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June Question and Answer Corner
Newsletter issue - June 07.
Q. I started a new business last year and have only just begun to make profits after a year of losses. Can I set the losses made in the first year against the profits made in the second year?
A. Yes you can, but if your business is run as a sole-trader rather than through a company you can set the first year losses back against your other income made in the four years before you started the business. If the business is operated through a company the use of losses is more restricted as they can only generally be set against income made by the same company in the future.
Q. Before I married I lived in a small flat, which is now let. I would like my wife to receive the income from this flat to use up her personal tax allowances, as she is no longer working. How can I arrange this?
A. To share the income from the flat the property must be held in your joint names. Ask a solicitor to transfer ownership of a defined share in the property to your wife. There will be legal charges and possibly Stamp Duty Land Tax to pay if the property is subject to a mortgage.
Q. I am setting up a café in a local gym to sell hot and cold drinks including fruit smoothies made on the premises. Do I have to charge VAT on the smoothies?
A. Assuming you are or need to be registered for VAT, then Yes. Smoothies and juices are a drinks subject to standard rate VAT. If you sell the fruit unprocessed it is a zero-rated food.
Charities & Not For Profit
We have been providing charity clients with high quality, specialist advice and service for many years, and our charity clients range from small village halls to large national organisations...
Farming Industry
The largest industry sector that we deal with is farming, as you would expect in a rural practice. This means that we have developed considerable expertise in this field...
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