Let’s face it the tax system is very complex, full of regulation and filing deadlines. If you are not well versed in this area and keeping up to date of all the legislative changes (and based on your time limits you won’t be) then you definitely need an accountant. Furthermore the taxman has become increasingly aggressive in recent years with special task forces set up to target specific sectors for example, the health and well being tax plan.
Anybody who submits a tax return may now be the subject of a tax enquiry whether they are compliant or not. This raises the question, when exactly should you seek the advice of a professional advisor? It is a difficult one because the answer depends largely on your personal circumstances and where you are in terms of career progression. On this basis we highlight the following scenarios and our advice is if just one of them applies to you then it is time to find yourself a good advisor.
If you’re employed by the NHS and doing private practice work then first and foremost you need to be declaring your private income for tax purposes. If you have not been doing this it needs to be declared as a matter of urgency before it is identified by HMRC. If you are declaring this income then the entity through which you trade needs to be considered and your National Insurance position needs to be assessed. A good accountant can advise on both these matters.
If you have income from private work then it may be more tax efficient to operate through a limited company. There are a number of things to consider in this circumstance and you should book an appointment with an advisor who can calculate the potential tax savings for you.
If you are on PAYE income are you aware if your tax code is correct? It is your responsibility to check this and you will be expected to pay the tax if it is incorrect.
This one may surprise you but it is also applicable to previous years? Depending on the terms of your employment contract you could also claim tax relief on the costs you incurred when training.
Do you pay into the NHS pension scheme? Are you aware that if you and your employer contribute too much then you could suffer a tax charge? This is particularly relevant where you have a final salary scheme because these types of pension contributions are based on the change in value of your pension pot as opposed to the amount paid in. This makes it more difficult to monitor and is an essential part of tax planning.
If this is the case all rental income needs to be declared and you will need help calculating the tax due on it. You may also not be aware of the costs you can offset against the rental income. Tax may be due when you sell the property however, there are options to explore in terms of potential reliefs available on disposal.
The content of this post is up to date and relevant as at 25/11/2014.
Please be aware that information provided by this blog is subject to regular legal and regulatory change. We recommend that you do not take any information held within our website or guides (eBooks) as a definitive guide to the law on the relevant matter being discussed. We suggest your course of action should be to seek legal or professional advice where necessary rather than relying on the content supplied by the author(s) of this blog.
leave a comment -