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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.

 

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What our clients say

Dakins Property Services

Great Results, Personable, High Integrity

Choice Events Limited

All at Beauchamp Charles are very helpful, approachable and easy to talk to. They keep me informed with key dates; I can feel totally confident that I won't ever miss any deadlines! Whoever I deal with, always deal with matters professionally and efficiently and if they are unavailable they get back to me promptly.

FT leisure Ltd

I have worked with Beauchamp Charles as our management accountants for over 20 years and have never received anything less than exceptional service. Their approach is both professional and personal. Finances and particularly tax strategies are a minefield for small businesses; Beauchamp Charles have in-depth knowledge of these area, which is comforting. They pay very close attention to our business activities and have provided financial strategies that have helped our company develop.

Fredrick Thomas Electrical and Maintenance

We have used Beauchamp Charles since company formation back in 1998. Beauchamp Charles offers us a one to one service as they are small enough to offer this dedicated service and large enough to do the work and offer best advice. They get to know us as individuals and a business, always giving sound advice. Frederick Thomas Electrical are in a stronger place thanks to the service we get from them.

Barnes Walker Landscapes Limited

We are a small business and had employed the same accountancy firm for many years. Two years ago we took the decision to switch to Beauchamp Charles after several othe local businesses recommended them very highly to us. We have not been disappointed with the service they have provided to us over these last two years.