Anna’s Accountancy Alerts – Week 6 (11th – 17th May 2020)

Accounting

Register For Child Benefit If Your Income Has Fallen

If your or your partner’s taxable income falls below £60,000 the high income child benefit charge (HICBC) will be less than the child benefit you could claim. If there’s the slightest possibility that you (or the person liable to pay the HICBC) will have income of less than £60,000 for 2020/21, don’t delay making a claim as child benefit will only be paid for up to three months in arrears.

Be aware that Income you receive under the Coronavirus Job Retention Scheme or Self-employment Support Scheme counts towards your taxable income for HICBC purposes.

Expenses For Volunteer Workers – Are They Taxable?

To the extent the amount paid simply reimburses all the costs you incurred as a result of doing volunteer work it’s not taxable. If what you receive exceeds your costs the difference is taxable (but not liable to NI). However, the trading allowance can apply. This exempts miscellaneous income of up to £1,000 per year.

Short-Term Borrowing From Your Business

There are no tax and NI consequences if you are a sole trader or a member of a partnership. By contrast, as a director shareholder any money you take from your company can count as taxable income. To minimise or eliminate tax or NI bills, take the money as a debit to your director’s loan account.

Stay Up-To-Date With Coronavirus & Brexit News

Coronavirus has affected us all. Whether you’re a sole trader, employer or employee. Stay up to date with the latest news – including government support, tax implications, and more.