I.

VAT
Taxable supplies: zero rate, reduced rate (6%), standard rate (20%)

Zero rated Exempt

-Food (trừ supple in the course of catering EX - Land: not buildings

restaurant, or luxury items EX alcohol,
confectionary) - Insurance: premium

-Books and other printed matters
-Construction of dwellings: except restruction
-Transport: exclude smaller vehicle EX taxis
-Drugs, medicine, appliances
-Charities
-Clothing & footwears: for young children
- Financial services: making loan, hire purchase, share
dealing, banking services
- Education: provided by schools, universities
- Health: not health farms
- Sports: entry fees to sports competitions used to provide
prizes or charged by non – profit sporting bodies

The value of a supply

1.Discounts
If a cash discount is offered, then VAT must be calculated as if the maximum discount available was taken.
2.Goods for own use
Where the trader withdraws goods from the business, output VAT must be accounted for on the replacement
value of the supplies
3.Gifts
Gifts of stock or fixed assets are treated as taxable supplies at replacement value, except gifts of:
goods to the same person which cost the trader £50 or less in a 12-month period
samples, unless the recipient is given more than one sample of the same item.
Gifts of services are not taxable supplies.
Recovery of input VAT
Conditions for obtaining input VAT relief Input VAT is recoverable
on goods and services which are use for business purposes.
A VAT invoice (see below) is needed to support the claim Irrecoverable input VAT
Input VAT on the following goods and services cannot be recovered:
Business entertaining, although VAT incurred on staff entertaining is recoverable and entertaining overseas
customers is recoverable
Cars, unless they are :
100% used for business purposes, e.g. driving school cars→ 100% recoverable available
Leased: 50% of input VAT is recoverable Private use Input VAT can not be claimed
Goods or services are used partly for private and partly for business purpose→ an appropriate
apportionment is made to calculate the recoverable input VAT- except motor expenses.
Relief for impaired debts
The following conditions apply: At least 6 months must have elapsed since payment from the debtor was due
The debt must have been written off in the seller’s VAT account.
Relief is obtained by adding the VAT element of the bad debt to the input tax claimed.
Claims for bad debt relief are subject to a three-year time limit.
II. Property income
Property business profits arising The premium Furniture holiday Rent a room scheme
from rental/lease property received on the accommodation
grant of a short
lease (≤ 50 years)
Rental income received Premium*(51-n)/50 Finance costs are TH1: Rent paid < 7,500: giảm trừ
Less: Related rent paid fully deductible 3,750
Assessable income TH2: Rent paid > 7,500:
Lower
II Employment income
Salary + Bonus/Commission + Benefits + Reimbursed expense + Cash vouchers
Less: Allowable deductions:
- Expenses incurred wholly, exclusively and necessarily
- Contributions to employer’s occupational pension scheme
- Subscriptions to professional bodies
- Charitable donations: payroll deduction scheme
- Travel and subsistence expenses
- Use of own car – mileage allowance (S/s actual & standard)
Employment income
Special benefits General benefits (exempt)

1.Vouchers, credit tokens - Trivial benefits (exclude vouchers): < 500

2.Living accommodation
Not – job related
Job – related: 10% net earnings
3.Motor car (contribution -> list price (<5,000))
4.Private fuel (24,100*appropriate percentage)
5.Vans: Taxable benefit = 3,430
Private use is insignificant -> No benefit arises
Private mileage -> benefit = 655
No CO2 emission -> benefit 2,058
6. Beneficial loan: loans < 10,000 -> no benefit
arises
Thỏa mãn reliefs -> no benefit arises
7. Use and gifts of assets
- Employer rent
- Employer’s contribution to a registered pension scheme
- Restaurant, canteen facilities provided to all employees
- Car parking space at/near place of work, including the
reimbursement of the cost of such parking place
- Provision 1 mobile phone for private use by employee
- Encourage employees go to work not by car
- Christmas parties, annual dinners dance for all staff (≤
150 each)
- Nursery for childcare
- Relocation and removal expenses ≤ 8,000
- Overnight business by employees: ≤5/night; ≤10/overseas
night
- Work at home expenses ≤4/week; ≤8/month
- Loan (≤ 10,000) with beneficial interest rate
 Higher: Rental paid by employer and 20%*MV - Provision of job - related accommodation
-Gift of assets - Medical treatment for employee to return to work ≤ 500
8. Living accommodation expense - Quà tri ân phục vụ cty > 20 năm ≤50/year

III. Trading income

Net profit per accounts Disallowable expenses
Add back: - Not wholly and exclusively
- Expenditure not allowed for - Appropriations (withdraw funds: interest paid to owner on
taxation purposes capital invested in the business, salary/drawings taken by a
- Expense allowable for taxation sole trader or partner; any private element of expense relating
purposes to the owner’s motor car, telephone)
- Taxable trading profit not credited - Excessive salary paid to family member
in the accounts - Interest payable (capital gain tax. Late paid income tax,
repayment interest rate by HRMC)
- Capital expenditure (dep, loss on sale of NCA, improvement)
- Car leasing (110g/km, 15%)
- Donation
- Entertaining and gifts
- Legal and professional charges (acquire new NCA)
- Impairment losses (write off of non-trade debt: loan to a
customer or a former employee)
- Trading income not included in P&L: removal of goods for
own use
- CP diễn tra trc khi kdoanh bắt đầu (<7 years)
Less:
- Expense not charged in the
accounts but allowable for taxation
purposes
- Income included in the accounts
that is not taxable as trading profit
- Capital allowances
- Short lease premium
(Premium*(51-n)/50
Tax adjusted trading profit
Other items are allowable: - Provision for future costs, compensation for loss of office paid to employee (for
benefit of trade), redundancy pay in excess of the statutory amount (3*statutory amount), counselling services
for redundant employees, damages paid, defalcations (by employee), educational purposes, pension
contribution to registered pension scheme, premiums for insurance against an employee’s death or illness,
removal expenses, salaries accrued at year end)
IV. Capital allowance
1. THE GENERAL POOL
Most items of plant and machinery purchased are included within the general pool.
2. THE ANNUAL INVESTMENT ALLOWANCE (AIA)
The key rules for the allowance are: Available to all businesses regardless of size, Available on acquisitions of
general plant and machinery and acquisitions of “special rate pool” items, Not available on any cars, Limited
to a maximum of £ 1,000,000 expenditure incurred in each accounting period of 12 months in length, For long
and short accounting periods the allowance is pro- rated, For long and short accounting periods the allowance
is pro- rated, Not available in the accounting period in which the trade ceases.
3. FIRST YEAR ALLOWANCE (FYA) – low emission cars
A 100% first year allowance (FYA) is available on low emission cars (CO2 emissions
<=50g/km), irrespective of date of purchase:
In the period of acquisition, a 100% FYA is given instead of the writing down allowance (WDA)
The FYA is never pro-rated for accounting period of greater or less than 12 months
FYA are not given in the final period of trading
4. WDA
An annual WDA of 18% is given on a reducing balance basis; the unrelieved expenditure in the pool brought
forward at the beginning of the period of account (i.e. tax written down value (TWDV); any additions on
which the AIA or FYA is not available, plus any additions not covered by the AIA (exceed the 1,000,000
limit); after taking account of disposals
The TWDV brought forward includes all prior expenditure, less allowances already claimed.
V. CAPITAL GAIN TAX (CGT)
Chargeable disposal Exempt disposal

1. sale or gift of the whole or part of an asset 1. disposal as a result of the death of an individual
2. exchange of an asset 2. gifts to charities
3. loss or total destruction of an asset
4. compensation & receipts
Chargeable assets Exempt assets

1. Freehold land & buildings 1. Motor vehicle (include vintage car)

2. Goodwill 2. Main residence
3. Unquoted shares 3. Cash
4. Quoted shares 4. Chattels
5. Chattels 5. Investment held within ISA
6. QCBs
7. Gilt – edged securities
8. NS&I certificates
9. Foreign currency for private use
10. Receivables
11. Trading inventory
12. Prizes and betting winning
Allowable expenditure allowable deductions: cost of acquisition, CP nâng cấp cải tạo, tiền duy trì, CP
bảo kê, incidental coss arising on the acquisition of the asset
Wasting chattels (exempt except Non – wasting chattels exempt when cost, sale < 6,000
plant&machinery thỏa mãn capital allowance) - > 50 years
- Not > 50 years
Greyhound, boat, plant & machinery, racehorse Antiques, jewellery, paintings

VI. TAXABLE TOTAL PROFIT (TTP)

1. Differences relating to companies
The main differences are in relation to: Private use adjustments, Interest payable/receivable, Dividend
payable, Capital allowances
Interest payable/receivable: loan relationship rules: any interest payable relating to trading activities, will
be allowable deduction against trading activities, no adjustment required; Any interest relating to non-trading
activities, must add back to trading profit; Any interest receivable must be deducted from trading profit.
Dividend payable: is appropriate by company, not a trading expense.
VII. GROUP OF COMPANIES
Two companies are associated with each other if either: One of the companies in under the control of the
other; or They are both under the control of the same person or persons (company, individual or a partnership)
Control: 1. Ownership of over 50% of issued share capital, or 2.Holding over 50% of the voting rights, or
3. Entitlement to over 50% of the company’s distributable income, or 4. Entitlement to over 50% of the
company’s assets, if the company were to wind up.
Tax implication: The upper and lower limits, used to determine the rate of corporation tax, are divided by the
number of associated companies. Intra-group dividends (Both UK and overseas) are not treated as franked
investment income, for the purposes of calculating the company’s augmented profits. Only one annual
investment allowance (maximum 200,000 p.a) is available for the group.
GROUP RELIEF GROUP:
GROUP RELIEF GROUP: 75% CAPITAL GAINS GROUP

Company are in a capital gain group if:

Group loss relief is available to members of a 75% group relief
group. Losses of one member of the group can be surrendered to
other group companies, to utilise against their own taxable total
profits
Definition of a 75% group relief group
For one company to be a 75% subsidiary of another, the holding
company must have:
At least 75% of its ordinary share capital of the subsidiary, A right
to at least 75% of the distributable income of the subsidiary , and A
right to at least 75% of the net assets of the subsidiary were it to be
wound up.
2 companies are members of a 75% group where: one is a 75%
subsidiary of the other, or both are 75% subsidiaries of a third
company.
At each level, there is a 75% holding, and
The top company has an effective interest of
over 50% in the group companies.
NOTES:
a company which is a 75% subsidiary cannot
itself be a “parent company ” and form a
separate gains group.
While applying the 75% test, the shares help
by overseas companies can be taken into
account.
The 75% requirement only applies to the
ordinary share capital.
Implications of being in a 75% capital
gains group
Assets are transferred at nil gain/nil los
Capital gains and capital losses can be
transferred around the group
 Roll-over relief is available on a group basis
75% group relief group For sub-subsidiaries to be in a group, the
Transfer of assets within a group
holding company must have an effective interest in the sub-
Assets transferred within a gains group are
subsidiary at least 75%
automatically transferred at nil gain/nil loss
A 75% group may include non-UK resident companies. The transfer is deemed to take place at a price
that does not give rise to a gain or a loss
However, losses may generally only be surrendered between UK (original cost plus indexation allowance to
resident companies. the date of the transfer)
Implication of being in a group relief group The transferor’s deemed proceeds figure is
also the deemed cost of the acquiring
Losses of one group company may be surrendered to other company
companies in the group When the acquiring company sells the asset
The recipient company can then relieve the losses against its own outside of the gains group, the chargeable
TTP. gain/loss arises on the disposal in the normal
way.
A loss may be surrendered by any member company to any other
member of the same group, provided they are UK resident.
Mechanics of group relief
The losses which may be surrendered are: Trading losses,
Unrelieved gift Aid donations, Unrelieved property business losses
Only current period losses are available for group relief
Excess Gift Aid donations should be surrendered before excess
property business losses
Capital losses cannot be surrendered to group companies under
these rules.
The maximum loss that can be surrendered = Lower of:
Loss in the surrendering company for the corresponding accounting
period
TTP in the claimant company for the corresponding accounting
period