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We've scoured the web to get you the most up-to-date advice which includes the most useful tools on offer from the officials themselves.

Effective tax planning is essential if you are to minimise your tax bills. Simple tax planning can significantly reduce your tax liabilities.

The self-assessment tax return is an unavoidable burden if you are liable for self-employed tax or have complicated income tax affairs.

Corporation tax is charged on a company's profits. If you trade as a limited company, ensure that paying this tax is as painless as possible.

National Insurance Contributions (NICs) are payable whether you are self-employed or employed by your own company, although different rates apply.

As well as your legal obligations, you’ll want to ensure that payroll is painless and that you use any opportunities to improve your tax-efficiency.

VAT

Effective VAT planning aims to ensure that VAT is relatively painless, and that you are reclaiming as much as possible of the VAT you pay.

Capital gains are made when you sell something for more money than you paid for it. As a result, you can be subject to tax. Take professional advice.

Business property taxes apply to businesses with commercial premises.There are two commercial property taxes: business rates and stamp duty land tax.

If you have tax problems or face a tax investigation, it pays to seek professional advice and you must act rather than just hoping for the best.

"Breathing space" for 1.4 million firms with Bounce Back Loans

9 February 2021

Chancellor Rishi Sunak has announced new flexible repayment options for more than one million businesses that have taken out Bounce Back Loans during the pandemic.

The new repayment terms - billed as Pay as You Grow (PAYG) - will be available to over 1.4 million businesses, which collectively took out nearly £45 billion through the Bounce Back Loan Scheme. PAYG will allow borrowers to tailor payments according to their individual circumstances.

Under the original Bounce Back Loan Scheme terms, no repayments or interest are due from the borrower during the first 12 months of the loan term. With this new support, businesses will now be able to:

  • extend the length of their loans from six to ten years (reducing monthly repayments by almost half)
  • make interest-only payments for six months
  • or pause repayments for up to six months

The chancellor has also extended the flexibility of the third option, which will now be available to all from their first repayment, rather than after six repayments have been made. It means that businesses can choose to make no payments on their loans until 18 months after they originally took them out.

The government says that lenders will proactively reach out to borrowers to provide information on repayment schedules and explain how to access flexible repayment options.

"Businesses are continuing to feel the impact of extended disruption from COVID-19, and we're determined to give them the backing and confidence they need to get through the pandemic," said chancellor of the exchequer Rishi Sunak. "That's why we're giving Bounce Back Loan borrowers breathing space to get back on their feet, through greater flexibility and time to repay their loans on their terms."

However, Funding Xchange has warned that although the new support will help many firms, others will still struggle to repay their loans. In fact, its analysis suggests that more than half of the 1.4 million Bounce Back loans made will be unaffordable.

Funding Xchange is a government-approved online referrals platform for businesses looking for alternative finance when their main banks have declined their loan application. The platform captures data and uses open banking functionality to forecast the capacity of businesses to be able to service their borrowings.

"Extending the repayment period from six years to ten years will have a positive impact on around one in five of the businesses," said Katrin Herrling, co-founder and ceo of Funding Xchange. "We still forecast that more than half of the businesses who have used the scheme may be unable to repay. Many are already distressed and the 46% of borrowers who had no prospect of being able to repay anyway will still not be able to repay."

At the moment, Funding Xchange data suggests up to two-thirds of businesses with Bounce Back Loans are experiencing repayment stress. "Several other nations are implementing debt forgiveness scheme for distressed businesses - we encourage the government to carefully examine these alternative solutions that might offer better value to taxpayers, businesses and banks," said Herrling.

Written by Rachel Miller.

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