The
Tail on the Dog
Tax is the tail on the business
dog. If you don’t make any money, you are
unlikely to be paying much tax.
But that doesn’t mean that
tax should be ignored when making business decisions.
Timing I particular is crucial to getting the best
tax breaks. There are some pretty generous allowances
out there for purchasing capital equipment, particularly
computers and the tax relief available can be brought
forward a year simply by purchasing an item one
day before the year-end rather than one day after.
Claiming for everything
If it’s business related,
put in a claim for it and let the accountant sort
out what’s allowable and what isn’t.
If you are a 40% taxpayer, even claim for all your
entertaining because whilst the company will pay
20% tax on the cost, you would have suffered 40%
tax on the money you would have needed to pay the
cost out of your own pocket.
Two companies – recipe
for disaster
Big decisions should always have
the tax implications considered first. The setting
up of a new company for a particular project may
have sound legal motives but the existence of a
new business could increase the first company’s
tax bill even if the second company makes no profit
at all.
In the meantime, in the real world
of business, the profit-making company is probably
subsiding the other company so it is not protected
from its losses anyway. Don’t forget too
that there will be extra accounting work and administration
too.
Don’t let tax rule your
business decisions though. If you make money, you
will have a tax bill, but the important thing is
to make sure the tail wags in the Inland Revenue’s
direction no more than it has to.
Getting the green light
on your affairs
With so many tax-planning options
available to you, it is crucial that you get someone
to look at your affairs in total. To help with
this, Marlow Associates have developed a programme
of tax planning to ensure that nothing is overlooked.
The programme designed for owner-managed
companies covers all of the following areas:
- Claiming all the allowable expenses that are
available to your business
- Ensuring you are drawing income in the most
tax-efficient manner
- Assessing your method of saving for retirement
to ensure you are getting the maximum tax relief
- Reviewing the way you are treating your car
to ensure it is helping to keep your overall
tax liabilities to a minimum
- One-off tax efficient remuneration solutions
for high profit Companies House
In addition to the green light
service, Marlow Associates offer the “Time
to go limited” service for unincorporated
businesses and long-term wealth planning for those
considering or already in retirement. |
