06 Aug A Fixed Fee Accountants Guide for Tax-Free Benefits
You’re probably stuck with multiple errands running at your end. This hardly gives you an opportunity to work on your big business plan. Let us help you with your goals. Receive great benefits from our end as a taxpayer. Let’s dig in deeper to understand what benefits would you receive by paying your taxes on time.
Fixed fee accountants make use of statutory exemptions for certain offers. This is the perfect opportunity to extract funds from a family company. Fixed fee accountants help you trigger a tax charge as per fixed fee accountants.
To save taxes, the benefit itself must be provided.
Taxes on Mobiles as per the Fixed Fee Accountants
As per the tax, charges arises where an employer provides an employee with a mobile phone.
Irrespective of the level of private use, the exemption applies to one phone per employee. Fixed fee accountants help you dive into the matter even further.
A taxable benefit is there if the employer meets the employee’s private bill for a mobile phone. Use top-up vouchers on any phone as per a fixed fee accountant.
John and Jan Smith are directors of their family-owned company. Their two children also work for the company.
The company takes out a contract for four mobile phones and provides each member of the family with a phone.
Bills are paid directly to the phone provider by the company as per a fixed fee.
The bills are deductible in computing profits as per fixed fee accountants. Each family member receives the use of a phone tax-free, which means they do not need to fund one from their post-tax income.
Pensions remain a particularly tax-efficient form of savings since nearly everyone is entitled to receive relief on contributions. Fixed fee accountants explain this even further by stating that annual maximum regardless of whether they pay tax or not.
The maximum amount which a non-taxpayer can currently receive basic rate tax relief is £3,600.
So an individual can pay in £2,880 a year, but £3,600 will be the amount actually invested by the pension provider.
Higher amounts may be invested, but tax relief will not be given on the excess. Any tax relief received from HMRC on excess contributions may have to be repaid.
Pension contributions paid by a company in respect of its directors or employees are allowable unless there is an identifiable non-trade purpose.
Contributions relating to a controlling director (one who owns more than 20% of the company’s share capital), or an employee who is a relative or close friend of the controlling director, may be queried by HMRC. HMRC will examine the company’s intentions in making the payment.
Other tax-free benefits
Other tax-free benefits that a family company may consider include:
- bicycles or bicycle safety equipment for travel to work
- gifts not costing more than £250 per year from any one donor
- Christmas and other parties, dinners, etc, provided the total cost to the employer for each person. You’ll pay not more than £150 a year.
- one health screening and one medical check-up per employee, per year
- the first £500 worth of pensions advice provided to an employee (including former and prospective employees) in a tax year
- medical treatments recommended by employer-arranged occupational health services. The exemption is subject to an annual cap of £500 per employee
Employ your family members to provide them with tax-free benefits. It’s also helpful for a family-owned company for low tax rates, personal allowances, and exemptions.
Additional Note: ITEPA 2003, s 244, s 308C, s 319; BIM46035, BIM47105