Everything You Always Wanted to Know About Tax (But Were Afraid to Ask)
Of course what you really want to know about tax is how to not pay it… Tax avoidance is one of the greyest of grey areas, beloved of grey men in grey suits (yes I do have a grey suit but you’re not very likely to see me wearing it) and definitely not to be confused with tax evasion. But you’re probably already confused by now…
The main difference is that tax evasion is ILLEGAL! Tax avoidance is, well, er… difficult to define… In principle if you stick to the rules then you will only pay the tax that should be paid and no more. So we all ‘avoid’ the tax that would be over and above our duty to pay it under current tax law. Where it gets into Alice in Wonderland territory is when someone’s affairs are complicated to the point where they, or rather the tax accountants they can afford to employ, can find loopholes in the law by setting up complex schemes and legal structures that run rings round those chubby little men with moustaches, bowler hats and stripy trousers that pop up in the Autumn and remind you to file a tax return.
So what are the rules? Well they cover income tax, corporation tax, inheritance tax, capital gains tax, annual tax on enveloped dwellings… Oh dear, eyes glazing over already! Her Majesty’s Awfully Nice Revenue and Customs have worked terribly hard to put all this stuff online (https://www.gov.uk/government/organisations/hm-revenue-customs) so I’ll leave you to browse it at your leisure, or if you’re really stuck give me a call and I will do my best to explain in the plainest English I can manage.
Cooking the Books
Ah, the joys of double-entry book-keeping! Detailed figurework that’s so nice you do it all twice… Having spent too many of my younger days scrivening away with pen and ink in dusty ledgers I am not about to take the wonders of modern day accounting software for granted. The battle for supremacy between desktop and online accounting programmes is well and truly over in my opinion, but many desktop packages are still happily whirring away in hushed offices and workspaces, and if it ain’t broke…
However my preference is for QuickBooks Online Plus (https://quickbooks.intuit.com/uk/) but I am just as used to Sage, Xero and of course the ubiquitous Excel, although I prefer to run FOSS software whenever possible (Open Office, Libre Office, Ubuntu, GNU etc.) rather than proprietary Microsoft or Apple products if I can.
A discounted online QuickBooks subscription costs £12 per month including VAT. I am not VAT registered (the annual threshold is now £85,000) and I don’t charge anything more than that apart from any agreed work done at my hourly rate. For more info on using online accounting packages just contact me using the details on the contacts page.
Don’t worry how messy your accounts are, Pro-Filing goes where other accountants fear to tread…
“Who does your taxes…?”
Money Laundering
Anti-money laundering (AML) legislation requires professionals to sign up to an AML service that provides identity checks and other types of validation, such as credit checking, and is mandatory for financial and legal fims, estate agents and, er, casinos…
This means I have to ask clients for proof of identity and possibly for other details, depending on the nature of their work and the services I am asked to provide. Yes it’s a proverbial pain, but it is the law, and as you can see it’s something I take very seriously…
