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 PRIME ADVISORS Ltd
Prime Advisors Ltd,
NEW ADDRESS:
Ocean Air house
Suite 200, Floor 1,
750-760 High Road, Leytonstone,
London E11 3AW
Tel - 0044 208 530 6929
Fax - 0044 208 989 1179
E-mail: primeadvisors@yahoo.co.uk

 
   

TAX ALLOWANCES

Allowance

Age

Tax year
 ending 5 April

Amount

Personal

up to 65

2001
2002
2003

4,385
4,535
4,615

65 to 74

2001
2002
2003

5,790(1)
5,990(1)
6,100(1)

75 Plus

2001
2002
2003

6,050(1)
6,260(1)
6,370(1)

Married Couple's(2)

65 - 74
66 - 74
Age 65
before 6 Apr 2000

2001
2002
2003

10% of 5,185(1)
10% of 5,365(1)
10% of 5,465(1)

75 Plus

2001
2002
2003

10% of 5,255(1)
10% of 5,435(1)
10% of 5,535(1)

Blind person's

any

2001
2002

1,400
1,450

Widow's bereavement(3)

any

2001
2002

10% of 2,000
no allowance

Children's tax credit

any

2001
2002

no allowance
10% of 5,200(4)

WFTC

any

2003

Basic tax credit of 60 a week
Extra 11.65 if 1 partner works at least 30 hours a week.
Tax credit for ea child of 26.45 from birth.  27.20 from the Sept after 16th Birthday until the day before 19.(5)
Childcare tax credit of up to 70% of eligible childcare costs to a max of 135 a week for one child and 200 a week for 2 or more children.

(1) The amount of these allowances is reduced if total income is above a certain amount.  In the tax year ending 5 April 2001 the allowances were reduced if total income was over 17,000 and in the tax year ending 5 April 2002 the income limit is 17,600.
(2) From April 2000, this allowance was abolished for people born on or after
6 April 1935.  Where the allowance received by an older person is restricted because of income - see note (1) above - it will not be reduced below 2,000 in the tax year ending 5 April 2001 and 2,070 in the tax year ending 5 April 2002.
(3) This allowance is abolished for deaths occurring after
5 April 2000.  Where death occurred during the tax year ending 5 April 2000, the widow also received the allowance in the tax year ending 5 April 2001.
(4) But the credit is reduced by 2 for every 3 by which your income exceeds the higher-rate tax threshold.
(5) Is reduced by 55p for ea 1 of net income above 94.50.  Savings are less than 8,000 but savings above 3,000 are taken into account in assessing your income.  It is assumed you earn 1 a week from ea 250 of savings above 3,000.

 

STARTING YOUR OWN BUSINESS

Tax Information

Stake Holder Pensions

The Government in setting up the stake holder pension has insisted that pension companies which sell the stake holder pension do so within the 1 per cent charging cap.  Other charges are to be dropped.  However check the small print carefully.   The stake holder pension is open to virtually everyone in the UK.  Also all contributions into stakeholder and personal pensions will receive immediate basic-rate income tax relief, regardless of whether the beneficiary has an income tax bill to offset against the payment.    The most anyone can put into the stakeholder in a year is 3,600 but with tax relief the cost drops to 2,808.  Higher tax-rate taxpayers will be able to claim additional tax relief - making the cost just 2,160.  As, under present rules, the stakeholder cannot be cashed until retirement it makes a good gift for your children!!

Are you self-employed?

The inland revenue take this to mean those people who run a business on their own, or in partnership with one or more people and who work for themselves, and not working for an employer.  For more details see leaflet IR56/N139 which can be obtained from your local tax office.

Who do you need to tell

Well, your local tax office, the contributions agency, customs and excise (vat) - if your taxable income is more that 52000 per annum - and your job center if you are registered with one.

There is a form for telling your tax office etc that you have become self-employed and it is CWF1 - Notification of self-employment - obtainable from your local tax office which must be completed and returned to your tax office within 3 months of starting self-employed.

Accounting Date

This is up to you.  It can be to the end of your first year's trading; to the end of a particular month; for the calendar year ending on 31 December, or to the end of the tax year on 5 April.   If you expect your profits to be on the high side  then seek advice about when your accounting date should be.  Likewise if you are unsure about anything - get advice first (our clients receive free advice)  - in the long run you will be glad you did.

The Tax Return

Each year, in April you will receive a tax return asking for information about your profits (if any) etc.  You can complete the return yourself - instructions are provided with the tax return - but if you have any doubts or problems about what to enter you can contact the tax office for advice or better still become a client of Prime Advisors.

 

 

   
 

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