How to create a government gateway account to manage all your tax services online?

Apr 7, 2021 12:36:25 PM / by Vithusha Vijayakumar posted in Wednesday Wisdom, Accounting Questions, Tax, Corporation Tax, VAT, Accounting, Creative Industries, Government Gateway Account, HMRC, PAYE

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The government gateway account is an IT system developed to register for online services provided by the UK government, for example; Corporation Tax, PAYE (Pay As You Earn), VAT etc. This has originally replaced the old system which consisted of paper submissions.

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What is a cash flow statement, and the benefit of using it?

Apr 7, 2021 12:16:26 PM / by Claire Flanagan posted in Wednesday Wisdom, Accounting Questions, Creative Industries, Financial Reporting, Cash Flow, Profit & Loss, Balance Sheet, Income Statement

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What is cash flow statement?

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What tax relief claims can you make if you work from home?

Mar 24, 2021 8:48:16 AM / by Tom Kirk posted in Wednesday Wisdom, Accounting Questions, Tax, VAT, Accounting, Creative Industries, Management Accounts, HMRC, Tax relief

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Given recent events and the closure of offices due to the COVID19 pandemic, there has been a significant increase in people looking at making tax relief claims due to the additional costs incurred for working from home.

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What is an SA302 and how do I get my hands on one?

Mar 16, 2021 3:59:54 PM / by Tom Kirk posted in Wednesday Wisdom, Accounting Questions, Tax, Tax return, Creative Industries, Freelancers, SA302, Government Gateway Account

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Ah, mortgages and being a freelancer – it never seems like the easiest or simplest of things to navigate.

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What are pre-registration expenses for VAT?

Mar 9, 2021 10:23:32 AM / by Erin Walls posted in Wednesday Wisdom, Accounting Questions, SMEs, VAT, VAT Registration, Expenses, Creative Industries, VAT Refunds, Pre-registration VAT, Pre-registration expenses

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There is some scope to reclaim VAT on goods and services your business bought before registering for VAT. You will only be able to do this if you have the VAT invoices for such purchases. This reclaim is often a valuable means of funds in the earlier periods of trade.

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I am importing goods from the EU, when do I pay the VAT and any duty payable?

Mar 2, 2021 10:55:08 AM / by Erin Walls posted in Wednesday Wisdom, Accounting Questions, Tax, VAT, Accounting, Creative Industries, HMRC, Brexit, EU, Free Trade Agreement

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The existing rules for imports from non-EU countries now apply to imports from the EU, but with some changes. The UK government has introduced ‘postponed accounting’ for import VAT on goods brought into the UK with effect from 1 January 2021. This means that UK VAT registered businesses importing goods to the UK will be able to account for import VAT on their VAT return, rather than paying import VAT on or soon after the time that the goods arrive at the UK border. This will give a cashflow benefit.

This important relaxation applies to imports from the EU and non-EU countries. Postponed accounting can be used by all VAT registered business in the UK and no separate application is required.

However, customs declarations and the payment of any other duties will still be required. Customs duty (tariffs) will apply to some goods and excise duties will continue to apply to tobacco, alcohol and certain energy products.

Customs and excise duty payments can be deferred to be settled monthly with a duty deferment account. Businesses need to register with HMRC to open a duty deferment account and will need to provide a bank guarantee.

From 1 January 2021, VAT on imported goods with a value of up to £135 is collected at the point of sale not the point of importation. This means that UK supply VAT, rather than import VAT, will be due on these items.

Business-to-business sales not exceeding £135 in value are also be subject to the new rules. However, where the business customer is VAT registered and provides its registration number to the seller, the VAT will be accounted for by the customer by means of a reverse charge.

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I sell directly to a consumer in the EU so is that any different?

Feb 22, 2021 2:12:40 PM / by Erin Walls posted in Wednesday Wisdom, Accounting Questions, Tax, VAT, Accounting, Creative Industries, HMRC, Brexit, EU, Free Trade Agreement

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The basic principles are the same; for UK purposes you are making a zero-rated sale but on the EU side, these sales will be subject to import VAT (and duty) on arrival.

This may mean that the customer has their goods held at customs until they pay the import VAT.

If you sell through a website you will need to make sure that your terms are amended and that the VAT element is correctly calculated in your checkout.

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So do I just bite the bullet and register for VAT in at least one EU country?

Feb 22, 2021 1:27:43 PM / by Erin Walls posted in Wednesday Wisdom, Accounting Questions, Tax, VAT, Accounting, Creative Industries, HMRC, Brexit, EU, Free Trade Agreement

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For some businesses that may be the best solution out of a number of undesirable options. You will need to take further advice and consider your supply chains and where your customers live should you wish to consider this route.

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What changed for UK and EU digital services providers?

Feb 16, 2021 10:38:37 AM / by Erin Walls posted in Wednesday Wisdom, Accounting Questions, Tax, VAT, Accounting, Creative Industries, HMRC, Brexit, EU, Free Trade Agreement, Brexit FAQ

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Brexit FAQ

From 1 January 2021, for UK businesses supplying digital services to non-business customers in the EU, the ‘place of supply’ continues to be where the customer resides. VAT on those services is due in the EU member state in which the customer resides. The £8,818 annual threshold for cross borders sales of digital services to EU consumers no longer applies.

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I don’t make or sell a physical product, so none of this applied to me right?

Feb 10, 2021 2:45:09 PM / by Erin Walls posted in Wednesday Wisdom, Accounting Questions, Tax, VAT, Accounting, Creative Industries, HMRC, Brexit, EU, Free Trade Agreement

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Well… perhaps. If you are a service provider, for example you are provide branding or marketing or architecture services then the changes to the treatment of physical goods do not impact your sales.

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