Everything You Needed to Know About UK Tax – Part 1

Tax and Everything You Needed to Know

There are two things in life that are certain, according to Benjamin Franklin, “Death and Taxes”! He’s right of course, you won’t avoid either, unless you have a cryogenics program under way!! Tax is tax is tax and if you work here in the UK, you will pay it. Current rates are quite similar to other G7 countries, but will be set to rise to pay for the recent pandemic and make no mistake, they will go up.

Tax and Everything You Needed to Know – Part 1

Where and when did taxes begin?

We need to go back to Doomsday times when taxes on a National level were first introduced in this country. They’re mentioned in the Magna Carta and were originally collected in the first week of the Calendar month of January, as it made sense to have the start date at the beginning of the year. Wrong!! What happened in the first few years was a disaster for the King at the time. Most tax collectors were mugged, this being primarily due to them collecting vast sums of money and doing it mainly in the dark January days, so they were a sitting target for thieves. One bright idea later and yes, the tax year and therefore the collection of taxes began on April 6th  Why not the 1st April? Hmm April fool’s day? Okay, the 2nd April then? Okay ,we just don’t know exactly why the sixth, but it was all to do with the extra daylight when days were longer and mugging just didn’t figure as well! Hence our tax year in the UK begins on the 6th April and ends on the following 5th April. Quite soon it led to the reduction of sore headed collectors getting their brains mashed for a few shackles.

The “Window Tax”

Strange things were taxed in the early days. In Belgium for example, the ruling classes decided to bring in a “Window tax”, so the more windows you had in your humble residence, the more tax you paid. Suddenly there was a rush on boarding up your windows and therefore saving yourself some tax. This is where the saying “Daylight Robbery” stems from.

In Italy, many of the masses avoided paying taxes altogether, citing various excuses, but anything to get out of paying their dues. After many years of painful processing of each and every individual, which was unworkable, given that many didn’t even have second names, a lightbulb moment went on in the governing parties and they decided to tax Salt!! Yes, salt had a hefty levy placed on it, as everyone in Italy used it to cook their pasta, tax revenues shot up and they’ve never looked back!

You can earn a relatively small amount of income and not pay tax on it

So presently here in England and Wales, you can earn a relatively small amount of income and not pay tax on it. But this covers around 8% of the population who are considered on low income. Rising up the ladder, means the rates go up and if you are lucky enough to earn in the top rates of tax, you get to complete an actual Tax Return every year. This has to be filed by the following 31st January and any tax due has to be paid on that date. And to make you feel even more special, Her Majesty’s Revenue and  Customs (HMRC – AKA the Tax Office), ask for another “half” of your liability again, up front on the same date, so you get to pay in  advance, marvellous! But look, don’t do the Tax Return on your own, it’s a massive document and it needs to be correctly completed, otherwise you will face penalties.

Let us file your self assessment tax return for you

Working out your own taxes

So we get the treasured aspect of having to work out our own taxes, put together our own tax return, pay it over and that’s that. To encourage you to do so, HMRC has a new robot that churns out penalty fines for late and non-submission of Tax Returns, so really, there’s no escaping and it is always best to get things submitted on time. We at Taxback.co.uk can help you do that, take care of everything and you can then uncork a bottle of something, sit n]back, relax and know full well that everything is being taken care of by us lovely fluffy people down at taxback.co.uk.

Chat to the fluffy people about how much tax you could be owed 

HMRC recognise that you will possibly have lots of legitimate expenses that help you make your living

Let’s Talk Self Employed Tax Returns

To help you in the daily drudgery of paying your way in tax, it’s not all one-way traffic and HMRC recognise that you will possibly have lots of legitimate expenses that help you make your living. And bless them, they are prepared to let you set that against your earnings, thus reducing your tax bill. It’s a great system, but there are many, many things that go unclaimed. 

Taxes that goes unclaimed

For example, let’s say you are an engineer in a factory, working with metal on a lathe day in day out. You’re an employee and therefore your employer meets all the costs for you to enable you to do your job. You don’t have to provide your own lathe, or uniform, goggles or whatever, that’s the bosses job and so it is. 

So there’s nothing I can claim right? Wrong!

You can claim an expense, it’s called a Flat Rate Expense and Mr Taxman wants you to have it every year that you are operating that lathe. It’s not much, approximately £150 a year, but it all helps! And, if you haven’t been claiming it, then we can go back up to 5 years for you, which then equates to £750!! So definitely worth having.

Get in touch to claim your flat rate tax expenses

It covers every occupation under the sun that you can think of, Nurses, Miners, Wire makers (and wine makers come to think of it!), aircrew, uniformed doormen, lace makers, labourers, policemen, railway workers, you name it, the job is probably covered, so take a look here to see if you are covered job expenses are covered

Self Employed? There’s even more expenses you can claim

If you’re self-employed, there’s even more expenses you can claim. You can claim for things you buy to enable you to perform your job, such  as tools, computers, equipment, books, to name but a few. You can even claim for a car/van or public transport which you use to enable you to do your job. Again, we are the experts and can claim everything that is claimable to reduce your tax bill. 

You don’t need to be self-employed to claim a hefty chunk of expenses

But you don’t need to be self-employed to claim a hefty chunk of expenses. For example, if you’re an estate agent and you show clients around properties day in, day out, you can claim tax back on the mileage that you are doing and claims can amount to £4500 per year or more. Again, we can help you claim the maximum refund. 

Do I have to pay UK tax if I’m from overseas (Non Resident Tax Refunds)?

So what if I am from overseas, what happens to the tax I have paid? Good question. Well, you are treated the same as a UK resident, in fact the way HMRC see you is you are “Resident Not Ordinarily Resident”- Only a government department can come up with a term like that!! 

97% of overseas visitors we talk to are due a UK tax refund!

But the beauty is that term means that you are probably leaving at some point during the tax year (and for that matter arriving during a tax year) and therefore you have an exceptionally high chance of getting a tax refund. We know this because we have been doing this for over 30 years and 97% of overseas visitors we talk to are due a tax refund! 

If we can avoid talking to anyone who purports to be an accountant or tax agent, we will

Okay, so now I’m hooked on tax. Is that normal? No, it isn’t, it’s one of our least favourite topics as a human being and quite frankly, if we can avoid talking to anyone who purports to be an accountant or tax agent, we will. But, hang on, it’s good you’re hooked, it shows a willingness to actually make yourself better off. Lots of £’s in your pocket that would otherwise go unclaimed. Now we know it is agonising to even begin to think about it, but we have made the process agonisingly simple. A blind dyslexic elephant could complete this application – it takes 5 minutes and it’s all you need to do and we will leave you alone, only bothering you in a few weeks’ time, when we try to pay your refund into your bank account!! Oh wow, where do I start, gimme, gimme, gimme! Here you go, so let’s get started

Gimme, gimme, gimme! File a PAYE Tax Refund Request

(Do elephants have bank accounts? Do elephants have dyslexia!!)

We could honestly go on and on about tax, it’s what we love, but we also love claiming it back. Don’t get us wrong, everyone has to pay it, it’s part of the fabric of society, but there are millions of £’s out there that you are legally entitled to, but there are things that you just don’t know, but we do, that would just go right over your heads. For example, did you know you can claim for a toothbrush and hotel and flights and the food you eat if you’re on secondment from a job back home? 

“Okay, a bit random, how about you can claim for your tights”

Okay, a bit random, how about you can claim for your tights (if you’re a nurse) and the washing of your clothes if you’re in a job that’s a bit mucky, or the trips you make between old people every day, checking in on them and making them a cup of tea, so the ones you look after as a care worker!! All claimable, all worth a tax refund for you!! Again, let us help you claim a UK tax refund.

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