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To May's Tax Tips & News, our newsletter designed to bring you tax tips and news to keep you one step ahead of the taxman.

If you need further assistance just let us know or you can send us a question for our Question and Answer Section.

We are committed to ensuring none of our clients pay a penny more in tax than is necessary and they receive useful tax and business advice and support throughout the year.

Please contact us for advice on your own specific circumstances. We're here to help!
May 2018
· Use gift Aid to save tax
· Diesel car supplement increase takes effect
· HMRC update guidance on MSCs
· When are tips taxable?
· May questions and answers
· May key tax dates
Use gift Aid to save tax top
HMRC have recently highlighted that charities are collectively missing out on some £600m extra funding because a third of donations made do not add Gift Aid when they could have done so.

Broadly, Gift Aid allows charities and community amateur sports clubs (CASC) to claim an extra 25p for every £1 donated. To add Gift Aid to a donation, the donor must have paid income or capital gains tax that year worth at least the value of the Gift Aid being added, and must give the charity permission to claim it. Gift Aid costs no extra to add on to the donation.
Read More
 
Diesel car supplement increase takes effect top
HMRC update guidance on MSCs top
The rules for taxing petrol company cars apply equally to diesel cars, but the latter are then subject to further adjustment.

The taxable benefit arising on a car is, broadly, calculated using the car's full manufacturer's published UK list price, including the full value of any accessories. This figure is multiplied by the 'appropriate percentage', which can be found by reference to the car's CO2 emissions level using HMRC's ready reckoner. This will give the taxable value of the car benefit.
Read More
HMRC have updated their guidance, following the recent decision in Christianuyi Ltd v R & C Commrs [2018] UKUT 10 (TCC), in which the Upper Tribunal ruled that a number of companies were operating as managed service companies (MSCs).

In this case, the Upper Tribunal upheld the decision of the First-tier Tribunal that the appellant companies were MSCs within the scope of the MSC legislation, and subsequently that the individuals were liable for PAYE income tax and National Insurance contributions (NICs) on the dividends they received from the appellant companies.
Read More
 
When are tips taxable? top
The Summer season usually sees a rise in the number of casual staff taken on by restaurants and cafes. Whilst the tax and NIC implications of wages is generally straight-forward, confusion often arises regarding tips and gratuities as the necessary tax and NIC treatment depends on how they are paid to the recipient.

Cash tips handed to an employee, or left on the table at a restaurant and retained by that employee, are not subject to tax and NICs under PAYE, but the employee is obliged to declare the income to HMRC - HMRC often make an adjustment to the employee's PAYE tax code number to reflect the amount likely to be received during a tax year and the tax and Class 1 NICs due will be collected via the payroll.
Read More
 
May questions and answers top
May key tax dates top
Q. I own a rental property, which has a mortgage on it. The mortgage is currently on an interest-only basis. Given the new interest relief restrictions on landlords' finance costs, should I consider switching to a repayment mortgage? Answer

Q. My grandmother died on 3 May 2017. Her estate on death includes 12,000 ordinary shares in XYZ plc, a company listed on the London stock Exchange. The closing prices at the date of her death showed a bid price of 989p per share and an offer price of 993p per share at the end of that day. Recorded bargains on that date were listed as 970p, 980p, 983p, 989p, 993p, and 996p. How is the value of the shareholding calculated for inheritance tax purposes? Answer

Q. I am thinking of buying a property in England to rent out. Will I be able to offset the legal fees, stamp duty land tax, and deposit costs against the rental income I hope to receive? Answer
2 - Last day for car change notifications in the quarter to 5 April - Use P46 Car

19/22 - PAYE/NIC, student loan and CIS deductions due for month to 5/5/2018

31 - Deadline for copies of P60 to be issued to employees for 2017/18

 
Need Help? top
New Clients Welcome top
Please contact us if we can help you with these or any other tax or accounts matters.

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About Us top
Merlin, based in Doncaster, offer a wide range of accounting, tax and insurance services to both businesses and individuals whether their requirements range from complex or simple. With customer satisfaction and service at the centre of everything we do all our clients can expect a high quality experience throughout their time with Merlin.

If you want to know more, especially about our 20:20 Deal and eAccounting methods, please visit our website www.myaccounts.co.uk for more information.
 

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