Child Benefit Tax Charge

ByMandie

From 7th January 2013, child benefit will be subject to a tax charge, where one member of the family earns over £50k.

The charge will increase by 1% of the amount of benefit for every £100 earned over £50k so that by the time you reach £60k, the charge will be equal to the benefit received.

As this cannot be calculated until after the end of the tax year, the charge will be payable in the following tax year, either via the PAYE code or via self-assessment.

Don’t get caught out as there may be instances where the recipient of the child benefit is different to the person who will be paying the charge, so make sure you are aware of any consequences of this difference.

 

This blog was written by Lorraine Dale from Rightway Accounting Services. Do contact Lorraine for more information or if you need clarity on any of the points.

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ByMandie

Whether you’re new or not to self-employment, record-keeping might sound like hard work. And while that may be true, it does come with its own reward – namely, that sole traders can claim back allowable expenses and pay less tax on their earnings.

HMRC has a number of rules about record-keeping though. Mostly, they relate to the storage of receipts and other documentation after you’ve filed your Self Assessment tax return for that tax year. By not adhering to them, you run the risk of losing out on any tax relief – or worse, being penalised by HMRC