Chapter 15 - Taxable total profits Flashcards
Do we have adjustments for private use?
No - if they state the directors or employees have private use the full amount (BIK)
Give two examples of trade interest paid
Examples
- Bank overdraft interest
- Loan interest on plant and machinery
Give three examples of Non-trade interest paid
Examples
- Loan interest on properties
- Loan interest on shares
- Loan interest on investments
Give an example of trade interest received
Late payment of sales
Give two examples of Non-trade interest received
Examples
- Bank interest received
- Loan interest received
On what basis do we calculate the profits on rental properties for Ltd companies?
Accruals basis
Sole traders default to cash basis
Give two examples of property income not allowable
- Capital/new/improved
- Depreciation
How do you split/when is the tax treatment
Trading profit before capital allowances
Between the chargeable accounting periods?
Time apportionment
How do you split/when is the tax treatment
Capital allowances
Between the chargeable accounting periods?
Separate calculation for each CAP
How do you split/when is the tax treatment
Non-trade interest
Between the chargeable accounting periods?
Accruals basis if you have the information, otherwise time apportionment
How do you split/when is the tax treatment
Property income
Between the chargeable accounting periods?
Time apportion
How do you split/when is the tax treatment
Chargeable gains
Between the chargeable accounting periods?
Where disposal date falls
How do you split/when is the tax treatment
Qualifying charitable donations
Between the chargeable accounting periods?
Where payment date falls
State the property income proforma
Rent accrued X
Less: allowable expenses (wholly and exclusively)
Insurance (X)
Agent fees and other management expenses (X)
Repairs / replace / renewal / redecorate (X)
Irrecoverable debts (X)
Pre-letting expenditure ( 7 years ) (X)
Assessable property profits X
State the interest income proforma
Bank and building interest receivable X
Gilt-edged security interest receivable X
Loan note interest receivable X
Less: Loan interest on let property paid (X)
Loan interest on shares paid (X)
Non-trade loans written off (X)
Interest income X
When you calculate total taxable profit. What do you do with…
Dividends paid
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Non-trade interest
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Bank/Overdraft interest
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Loan interest
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Plant and machinery interest
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Capital / New / Improved
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Loss on sale of non-current asset
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Depreciation
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Car Leasing when emissions exceed 110g/km, 15% disallowed
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Donation payment under Gift Aid
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Subscriptions political
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Non-charitable gifts
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Trade subscriptions
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
National charity donations
Add back (disallowable expenditure)
Allow if local donations with
promotion of the business
name
When you calculate total taxable profit. What do you do with…
Entertainment, customers, suppliers
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Employee entertainment
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Gift to customers
Add back (disallowable expenditure)
unless
1.Cost less than £50
2.Not food, drink, tobacco, or
voucher
3. Carries the company name
When you calculate total taxable profit. What do you do with…
Fees associated with acquiring new non-current assets
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Legal fees chasing debts
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Registering patents
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
The write-off of an NON-trade debt (eg a loan to a customer or a former employee)
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Write off of TRADE debts
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
New lease
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Renewal of lease
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Fines
Add back (disallowable expenditure)
When you calculate total taxable profit. What do you do with…
Employee fines
Deduct (allowable expenditure)
When you calculate total taxable profit. What do you do with…
Interest income
Deduct
When you calculate total taxable profit. What do you do with…
Dividend income
Deduct
When you calculate total taxable profit. What do you do with…
Property income
Deduct
When you calculate total taxable profit. What do you do with…
Profit on sale of a non-trade asset
Deduct
