You often ask about...

What is a NIN, and how to apply for it?

National Insurance Number – NIN is necessary to register a taxpayer in the tax and social system. There are two types of this number: temporary and permanent. The NIN consists of two letters, six digits, and one letter at the end.

Tax year in the UK

The UK's tax year starts on 6 April and ends on 5 April of the following year (in this cycle it is repetitive).

How to choose a company name?

The best place to check the availability of our chosen name is the Companies House Register website.
When choosing a company name, you should consider the following issues:
the name must not be offensive to anyone
it is unacceptable to have the title referring to the Queen and the Royal Family
the name must not contain punctuation marks and symbols
the name cannot incite to commit a crime
the name cannot be similar to existing companies (you can verify it on the Companies House website).

What is a Personal Allowance (PA)?

Personal Allowance is a tax-free amount, updated annually until almost every UK resident is exempt from income tax. For tax year 2019/2020, the tax-free amount was £12500 (the amount concerns the tax year 2020/2021).

What is a Self-Assessments (SA)?

Self-Assessment is an obligation of the self-employed to settle with the tax office from the income obtained in a given tax year. In other words, it is the obligation to determine the income in capacities other than employment (PAYE), where the employer is obliged to automatically calculate and pay tax to the tax office (HMRC). However, there are cases where there is an obligation to submit a Self-Assessment for persons employed under a contract of employment (PAYE).

How do you check LTD company data?

The verification of a LTD company can be considered on several levels. The basis is to check in the Companies House Register such information as registration address, company number, director of the company/management board, or recently submitted company's billing documents. Additionally, there may be a need to verify the company's accounting documents. In this case, it is worth entrusting such an audit performance to a specialist with documented accounting privileges and skills.

Does a self-employed person need a business bank account?

If you are a sole trader or even run a company where two or more self-employed people work in partnership, there is no obligation to use a business account. You are free to use a private bank record, whereby providing a personal account number on the invoices issued to customers for services rendered and receiving payments from customers.

However, it would help if you considered setting up a business bank account.

What is a Unique Taxpayer Reference (UTR)?

Unique Taxpayer Reference is an individual taxpayer number assigned only once in a lifetime. To get this number, you must inform the UK Tax Office (HMRC), e.g., via an online form, when you start a business. To get a UTR number, you must have a NIN number (National Insurance Contribution).

What is a tax residency certificate and how to obtain it?

A tax residency certificate in the UK is a document confirming that the taxpayer's company is located in the UK, and here are paid taxes. In the case of an individual, it is proof of residence address. The HMRC issues this certificate. This document's waiting time is 30 days, but we know from practice that it may take longer.

What is a tax-free amount in the UK?

In fiscal year 2020/2021, the tax-free amount is £12500. In the current tax year, this amount remains frozen due to the bad economic situation, and one of the main reasons is the COVID-19 pandemic.

What is a Construction Industry Scheme (CIS)?

Construction Industry Scheme (CIS) is a legal system introduced by the United Kingdom's tax office (HMRC) that regulates the construction industry's principles in the construction industry between the Contractor and the Subcontractor. It means several formal and financial obligations imposed by CIS on both parties.

What is a virtual office service?

In the simplest form, it is to lend the address where the client can register their business. However, there have developed companies providing prestigious company registration addresses in the business space, which can be very helpful in running a business. Additionally, the virtual office service may include company registration, correspondence address, accounting, or legal services.

What are the VAT rates in the UK?

VAT is calculated in the UK in a completely different way than in EU countries. VAT is a tax on goods and services. In most cases, the standard rate is 20%. There are two other types of VAT rates: reduced 5% and zero 0%. For example, children's clothing has a zero rate, and the standard rate is 20% for adults.

What is an EHIC card?

EHIC or European Health Insurance Card is a UK health insurance card that entitles you to free (or partially reimbursed) primary medical care use in European countries. The right to get this card has, among others, people over 16 years of age working and living in the UK. 
The EHIC card is only valid for short trips, and you can make it by submitting an online application.

What is Payroll?

Payroll is a legal obligation of every employer to keep full employee records. It contains all settlements (current and annual) with employees according to the principles of PAYE (Pay As You Earn), a system that collects income tax and social security contributions by the tax office (HMRC).

What is a Capital Gain Tax (CGT)?

Capital Gain Tax (CGT) is a tax on capital income, meaning profits resulting from sales, donations, shares, and stocks in a company and transfer or exchange of real estate. A taxpayer is entitled to the so-called Annual Tax-Free Allowance (CGT) on account of capital gains, thanks to which the CGT is paid only on profits that exceed the tax-free amount.

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