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Supplying goods to the Isle of Man and Jersey

Q: I have been approached to supply my products to customers who are in Jersey and the Isle of Man. Presumably as they are both part of the UK, I will have to charge VAT? The reason for asking this is that I seem to think that the Channel Isles offer VAT free shopping.

A: Although both the Channel Isles and the Isle of Man are part of the UK, they currently have different VAT status. The Isle of Man is considered to be part of the UK and thus subject to UK VAT . The Channel Isles however are outside of the UK for VAT purposes and thus make their own rules.

Consequently anything you supply to a customer in Jersey is considered to be an export outside of the UK and VAT is not charged.

A: For each employee they will need full name, address, gender, tax code, date of birth, national insurance number, national insurance letter, gross pay to date, tax paid to date and the totals from columns 1a to 1e on the from P11 that I assume you use to currently calculate.

The bureau of your choice should send you a pro forma to use. It would be sensible to get this two or three weeks before the change over so that you can collate the information required. Make sure that you can get changes to them in good time for the payroll to be processed.

A: If you supply certain types of goods or services to disabled people then the supply can be zero rated, and no VAT needs to be charged. The following services may qualify for relief: installing zero-rated equipment which has been designed solely for use by a disabled person

• adaptation of goods to suit a disabled person condition
• repair and maintenance of equipment designed solely for use by disabled people
• certain building alterations.

There are 3 conditions must be met in order for these services to qualify for zero rating and your accountant will be able to supply further details.

A: Yes, relief is available in this way, but you must first offset the trading losses against your total income for the tax year, and any excess can be extended and set against your chargeable capital gains for the tax year.

If you do not have any other income in the tax year this will result in a relief of £20,000 being claimed against the capital gain on your property of £50,000, leaving a chargeable gain before other reliefs and annual exemption of £30,000.

This will result in a significant fall in your Capital Gains Tax liability and your local TaxAssist Accountant can advise how to make the claim.

A: To qualify for maternity leave and Statutory Maternity pay, a woman must be an employee, that is to say, she must work under a contract of employment. In the same way that individuals who are self-employed are not bound by statutory legislation on, for example, sick leave or holidays, any period of leave to cover the birth of a baby will be a matter of personal decision.

However, as a self employed person you may be able to claim Maternity Allowance (as opposed to the Statutory Maternity Pay due to employees) to fund the period that you will not be working. Maternity Allowance currently pays a standard weekly rate of £117.18 or 90 per cent of your average gross weekly earnings (before tax), whichever is the smaller. It is paid for a maximum of 39 weeks.

Visit website www.direct.gov.uk for more information, or contact your accountant or local jobcentre plus office for further details.

A: Payments on account represent 50% of the individual’s net tax liability for the previous year. All individuals are liable to make these payments unless their net tax liability is less than £500 or more than 80% of the tax due was deducted at source. If you do not make these payments on the due date you will be charged interest.

Given that you have had a poor trading period your taxable profits is likely to be significantly less than the previous tax year which the payments on account are based on, you can claim to reduce these payments. The amount that you reduce these too should reflect the estimation of your taxable earnings for tax year.

However, if it is later found that you have overestimated the fall in your income, and consequently reduce the payments on account by to much, you will be liable to pay interest on the difference between the amounts paid as payments on account and the amount due. Equally if you have underestimated the fall, you will be due a refund on the amounts overpaid and will receive interest.

A: You can only receive redundancy payments if you are an employee working under a contract of employment whether written, verbal or implied. As you were presumably a director of the company, you will only be classed as an employee if you work under a contract of employment.

Also, directors do not qualify if they only have a controlling interest in the company. Therefore, for you to qualify you need to have a 50% shareholding or less in the company, and be working under a contract of employment, so that your relationship to the company is similar to that of other employees.

Directors also do not qualify if they deal only with company policy and go to board meetings in return for fees. Equally Self-employed people and members of a partnership do not qualify for redundancy pay either.

A: HM Revenue & Customs publishes a deemed fuel only mileage rates in addition to the authorised mileage rates.

New fuel only rates ranging between 7p and 21p per mile were introduced on 1 July 2008 and are available on the www.hmrc.gov.uk website. These rates are dependant on the type of fuel (Petrol, Diesel, LPG) and size of engine (1400cc or less, 1401cc to 2000cc, Over 2000c).

If you are using the authorised mileage rates, you can only claim back the input VAT on the “deemed fuel element”. Also remember you must ensure, under rules introduced in Jan 2007, your employee submits a valid VAT receipt with their mileage expense claim for the amount of VAT reclaimed using this method.