Tax planning in Cray Meadows

Company directors in Cray Meadows deciding how to pay themselves, higher earners near the £100,000 personal allowance taper or the £125,140 additional rate, couples who could use both sets of allowances better, landlords and investors with gains to time, business owners approaching a year end with profit to deploy, and anyone whose affairs have grown more complicated than their current adviser has noticed.

• A review of your current position across income tax, National Insurance, dividends, Corporation Tax and capital gains as relevant
• Allowances and reliefs checked: personal allowance taper, marriage allowance, pension annual allowance, dividend and savings allowances, ISA use
• Director remuneration modelled: salary, dividends, pension contributions and benefits for the coming year
• Timing decisions quantified: dividends across tax years, capital expenditure before year end, pension contributions, disposals
• A written report with the recommendations, the saving from each and the actions in order
• A follow-up call to answer questions and agree what we implement for you

1. Tell us your situation

   A short message or call about what you do and what needs filing. We ask the questions that determine the right package and nothing more.

2. Fixed fee in writing

   You receive one price for the work, confirmed by email before anything starts. It does not change if the job takes longer than we expected.

3. Send records, review the draft

   Records come by WhatsApp or email. We prepare the draft, explain the figures in plain English and answer your questions.

4. We file, you get the receipts

   Once you approve and the fee is settled, we submit electronically and forward the HMRC or Companies House acknowledgement the same day.

Cray Meadows is in South East London, within Bexley, in the DA14 postcode district, England. Income tax in England follows the UK rates: 20% basic to £50,270, 40% higher to £125,140 and 45% additional, with the personal allowance of £12,570 tapered away above £100,000. National Insurance, VAT and Corporation Tax are UK-wide, and Stamp Duty Land Tax applies to property purchases.

The Self Assessment calendar

Four dates govern Self Assessment: 5 October to register, 31 October for paper returns, 31 January to file online and pay, and 31 July for the second payment on account. Missing the January date triggers an automatic £100 penalty before any tax is even considered, so we treat it as the fixed point around which the rest of the year is planned.

Payments on account

If your Self Assessment bill exceeds £1,000 and less than 80% of your tax was collected at source, HMRC asks for two advance payments towards the following year, each half of the current bill, due 31 January and 31 July. The first year this happens the January payment is effectively one and a half times the bill. We model it in advance and show you how to reduce the payments if income is falling.

Late filing penalties

Lateness is expensive in a way that compounds. For individuals, £100 immediately, then daily penalties, then percentage-based ones at six and twelve months, with interest running on unpaid tax throughout. For companies, Companies House penalties scale with delay and double on repeat, and HMRC adds its own for a late CT600. Filing on time is the cheapest tax planning there is.

Making Tax Digital for Income Tax

The biggest change to Self Assessment in a generation is Making Tax Digital for Income Tax, now live for higher-earning sole traders and landlords and arriving for the rest in stages. Quarterly updates are due by 7 August, 7 November, 7 February and 7 May, built from digital records. The practical consequence is that spreadsheet-and-shoebox bookkeeping is ending for anyone above the threshold.

The VAT registration threshold

Watching the rolling twelve-month turnover figure is one of the quiet jobs of monthly bookkeeping, because the £90,000 VAT threshold arrives silently. Crossing it brings quarterly returns, Making Tax Digital software and a decision about schemes. Crossing it late brings a bill for VAT you could not recover from customers and a penalty for failing to notify.

Corporation Tax rates and marginal relief

Since April 2023 there have been two Corporation Tax rates, 19% small profits and 25% main, with marginal relief smoothing the transition between £50,000 and £250,000 of profit. The band is where planning matters: each pound of profit in it is taxed at an effective 26.5%, so pension contributions and capital expenditure timed to keep profit below £50,000 are worth more than they look.

Salary versus dividends

The salary-and-dividend split is the central planning decision for an owner-managed company. Salary costs employer National Insurance above £5,000 but is deductible; dividends are not deductible but attract lower personal rates and no National Insurance. The optimum changes each April with the thresholds and depends on the director's other income, so it should be set deliberately every year.