Q. My family business is very traditional; the factory-floor workers are paid weekly, the management are paid monthly and the senior directors are paid quarterly. How will I report all these different pay dates under real time information (RTI)?

A. This is a problem, as the RTI system was designed on the basis that all employees on the same payroll are paid at the same time. Under RTI you must submit a report for the entire payroll called a Full Payment Summary (FPS), every time the employees are paid. Running the FPS with only say the weekly employees receiving pay will cause errors unless adjustments are done for those employees who are not being paid on that particular pay date. A solution may be to segment your payroll into weekly, monthly and quarterly runs, but you need to talk to your payroll software provider to check if that is possible, before you start to implement RTI.

Q. I run a small B&B which has three let bedrooms, my family uses the other two bedrooms of the property. How should I calculate how much of the property's running costs relate to the B&B business?

A. The answer is to include all of the property's running costs (power, rates and repairs) in your B&B accounts and take out, or 'disallow', an amount that relates to your family's use of the property. This is called a private use adjustment. In many towns the private use adjustment for B&Bs has been agreed locally with the Inspector of Taxes as a monthly or annual rate. However, from 1 April 2013 national rates of private use adjustment have been set by the Taxman as follows:

- 1 family member living in the premises: £350
- 2 family members living in the premises: £500
- 3 or more family members living in the premises: £650

Q. The Taxman has sent me a new PAYE code for 2013/14, which includes about £1000 of savings income taxed at 40%. I don't know how he got that figure as I don't have any savings, and I only draw dividends from my company up to the limit of the 20% tax band.

A. The Taxman has looked at the income reported on your tax return for 2011/12, of say £7,475 wages plus £35,000 gross dividends (total £42,475), and assumed you will continue to receive the same amounts of wages and dividends in 2013/14. However, in 2013/14 your tax free personal allowance will be £9,440 and the limit of the 20% tax band will be £32,010 (total £41,450). If you draw the same amounts from your company in 2013/14 as you did in 2011/12, you will be taxed on £1,025 at the higher rate (40% for salary, 32.5% for dividends). To avoid the higher tax rate you will need to restrict the amount you draw from your company in 2013/14, and tell the Taxman to amend your PAYE code on the basis of your estimated salary and dividends for the year.

Q. I plan to sign over my home to my son to avoid inheritance tax. Is there anything else I should be aware of before I do this?

A. If you continue to live in the property after you have given it to your son, the gift will not be effective for inheritance tax (IHT), so no IHT will be saved. For IHT purposes the property will be treated as belonging to you until you stop using it, so it will form part of your estate on your death and be subject to IHT. There may be a reduction in the IHT due if your son also lives in the property and pays his share of the running costs.

If you son does not live in the property there may also be capital gains tax charges when he comes to sell the property. We need to discuss this plan in detail with both of you before the gift goes ahead.

Q. I sold a property in August 2012 which made a gain of £50,000. It consisted of a cafe on the ground floor which I ran as a sole trader until August 2010, and a residential flat above, both of which were let out from August 2010 until the date of sale. Can I claim entrepreneurs' relief on the gain?

A. Assuming you ceased the cafe business in August 2010 (and did not continue the same business elsewhere), you should be eligible to claim entrepreneurs' relief on the part of the gain that relates to the cafe section of the property. This is on the basis that the ground floor was used for the purpose of your cafe business to the day you ceased to operate that business, and you sold the property within three years of that date. The gain relating to the flat will not qualify for entrepreneurs' relief.

Q. I want to buy a new business but the only way I can do that is to increase the mortgage on my house. Will the interest I pay on the extra mortgage be tax allowable for the business?

A. In principle yes, but there are restrictions to prevent improper use of this tax relief. Further restrictions are also proposed from 6 April 2013 (see above). Interest paid on loans used to buy into a partnership or to buy shares in a closely controlled company, or lend to such a company are generally tax allowable. However, it would be best to have a separate loan for this business investment, as when you repay any part of the mortgage the business part will be deemed to be reduced first. You will also have to hold at least 5% of the ordinary shares of the company and work for it for the greater part of your time.

Q. My company is doing well and I'd like a new car, possibly a BMW series 5. Should the company lease or buy this car, or does it make more sense for me to take a dividend from the company and to buy the car personally?

A. As the car is available to you for personal journeys you will be taxed on the 'benefit' of driving that car giving rise each year to a tax bill for yourself and a NI bill for your company at 13.8%.

The company will get a deduction against profits for the cost of leasing the car, but that deduction is limited if the car has CO2 emissions over 160g/km (reducing to 135g/km from April 2013). Likewise the capital allowances are restricted for cars with CO2 emissions over 160g/km. The company can pay for the car's insurance, servicing and repairs, with no further cost to you, the driver. However, if fuel is provided there is an additional benefit in kind to be taxed on you.

In reality the calculations need to take into account other factors such as the cost of insurance and whether you need to borrow money to buy the car. We need to talk about this in greater detail to provide you with the correct advice.

Q. The company provides the sales reps with pay-as-you-go mobile phones, who purchase top-ups when they need them, claiming the cost back on expenses. Does the cost of the top-ups need to be included on the forms P11D for those employees? Does it make a difference if the employee bought the pay-as-you-go phone?

A. Where the mobile phone is owned by the company and the contract is between the company and the telecoms provider, any top-ups purchased for that phone are tax free, as the provision of the phone is tax free. The cost of the vouchers does not have to be reported on the form P11D for each employee. Note this tax free treatment only applies to one phone per employee.

If the phone was bought by, and thus owned by the employee, the top-up vouchers are taxable and need to be reported on the form P11D. The employee could claim a deduction on their tax return for the cost of business calls made with the top-up payments, but this would involve analysing all the calls made into business and non-business calls.

If I invest in another commercial let property can I rollover the gain and avoid paying tax on the sale of the lease?

Q. I hold the lease of a property comprising of a shop on the ground floor and offices above. The shop is vacant and only one of the offices is let. I've received a good offer from a property developer to purchase the lease of the whole building. If I invest in another commercial let property can I rollover the gain and avoid paying tax on the sale of the lease?

A. It is possible to rollover gains made on land and buildings used by trading businesses or which are let to trading businesses that are connected to the building owner. However, letting of property is not regarded as a 'trade', so you can't rollover the gain you make on selling the lease of this building. Even if your own trading company occupied a part of the building, rollover relief would only be available on the proportion of the building it occupied.

I've heard that my company can pay up to 1/3 of my gas bills tax-free because I'm working from home, is that true?

Q. My energy bills have soared since I started using a room in my home as the base for my company's business, as I have to have the heating on all the time. I've heard that my company can pay up to 1/3 of my gas bills tax-free, is that true?

A. Your company can pay you (as the company's employee) £3 per week, £156 per year tax free, for working at home and no evidence has to be provided to support that payment.
If you can prove your heating bills increased because you heating the property while working there, when otherwise it would be empty and not heated, then your company can pay that extra heating cost to you tax free. However, if the Taxman asks you will need to provide copies of the gas bills for a period before you worked at home compared to a similar period when you have worked at home, to prove the increase in costs. The Taxman may also want to see a schedule of the days you work at home and days when you work at clients' premises. This type of claim is referred to as 'use of home as office' which can also cover other costs incurred in running your business from home. Contact us for further guidance.

I didn't include the interest from my Swiss bank account on my tax return as I thought it wasn't taxable in the UK. What should I do now?

Q. I've received an alarming letter from the Taxman about a private bank account I held in Switzerland from 2000 to 2005. I didn't include the interest from that account on my tax return as I thought it wasn't taxable in the UK. What should I do now?

A. The Taxman is writing to around 6,000 individuals and organisations that held accounts with a private bank in Geneva, based on a list of accounts stolen from that bank in 2006. Unless you had non-domicile status when you held your Swiss bank account, which may have permitted you to be taxed only on funds brought into the UK, you should have declared the Swiss account on your UK tax return. You need to come clean now, and pay the tax due on your Swiss bank account interest to the UK tax office. If you delay, the Taxman will open a serious fraud enquiry into your tax affairs. Talk to us about how to confess all to the UK tax authorities.

I received a capital payment after I left the UK permanently. Do I have to pay UK tax on the pay-out?

Q. I left London on 5 May 2010 to work full time for a Danish company in Copenhagen. My own UK-based company ceased at that time, and I received a capital payment on 30 November 2010. As I received that money after I left the UK permanently, do I have to pay UK tax on the pay-out?

A. Unfortunately yes. Although you may be regarded as not resident in the UK for income tax purposes from 5 May 2010, you do have to pay UK capital gains tax on the gain made in November 2010. The tax year is not split for capital gains tax, as it can be for income tax. If you are resident in the UK in any part of the tax year, you are taxed in the UK on gains made in that tax year, even if the gain is made after you have left the UK permanently.

Taxman says the tax I owe will be collected by restricting my PAYE code for 2012/13. What does this mean?

Q. The Tax Office has written to me saying £2,800 tax I owe will be collected by restricting my PAYE code for 2012/13. What does this mean?

A. The Taxman is now permitted to collect up to £3,000 of unpaid tax or overpaid tax credits through PAYE codes. Your PAYE code tells your employer how much of your income to treat as tax free, and thus how much tax to deduct from the rest. A common PAYE code for 2011/12 would be 747L, which gives you tax free income of £7,475 for the year. If you owe £2,800 in unpaid tax, and your highest marginal tax rate is 40%, your tax free income will be reduced by £7,000 (£2,800/ 40%), leaving you with tax free income of £475 and a PAYE code of 47L. The numbers will be slightly different in 2012/13, but essentially you will pay more tax each month from April 2012 until the tax debt is eliminated.

I've received a tax refund for 2010/11 but I haven't even submitted my 2010/11 tax return yet.

Q. I've received a tax refund for 2010/11, but I'm worried that it's not correct as I usually have tax to pay each year. Also I haven't even submitted my 2010/11 tax return yet.

A. You are right to be worried about the tax refund, as the Taxman's computer has issued some incorrect refunds recently. If you normally complete a self-assessment tax return but also have some income taxed under PAYE, the computer should wait until your tax return has been submitted before calculating the tax to be refunded. In a few cases this has not happened, and the tax refund has been based only on the taxpayer's PAYE income. Please ask us to check the tax calculation that should have arrived with your refund cheque.

What can he do to get his student loan records corrected?

Q. My son worked for a company that has gone into liquidation. The Tax Office are refusing to acknowledge the student loan repayments which were deducted from his salary in 2010/11 and pass those repayments on to the Student Loans Company. What can he do to get his student loan records corrected?

A. This can happen when the company folds before submitting its end of year PAYE return: form P35. This form shows the totals for all the deductions taken from each employee during the year. Your son needs to provide HMRC with any evidence he has of the student loan repayment deductions, such as original payslips or his form P60 for the tax year. HMRC should then pass this information onto the Student Loans Company who will correct his payment record.

Which PAYE Tax Code is Correct?

Q. My PAYE tax code is 647L, but the websites I've looked at say it should be 747L, which is correct?

A. The personal allowance for individuals aged under 65 for the tax year 2010/11 (which ends on 5 April 2011) is £6,475. If you have no deductions to set against your personal allowance your tax code for 2010/11 should be 647L. The standard personal allowance for the tax year 2011/12 (from 6 April 2011 to 5 April 2012) will be £7475, so your tax code for 2011/12 will be 747L.

How can I maximise tax relief on childcare benefits?

Q. I've heard that tax relief on childcare vouchers is changing from April 2011. How can I maximise the tax relief from this scheme while it lasts?

A. Employers can currently supply their employees with childcare vouchers worth up to £55 per week, which are completely free of tax and NI. However, employees who join the childcare voucher scheme from 6 April 2011 will only be able to receive vouchers worth £28 per week, if they pay tax at the 40% rate. Those employees in the childcare voucher scheme before 6 April 2011 will not have the value of their vouchers limited, and neither will employees taxed at the basic rate of 20%.

To gain maximum advantage from the scheme you need to bring into your childcare voucher scheme as many employees as qualify before 6 April 2011. Unfortunately employees who are not yet parents, or do not have parental responsibility for a child aged under 16, do not qualify to join the childcare voucher scheme. The childcare vouchers can only be used to pay for childcare provided by a registered or approved childcarer.