If you have invested in a VCT or a qualifying EIS or SEIS company and you’d like us to provide a summary of your current position and the options available to you, please get in touch.
With Gift Aid, charities may claim an additional 25p for every £1 in donations you make. Please note that not all donations qualify for Gift Aid.
Higher and additional rate taxpayers may claim the difference from HMRC on the difference between Gift Aid rate paid and the basic rate on any donation you make. For example, if you donate £1,000 to a charity, the charity may claim £1,250 on your contribution if they applied for Gift Aid. If you pay tax at 40%, you are able to claim back £250 (equivalent to 20% of £1,250).
You can bring forward donations using Gift Aid on your self assessment form to benefit sooner from the tax relief you’re owed.
From the age of 55, you’re entitled to cash in a quarter of the value of your pension tax free without it affecting your Personal Tax Allowance. If you wish to take out more than 25%, you will pay tax on it whereas, if you don’t, tax will be payable on either the annuity or the investment income (subject to your annual tax allowance).
If you are in receipt of pension payments and the total income you receive (including from pension payments) is greater than the annual personal allowance, you will pay tax at the applicable rate. Our team can help you work out the applicable rate and ensure you’re not over paying.
Multiple sources of income
If you receive income from multiple sources including a salary from your employment, the calculation of the tax you owe will be complicated. Over three million UK citizens now freelance in addition to being in full-time employment and you should expect HMRC to launch a campaign in the near future to encourage people to declare any unreported income they have benefited from.
If you have multiple sources of income, please contact Black and White as soon as possible on 0800 140 4644 or email [email protected] so we can calculate how much tax you may owe from this financial year and from previous financial years
Personal tax accountant near me in Surrey and Hampshire
If you need to register for self assessment, you must do so by 5th October. In some cases, you will be expected to make payment for any tax owed in full by 31st January following the end of the previous tax year (5th April). In other cases, you may have to make payments on account to HMRC.
Tax in the UK is complicated and many people do not register for self assessment when they should because of that complexity.
We’re pleased that much of the work we do in our private client division is when existing customers recommend our personal tax accountant services to others. Our goal when you entrust us to become your personal tax accountant is to provide you with the most accurate service in the quickest time at the most competitive rate possible resulting in your paying no more than you need to in tax.
To find out more about our personal tax accountant services, please fill in the form on this page, call us free on 0800 140 4644 or email [email protected]. We’re offering an hour’s free consultation to new clients and we’d really welcome to opportunity to meet you.