Property losses- do I need a tax return?

Property losses- do I need a tax return?I have a Buy to Let property, but because of the size of the mortgage, I do not make any profit from it. I am employed and have never submitted a tax return before- do I need to now?

Mollie, Canvey Island

Although you have no income to tax from your property, you would probably benefit from informing HM Revenue & Customs (HMRC) of the losses, which you can do by submitting a tax return.

This will allow you to then carry forward the losses and offset them against future profits you make from the property. So it could save you tax in the long-term!

Please note, you are obliged to submit a tax return if your gross rents (i.e. the income from the property before deducting any expenses) be over £10,000 per annum. This is irrespective of whether the property is profitable or not.

If you would like some assistance in registering with HMRC and completing your tax return, please feel free to get in touch with your local TaxAssist Accountant.

We provide tax and accountancy services in Canvey Island and throughout the UK - http://www.taxassist.co.uk

What is a P38A?

What is a P38A?I’m in the process of submitting my P35, but I’ve got a bit stuck on one of the questions on the form. What is a P38A?

Declan, Halifax

The P38A is a supplementary return that must be submitted to HM Revenue & Customs (HMRC) if you have answered ‘No’ to question 1 of the P35 form, which is ‘Have you sent a form P14 End of Year Summary or completed and retained a form P38(S) Student employees for every person in your paid employment,either on a casual basis or otherwise, during the tax year shown on the front of this form?’

The P38A is commonly required where you’ve used casual staff during the year, and have paid them cash and not operated PAYE for them. It ensures that HMRC captures the details of everyone that has worked for you; whether they were ‘on the books’ or not- a ‘catch-all’.

If you have paid a worker and they are not ‘on the books’, there are three different reporting requirements depending on the circumstances:

1. If you have paid someone less the Lower Earnings Limit (LEL) which was £102 per week for 2011/12 and you have a P46 from them on which they've ticked box A, just complete the front of the P38A
2. If you have paid them more than the LEL for any period, complete Section A on the P38A
3. If you have paid them more than the LEL in total for the whole of the tax year, complete Section B on the P38A

Your local TaxAssist Accountant would be happy to assist you with the completion of your P35 and the other forms required for submission/ distribution.

We provide tax and accountancy services in Halifax and throughout the UK - http://www.taxassist.co.uk

Can I ignore the P35 I've received?

Can I ignore the P35 I've received?I have received a P35 from HMRC but I don’t think I need to submit one. Can i just ignore it?

Benjamin, Longton

If you think you have received the form in error, you should inform HM Revenue & Customs (HMRC). Otherwise, the department will automatically raise late filing penalties.

To notify HMRC that you do not need to submit the P35, you’ll need your Employer PAYE reference (you’ll find this P35 they’ve sent you) and your contact details. You will also need to know whether you are intending to submit form P11D(b) as well.

You can notify them online at www.hmrc.gov.uk, over the phone with the Employer Helpline on 08457 143 143 or via an agent (such as an accountant).

Your local TaxAssist Accountant would be happy to deal with this on your behalf.

We provide tax and accountancy services in Longton and throughout the UK - http://www.taxassist.co.uk

CIS Tax Refund

CIS Tax RefundI own a small company in construction and some of our customers have been deducting CIS tax from our payments. How do I go about reclaiming this?

Sam, Ilford

If you have employees from which you have deducted PAYE and National Insurance (NICs), you may offset the CIS deducted by your customers from the amount you are due to pay to HM Revenue & Customs (HMRC) each month/ quarter. HMRC offer Form CIS132 to keep a record of how much CIS deductions have been offset.

Please note, if your CIS deductions exceed the amount of PAYE and NICs due, you cannot claim a refund. You must instead carry forward the surplus to the next payment you are due to make to HMRC.

You will need to enter the total CIS deductions taken on the P35 Employer Annual Return too, which is due at the end of the tax year by the following 19 May. HMRC will repay the company any balance of deductions that your company was not able to offset during the year.

Please note, only companies can use the P35 to recover CIS deductions taken from payments; not individual subcontractors or partnerships.

If you don’t feel confident dealing with, please feel free to get in touch with your local TaxAssist Accountant who would be happy to help you with this.

We provide tax and accountancy services in Ilford and throughout the UK - http://www.taxassist.co.uk

PAYE refund

PAYE refundI was put on an emergency tax code because my old employer has been slow to provide me with my P45. How do I go about getting the correct tax code and get my tax refunded?

Isobel, Altrincham

You should obtain your P45 from your old employer as soon as possible. Your new employer can then complete their sections and send the appropriate part off to HM Revenue & Customs (HMRC). Once HMRC have processed the form, they should issue you with a new tax code.

Unless the tax year in which there is an issue has finished or you’re unemployed again, it’s unlikely that you need to physically request a refund. Using your new tax code, your new employer should correct your tax deductions moving forward and will also refund any overpaid tax. So you should see an increase in your net pay when your new tax code comes through.

Feel free to contact your local TaxAssist Accountant if you would like to discuss this further.

We provide tax and accountancy services in Altrincham and throughout the UK - http://www.taxassist.co.uk