Here are the most frequently asked questions we've received from self-employed clients in January 2022, with answers from the experts at Orange Genie Accountancy:
Can I buy a van through the company?
Yes and this can be very tax efficient. You would need to ensure that the van is purchased, and all documentation is in the company name. Your company can reclaim the full VAT on the purchase price of the van - even if it's on the flat rate VAT accounting (if the van costs over £2,000 when purchased new). Unlike with a company car, a van qualifies for annual investment allowance, meaning you can deduct the FULL value of your van from company profits. You need to be aware that if you use the van for personal use then it will give rise to a benefit in kind charge.
How are the Scottish tax rates different?
Bands | Band name | Rate |
£12,571* - £14,732 | Starter Rate | 19% |
£14,733 - £25,688 | Scottish Basic Rate | 20% |
£25,689 - £43,662 | Intermediate Rate | 21% |
£43,663 - £150,000** | Higher Rate | 41% |
Over £150,000** | Top Rate | 46% |
* assumes individuals are in receipt of the Standard UK Personal Allowance.
** those earning more than £100,000 will see their Personal Allowance reduced by £1 for every £2 earned over £100,000.