Gaps in NIC records

National Insurance credits can help qualifying applicants fill gaps in their National Insurance records. This can assist taxpayers to build the number of qualifying years of National Insurance contributions which can increase the amount of benefits a person is entitled to receive, for example, the State Pension.

This could happen if someone was:

employed but had low earnings
unemployed and were not claiming benefits
self-employed but did not pay contributions because of small

MTD for VAT – digital records required

The MTD for VAT regime started in April 2019 when businesses with a turnover above the VAT threshold of £85,000 became mandated to keep their records digitally and provide their VAT return information to HMRC using MTD compatible software.

From April 2022, MTD for VAT will be extended to all VAT registered businesses with turnover below the VAT threshold of £85,000. Many businesses with turnover below the VAT threshold have already voluntarily chosen to use MTD for VAT.

If you are using MTD

Tax relief for job-related expenses

If you receive no compensation from your employer for work related expenses you have paid, you can still claim tax relief for some expenses that relate to working from home. HMRC will usually allow you to claim tax relief if you use your own money for things that you must buy for your job, and you only use these items for work. You must make a claim within 4 years of the end of the tax year that you spent the money.

For example, if you use your own uniforms, work clothing and tools for work it

Tax relief if working from home

If you are an employee working from home, you may be able to claim tax relief for some of the bills you pay that are related to your work.

Employers can reimburse employees for the additional household expenses incurred by working at home. The relief covers expenses such as business telephone calls or heating and lighting costs for the room you are working in. Expenses that are for both for private and business use (such as broadband) cannot be claimed. Employees may also be able to claim tax

Spreading the cost of tax bills

One of the announcements by HMRC at the start of the coronavirus pandemic was the introduction of emergency measures to help those affected by COVID-19 using the existing Time to Pay service. Many businesses and self-employed people with outstanding tax liabilities were eligible to receive support with their tax affairs through this service.

Since April 2021, Self-Assessment taxpayers have used the online Time to Pay service to pay more than £310 million worth of tax in instalments. The option

Hobbies and artificial trades

HMRC uses a number of different measures to help determine whether an activity is a trade irrespective of whether the activity leads to a profit or a loss. This includes looking at whether an activity is a hobby or artificial trade.

HMRC manuals implore inspectors to critically examine claims that a trade exists where that claim may have been made to get relief:

that is only available to traders, such as loss relief, or
for the costs of a hobby, or
for investment losses, or
for capital