Year End Tax Review 2010/2011


Lead articles

Looking forward

This year, next year

Rate of change

Pension merry-go-round


Too much NIC

NIC and pensions

Company cars

Tax-free benefits

Childcare vouchers

Business - General

Time to incorporate?

Associated or not?

His and hers

Family bonus

Profit and loss

Show me the money

Can't pay, won't pay?

Turning back the clock

Business - VAT

Standard VAT or flat VAT?

VAT's up again

All Europeans now

A good start for VAT

Happy returns?


Top-up savings

Rainy day money

Capital Gains

Gains favoured

Splitting gains

A place in the country

Holiday lets reprieved


Family fortunes

Where there's a Will

Credits and debits

Benefit going

Piggy banks

Still trustworthy?


Penalty shoot-out

Going online

Paperwork, paperwork

Pay tax later

Opportunity knocks again


Give and save

Non-Domiciled People

Home and away


Interesting times

VAT's up again

By now, anyone running a business should already have dealt with the increase in the standard rate of VAT to 20% on 4 January 2011. The first business day of the new year may not be the best moment to have to change all the prices, but at least we had practised with a similar increase a year before.

As this is the third change of rate in just over two years, most people will be familiar with the problems of a VAT change - but there are still things that can catch you out. If you only account for your VAT when the cash comes in, you have to worry about what appeared on the invoice - if you charged 17.5% in December, then 17.5% is what you owe HMRC, even if you receive the money in January. If you have to issue a credit note, it should carry the same rate as the invoice.

HMRC say that they appreciate the difficulties that businesses go through on a rate change, and will operate a "light touch" where people have made mistakes. Being "touched lightly" by HMRC may still be more than most people want!

Action Point!
Are you confident that you know the rules on changing the VAT rate?