Clearview National July 2016 - Issue 176 - Page 74

INSTALLERSUPPORT ALLOWABLE EXPENSES FOR CONTRACTORS »»BELOW IS A LIST FROM TAX SMART Group of ‘common expenses’ claimed by the majority of contractors operating through a limited company. This list is not exhaustive, for the A to Z of expenses allowable under a limited company please visit the HMRC website and use search term ‘expenses and benefits a to z’. As a general rule of thumb, you can reclaim all expenses that have been incurred wholly, exclusively and necessarily in the course of running your limited company. There are variable rules around expenses that have a dual purpose (i.e. for both personal and business use), some are allowable based on a simple calculation (proportion of utilities if working from home) and some are not allowed regardless of their business proportion (mortgage interest, council tax). There is no order of importance to the order in which these have been listed: 1. Director’s salary Typically, a Sole Director should take around £8,060 p.a. which is £672 per month and just below the Primary Threshold (PT). If the Limited Company has an employee other than the Director and is paid over the £156 per week then Tax Smart Group recommend the Director takes a salary of £11,000 in order to maximize the Annual Personal Tax Allowance and reduce the Gross Profit by an additional £2940 and save £588 on the Corporation Tax bill. 2. Salaries paid to Employees It is possible that you may ask your spouse or another member of the family to help you with the management of your limited company affairs. You can register this person as [[\YYHۈ[\\[H^\ \š[]YX[[ZHY[YHوXZ][\0LK \[[H^ YYK\0LK \[[H[\HZY[\\K™[\YYH\ L H^YXXKˈ[\Y\\ HP۝X][ۜœ^XXHۈ[\Y\\[H[\YY\’Y[H[\H[Y][ۘ[[\YYH[^B[Hݙ\0MM\YZ[H[HXXB LH[\Y\Pˈ[H[XZ]B[\[[و0  \و\[ MK[H[\Y\PZYݙ\\° \ L H^ YYXXHYX[[]]\YXYH[\ܛ[\YܙHB\[[]Y] K0S M0PTHHHR B Z[XYH[و \ Z[H܈B\ L Z[\[ \ Z[H\XY\܈ۈZXH\B][Y[H\HH\[\[HZXK][[܈\[\\\[H[Z[H܈ \ Z[K܈[܈Z\\H\B]]Hو \Z[K[܂XX\ \Z[KK\[–[H[[Z[B܈\[[Bۙ\[ۈ\\˜][HX^HZ[H܈\[™[\܈YY[[\˂XX[ܝHو][HXX[ܝ[HZ[YY][H]\]HB[YXZ\ [Z[Z[][^[\]\Y\XH][HY\HHوH]\X\ۋ][ۜZ[XYK\Hو[ܝ]˂LYH[[HZ[YY][B]\[[]H\HܜXBY[H]Hܚ]YHۈHY[\\\[H[ۛHZ[H܈[][\ܚKˈ\[\[\ۙB[[ؚ[H[Y[܈H^Bو\[[XX]H܈[\ܚ\XK\Xܜ [[\YY\H[&]Z[BX[Hܝ[ۈو[ [ܝYB[\\ ܈[[^HZ\\[Y\\\H[]HY[ZY\ۘ[B[]^KLˈ\\Hو\]\\]Z\Y[[ٝ\KM Y\\[[X\][و[\\[\˂MK\[\Y\0L\[]YX[\H[XHYܙB[ܙH\^[\\KM[\\˂ˈX\[BX\[H[Y\YX[[X[[][ۈ[][[B[\ܘ\HXHوܚˈ\\[Y][ۈ›\X\\Hو][[Kˈ\[˜\\ۙ\[ۈ\\܈\[\œۙH[˂ Z[[\HY\\ۙ\H[\H[][H\[\ž[H\H[Mˈ\X\\H^[\[ۈ܈\Xܜ˜[[\YY\و0ML\\ۈ\YX\[H[[YH[\\\܈\JKN ٙ\[ۘ[Y\X\˜X[[܈X]܋NKٙ\[ۘ[Xܚ\[ۜ˂ \][[[\Š\XX][ۈو\]KK][ۙ\KYK[[[ŒK\[\XY^[\[˂L \[\[\[BH[[\\\و\[\[\[BX\XXXX[]K[\Y\XX[]KY[^[\^[\Y][ۋ[ٙ\[ۘ[[[[]H[\[H\H[Y][X]H\[\^[\[\H L B[XK[^YH\܈[\YY\\H\]\\]Z\Y[ ˈ[[X[]]HX[X܈[\YY\˂ [[ۈ۝X][ۜ‚LK\[HܛX][ۈ[ۙ[ŠKˈ[X[]\YJB[YH\[HܛX][ۈYB\H8&\][8&K[[H]ٙYZ[ܜܘ][ۈ^ [\[YBX[[H\X\X\^X\ܛ\ \H\[][\[\[Z]Y\[K\\XH\\܈ZY[HۛK^[HZ[\\HH\X]Y\XHق^][ۋ[[H[[^\ۜ[[\X[[Y[H]H[H]Y\[ۜ˂˝^X\ܛ\ ˝Z‚