Tax question
#1
Tax question
In the final month of my tax year I was paid up front a lump sum to finance a property purchase as a sort of wage advance from my boss, as I would not have earnt 80% of this money till the next tax year can I declare that amount in the following year tax returns?
Thanks in advance.
Thanks in advance.
#3
It depends...................
Assuming you are an employee and the whole payment has been processed through your employers PAYE scheme with tax and NIC deducted, I think I would agree with MattW.
However, if part of this payment is a loan and documented as such, to be repaid from your earnings post 5th April 2007, I see no reason why it should not be declared as income for the next tax year.
If it is a loan and you don't pay a commercial rate of interest on it you may be liable to a tax charge under the beneficial loan interest rules applicable to employees. This would be calculated by your employer and reported to HM Revenue & Customs on a form P11D if the benefit is above (I think) £200.
If you are self-employed then I suggest you have documentation to support the loan element as explained above.
Assuming you are an employee and the whole payment has been processed through your employers PAYE scheme with tax and NIC deducted, I think I would agree with MattW.
However, if part of this payment is a loan and documented as such, to be repaid from your earnings post 5th April 2007, I see no reason why it should not be declared as income for the next tax year.
If it is a loan and you don't pay a commercial rate of interest on it you may be liable to a tax charge under the beneficial loan interest rules applicable to employees. This would be calculated by your employer and reported to HM Revenue & Customs on a form P11D if the benefit is above (I think) £200.
If you are self-employed then I suggest you have documentation to support the loan element as explained above.
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