August 2021 Newsletter | Cylchlythyr Misol Awst 2021
Historically, self-employed losses could only be offset against other income in the same tax year or the preceding tax year. As a result of the pandemic, self-employed losses incurred in the 2020-2021 and 2021-2022 tax years can now be carried back and set against profits from the last 3 tax years. This provides a welcome relief to businesses which have become loss-making since the pandemic.
Tesco Bank recently announced that it will close all current accounts by 30 November 2021. They are also temporarily declining new requests from customers to change provider as they are currently inundated with requests. Ensure that you research which bank has the best offers on their current accounts when you switch and check that they are an established and regulated bank.
Making Tax Digital for Income Tax is on track to be implemented from April 2023. This will mean that more digital reporting will be required for many businesses and landlords. We will contact each of our clients individually to ensure a smooth transition for everyone affected by the change.
If you are contemplating purchasing a property built in the last 20 years check very carefully if it is leasehold and if so, examine the ongoing annual service charges / ground rent as they can be very expensive.
Recent newspaper reports indicate that some existing purchasers have successfully sued their conveyancing solicitors (often firms recommended by the housebuilders) for not fully explaining the charges involved.
Ask Huw and Aled: As executor for my uncle's estate, I am about to pay an inheritance tax bill on an estate which includes a cryptocurrency portfolio. The value of the portfolio has dropped significantly since he passed away. Can I claim to reduce the tax bill as a result of the drop in the value of the portfolio?
When the inheritance tax forms were completed, a valuation would have been obtained of the cryptocurrency portfolio and the tax bill would be based on this valuation.
Inheritance tax reliefs are available to executors where assets have fallen in value between the date of death and when the asset is sold. This relief applies to the sale of land and quoted shares (subject to specific conditions). Under current legislation, the relief does not apply to cryptocurrencies.
In rare circumstances, this could lead to the inheritance tax bill being higher than the value of the cryptocurrency portfolio.
If you are concerned about the impact of inheritance tax on cryptocurrency portfolios, please get in touch.
