Rebates & Tax Savings
It may seem like every area of your business has some form of tax in place, but there are actually plenty of tax breaks which can help you save some money.
Tax rebates and savings can be reinvested into your business, to assist with training costs, purchase new equipment and start up new services, or even increase marketing spending and advertising.
There are relief schemes in place for a whole range of issues, from environmental and energy use and car running costs to personal entertainment costs and tax-free salaries which you pay to family members. Some will not need to be added to a tax return at all, and some will need to be reclaimed after you have paid (a rebate).
What Can I Claim A Tax Rebate Or Saving On?
Some of the most popular and common ways to save or re-claim on your tax payments, including VAT and Capital Gains/Corporation Tax, are:
- Vehicle Running Costs: Sadly, this doesn’t include the commute to work, but if you have to use your car to meet clients and for general business use, then you could claim back a portion of the fuel and general maintenance costs
- Home Running Costs: Most business owners will usually spend a bit of time at home doing work, such as looking over accounts and general paperwork. You could claim a proportion of the household bills as a business expense including heating and lighting costs and council tax, based on the size of the house
- Family Employees: If a family member does any work for the business, you can pay them an appropriate salary and claim it as an expense. If they have no other income, some or all may be tax-free
- Employee Loans: A company could lend an employee up to £10,000 with no tax implications for them, provided they are not a director. This is common if they have an annual travel card to purchase
- Business Trips: Costs such as travel, accommodation and even meals may be partly covered, no matter how much they were
- Phones: The cost of business lines, mobiles and calls from personal phones could be claimed back and not included in tax returns
- Pensions: There is now auto-enrol in place, and if you contribute towards your employee’s pension pot you may be eligible for tax relief on those payments
- Staff Parties: From the Christmas Party to annual dinners, as long as it is below £150 per head, one per year can be exempt from tax contributions
- Selling Assets: There is a Capital Gains Tax threshold in place, plus a few deductions which can be made depending on how you have disposed of the asset and what it was
- Energy Costs: If you have particularly high energy usage due to the nature of your business, or you have gone green, there may be tax relief in place
- Research Costs/Creative Industries: Some businesses incur research and development costs, but few claim for the tax credit (R&D tax credit). Income from patented inventions and income from work in the creative industry may also be eligible for breaks
How Can An Accountant Help With Tax Rebates And Savings?
Even though HMRC have a helpline in place to help you out with all things tax, VAT and extra charges, they aren’t trained (or really meant) to help you pay less. This is where an accountant can come in handy, as they will know all the ins and outs of your business and can help you save money in all areas. They can:
- Help With Accounts: If you need bookkeeping or financial help from the ground up, they can get everything in order. Or, they can recommend the perfect software which can categorise your expenditure so all claims are calculated before your very eyes
Find Savings: An accountant can tell you if, what and how you can claim for every cost on your accounts. There may be dozens out there you don’t even know about, such as home energy costs
- Recover VAT: Invoices you paid or received before you registered for VAT can still be included in claims. An accountant could look over past years’ accounts and advise on how best to deal with this
- Time Management: There are time limitations and strict payment dates in place from the HMRC, which can result in fines if you miss them. If you’re rushing at the last minute, there is a good chance you’ll miss something. Outsourcing this and getting everything in order in time will save you a headache, and online accounting can give you real-time access and updates
- Advice: Perhaps most importantly, they can offer future advice on how to deal with issues in order to avoid paying high levels of tax or how best to claim, for instance, if you want to best work around Capital Gains Tax when selling a property
- Overall, an accountant can help you save as much money as possible, without you missing any little expenditures or spending time which could otherwise be put into running your business.
Having somebody who is financially and legally minded assist you will also help – it could be easy enough to misinterpret some of the saving or reclaim information.
Business tax savings are a lot more complex than personal ones, so having the advice on hand will be welcome. You will have unlimited access to this advice, too.