Frequently asked questions
Please read through our FAQ’s. If you have a question that is not one of the FAQ’s, please do not hesitate to contact us.
The P800, P45, P60, and P11D forms are used for the PAYE scheme.
Pay As You Earn, or PAYE, is the process whereby the taxes you owe on your income are taken off your pay before you receive it. This is done by your employer, who pays that money to HMRC.
If you pay taxes via PAYE and your only income is a single salary, it is unlikely that you will have to submit a Self Assessment tax return. However, you will still encounter several forms which are important for you to keep track of and understand to make sure you, or your employer on your behalf, are paying the right amount of tax.
When you are self-employed, as with other types of business, you will have various costs to keep your business running. Many of these expenses qualify for tax relief, which means you can deduct the value of these expenses from your profits before working out how much tax you owe.
You can claim tax relief on small and regular costs as ‘allowable expenses’. These are things like fuel for business use, staff costs, and advertising. More expensive items which you are likely to use for more than 2 years can be claimed as ‘capital allowances’. If you rent property, we have a guide for rental expenses that qualify for tax relief. You will have to report these expenses on your Self Assessment tax return. You can follow this link to read our tips on common mistakes to avoid.
Figuring out whether you need to pay tax on income earned outside of the UK depends on whether HMRC classifies you as a ‘UK Resident’.
If you are not classed as a UK Resident, you will not pay tax on your foreign income. UK Residents will pay UK tax on all of their income, no matter where it was earned. There are some special exceptions for those who permanently live abroad – we’ll cover those later.
Wondering whether you should buy a car through your company or buy it personally? Lets look at the options and what their benefits and cons are.
Buying a car personally
The vehicle cost is non-deductible from tax.
Business trip fuel paid for by the company is tax-free as long as it remains under 45p/mile for the first 10,000 miles annually, then 25p/mile thereafter. A company paying for private fuel use creates a Benefit in Kind, described below, and is often not tax efficient.
Buying a car through a company
The company can deduct a portion of the car’s value from their taxable profit as a kind of Capital Allowance.
However, this only applies if the vehicle is used ONLY for business trips. This does NOT include commuting to and from work, which is considered private use. Company ‘pool’ cars are a valid business use. In these cases, the car is kept on site and used by multiple employees.
The amount deductible depends on the CO2 emissions for the vehicle. For electric vehicles (or any vehicle with CO2 emissions under 96g/km) you can claim 100% of the vehicle’s value immediately in the first year.
For other vehicles, you can claim either 8% (for cars with CO2 emissions above above 130g/km) or 18% (for cars with CO2 emissions between between 96g/km and 130g/km) of the vehicle’s value every year the company still owns the vehicle.
This means that you can eventually deduct the full value of the vehicle from the company’s taxable income, but it would take either 6 or 12 full years to eventually do so.
If you’re renting property owned by you, rather than your business or company, you could qualify for income tax relief. However, this depends on the kind of rentals you are running. There are also many costs associated with rentals that can lower your taxable profit, which we outline further on.
Let’s talk pensions. Everybody needs to make a plan for when they eventually retire. Nobody wants to work forever, and that means making sure you have enough money to live off of after saying goodbye to your 9 – 5 job. The most common way to save for retirement is through pensions.
Pensions are schemes which you pay a certain amount into regularly and which will pay money out to you once you reach retirement age. Pensions don’t simply hold onto this money to pay it back to you later. They will invest this money in some way so that you end up receiving more money in the end than you’ve paid in over the years.
There are many types of pensions in the UK, but the most important divide is that of the state pension vs. private pensions.
State Pension
As the name suggests, the state pension is provided by the UK government. The previous state pension scheme is called the Basic State Pension. In 2016, this scheme was replaced by the New State Pension. Those who reached pension age before 2016 will continue to be paid the Basic State Pension.
The New State Pension rules therefore apply to men born on or after 6 April 1951, and women born on or after 6 April 1953.
‘Phishing’ is the term for attempting to get someone to give you personal information / access to systems by pretending to be someone else. This could be an email from someone who claims to be writing from your bank, or a phone call from someone pretending to be with a government department.
31 January every year.
→ Link: Self Assessment Like a ProAll legal profit-seeking businesses fall into one of two broad categories: unincorporated and incorporated. The difference is that incorporated forms have what is called a ‘separate legal personality’. The business is considered its own entity under the law.
This means that those in charge of unincorporated businesses bear full responsibility for the company’s debts. The people running incorporated businesses, on the other hand, have what is called ‘limited liability’ – they only stand to lose what they have already invested.
Perhaps you’re self-employed and looking to expand your business. Or maybe you’re looking to start a new endeavour from scratch, and want to raise capital by selling shares. Whatever the reason, you’re thinking about creating an incorporated business, often called a company.
There are several steps to go through to establish and register a new company, but first and foremost is understanding what you’re signing up for.
Limited companies are a form of legal business where the company is a separate legal entity to the individuals who run it. All companies must keep records about the people who make decisions or are invested in the company. These are called ‘statutory registers’.
Limited companies are a form of legal business where the company is a separate legal entity to the individuals who run it. All companies must keep records about the people who make decisions or are invested in the company. These are called ‘statutory registers’.
All legal profit-seeking businesses fall into one of two broad categories: unincorporated and incorporated. The difference is that incorporated forms have what is called a ‘separate legal personality’. The business is considered its own entity under the law.
This means that those in charge of unincorporated businesses bear full responsibility for the company’s debts. The people running incorporated businesses, on the other hand, have what is called ‘limited liability’ – they only stand to lose what they have already invested.
Professional accountancy bodies are the organisations responsible for accounting qualifications. That means they create curriculums, train students, and run exams. In principle, any organisation can do this, so how do you know which qualifications are actually up to standard?
The organisation given power by the UK government to oversee accountancy is the Financial Reporting Council (FRC). The FRC serves as an independent regulator of accountants, and decides which qualifications make accountants able to perform audits. To legally call themselves a ‘chartered accountant’, a person must be a part of a professional body with a royal charter.
HMRC’s ‘Your Charter’ sets out what the public can expect from HMRC and vice versa. The HMRC Charter is a legal requirement under the Finance Act 2009. The Charter helps define the service and standard of behaviour that taxpayers should expect when interacting with HMRC.
Accounting regulatory bodies are essential for ensuring that accountants, actuaries, and auditors are trained to a common standard and held to a code of ethics and good practice. In the UK, the top level of oversight is performed by the FRC, or Financial Reporting Council.
While FRC does not train or certify accountants, they serve as an independent regulator of professional bodies and set the UK’s Corporate Governance and Stewardship Codes. The FRC recognises six professional accountancy bodies, for which they provide oversight. This includes handling complaints regarding the actions of these bodies as a whole.
The short answer is yes, you can appeal your HMRC penalties provided you have adequate evidence to support your appeal. The HMRC can raise various penalties including failure to pay/file and failure to notify penalty. If you find yourself in this situation and you’re wondering “How do I fight the HMRC” you have found the right place to help you. The HMRC leaves ample room for individuals (Self Assessments) and corporations (Corporate tax and VAT returns) to appeal against a penalty, it is just about understanding the process to make use of it.
So you’ve received a HMRC penalty and you’re freaking out just a little bit. Whether this was intentional or by accident, an HMRC penalties notification can be a stress-inducing event. But let’s talk about what you can do now that you’re here. Firstly we will look whether you have a reasonable excuse (as defined by the HMRC), and if not, we’ll look at how you can get your penalties reduced as much as possible.
As accountants that specialize in tax returns we see these self assessment mistakes over and over again. Self assessments is already stressful enough as it is. But lets just look over 10 of the biggest mistakes people make when they are filing their personal tax returns.
These are all avoidable mistakes if you know your way around the tax legislation, and if you don’t know your tax legislation, CIGMA Accounting is here to lend a helping hand.
- Forgetting about tax free allowances
- Not declaring the correct salary and benefits (PAYE)
- Claiming ineligible expenses
- Using wrong tax code
- Not declaring all income
- Not adding supplementary pages
- Human error
- Submitting self assessment when you don’t have to
- Missing the deadline for submissions
- Failing to plan for your tax account accordingly
Every limited company registered on Companies House must submit annual accounts and confirmation statement to Companies House. The company will also submit a Corporation Tax return to HMRC. The amount of money the company made or lost is irrelevant. Dormant companies must also submit these documents. However, instead of annual accounts a dormant company will need to submit dormant accounts.
A confirmation statement, also referred to as a CS01, is a document a company submits to Companies House at least once a year. Companies also submit a confirmation statement when there is a change in company structure.
At CIGMA Accounting, our goal is to make onboarding quick and stress-free.
Typically, we complete the process in 3–10 working days once we receive your bookkeeping data, bank feed access, HMRC authorisations (for VAT, PAYE, Corporation Tax, and Self Assessment), and prior-year accounts.
We use a centralised task checklist so you can track progress in real time, and our AI system ensures nothing is missed — from HMRC agent authorisations to software setup in Xero, QuickBooks, or FreeAgent.
A dedicated client manager walks you through everything during a 30-minute kick-off call so you can focus on running your business while we handle compliance.
Never. Messy books are common — what matters is getting them right.
At CIGMA, we create a catch-up and clean-up plan:
Scope of work (months affected)
Estimated hours & fixed fee where possible
Timeline to get back in control
Once clean, we set up automated bank rules, receipt capture tools, and month-end procedures so you never end up in the same situation again.
Blog: Rescue Your Messy Books
We make it as painless as possible.
You’ll only need to send:
Photo ID & proof of address
HMRC UTRs & Companies House number
Bank/PSP list & prior accountant contact
Accounting software logins
Everything else is requested through a single task board with deadlines. No duplicate chases, no repeating yourself — thanks to our centralised system
Many business owners are frustrated by surprise bills for HMRC enquiries, backlog bookkeeping, or amended CT600s.
At CIGMA, we’re completely transparent:
We flag any out-of-scope work upfront
Provide a fixed quote
Log it in your client portal for approval before we start
No nasty surprises — just clarity.
Yes. Our bundled monthly plans include bookkeeping, VAT returns, payroll, year-end accounts, CT600 filings, and Self Assessment returns for directors.
Specialist services like R&D claims, EMI share schemes, or due diligence are quoted separately so you know exactly what you’re paying for.
Growth is great — and we support it.
We review your package quarterly, using data from our AI tracking system (transactions, headcount, revenue).
If you outgrow your plan, we agree the new tier in writing before we apply it — no hidden price hikes
We pride ourselves on speed.
Same-business-day acknowledgement
Full response within 2 working days (faster for HMRC deadlines)
Our AI-powered ticketing system ensures queries are routed to the right tax specialist — corporation tax, VAT, payroll, or advisory — and our backup staff cover absences, so you’re never left waiting.
With CIGMA, you don’t have to chase.
Monthly status email summarising open tasks
Live client portal with traffic-light statuses (green = done, amber = pending, red = urgent)
You’ll always know exactly what’s happening and what’s due next.
VAT returns: due 1 month + 7 days after period end
PAYE/RTI: on or before payday; PAYE tax/NIC by 22nd (electronic)
Company accounts: 9 months after year end
CT600: 12 months after year end (tax due 9m+1d)
Self Assessment: 31 Jan online filing, 31 Jan/31 Jul payments
Our system logs every deadline, sends reminders, and escalates if you fall behind.
Don’t panic — we deal with this all the time.
We:
File ASAP to stop penalties growing
Appeal if there’s a reasonable excuse
Provide you with a triage checklist so we can act fast and protect your cash
Upload it to our portal.
Our AI-assisted triage and senior tax advisors will:
Identify urgency (routine, nudge, or full enquiry)
Draft a professional reply
Liaise with HMRC directly if needed
Acting early prevents penalties and interest from escalating.
Often yes — if you act quickly.
We negotiate penalty suspension, reduction, and time-to-pay arrangements with HMRC.
It’s rare — most checks are by letter or video call.
If there is a visit, we prep you with a Q&A brief and handle communications.
Usually, duplicated feed lines, manual journals, or missing reconciliations.
We run a bank rec drill, fix bank rules, sweep suspense accounts, and lock dates for accuracy.
Yes — HMRC still requires evidence.
We set you up with digital capture (Dext/Hubdoc) so receipts are matched to transactions automatically.
Most limited companies must use accruals, but sole traders may use cash basis.
We compare both for tax and MTD implications before recommending.
Wrong codes, missed input VAT, or poor timing can inflate your bill.
We run a VAT audit in Xero/QuickBooks, check scheme eligibility, and optimise future coding.
Sometimes, we model 12 months both ways to see if you’d save money.
Yes, if taxable turnover > £90k (rolling). We also handle voluntary registrations where it’s beneficial.
We calculate a tax-efficient mix, factoring NIC thresholds, student loans, IR35, and dividend allowances.
Yes — we provide HMRC-approved mileage logs and home office claim templates.
Usually, late RTI submissions. We automate reminders and file EPS/FPS corrections.
Profit ≠ cash. We prepare a cash flow bridge showing where funds went (VAT, director drawings, loan repayments).
Final bank recs, ledgers, stock/WIP counts, fixed asset schedules, loan statements, payroll year-end reports, major contracts.
Penalties escalate (£100+, then £500+). We prioritise late filings and can amend returns later if figures change.
We explain them, check if the reduction applies, and handle HMRC submissions to adjust payments.
Yes if you’re a director, have dividends, rental income, crypto gains, or other triggers.
Yes — we calculate PRR, lettings relief, and submit 60-day CGT returns on your behalf.
Yes — if the project genuinely advances technology. We prepare robust technical narratives and cost schedules to minimise enquiry risk.
We manage eligibility checks, valuation, scheme setup, HMRC notification, and annual compliance filings.
SEIS = early stage, higher reliefs. EIS = larger rounds. We support Advance Assurance and compliance forms.
Rarely. We handle professional clearance, request records, and migrate software with minimal disruption.
Yes — we reconcile to date and continue seamlessly.
MFA, encrypted storage, GDPR-compliant portals, and restricted staff access.
We recommend our secure portal, but if you must use email, we provide password-protected links.
We fix it promptly, handle HMRC follow-up, and maintain PI insurance for your protection.
Email your client lead or use our feedback form. We escalate in 1 day and provide a written resolution.
Yes — we help calculate a fair business percentage.
Yes for work-related training. We review eligibility before booking.
Capitalise and claim allowances, with personal-use adjustments where required.
Yes. Filing is based on income type, not the final tax unpaid. Self Assessment Like a Pro
HMRC will issue a notice by post or via an online account; interest accrues daily.
Our Penalties & Compliance Page.
You must register online and obtain your UTR within 10–14 days.
Please read our guide
Use allowable expenses, reliefs, and correct dividend/timing strategy.
Tax Planning for Directors / CIGMA Advisory
HMRC never asks for bank details via SMS.
HMRC Scam Guide
Making Tax Digital is HMRC’s move to quarterly digital reporting.
MTD for Income Tax Guide
Depends on income level; phased rollout.
MTD Timeline Page
Zoho Books + CIGMA setup recommended.
You pay through Self-Assessment and Class 2/4 NIC.
Home office, travel, equipment, subscriptions.
Self Assessment Like a Pro
Only a proportion if used for business.
Property Tax Page
Yes—on profit after allowable expenses.
Property Tax advice
Repairs, agents’ fees, insurance, replacements.
Landlord Tax Relief Page
£1,000 for micro-income (Airbnb / small rents).
LPC Guide
Through CGT on gains above your allowance.
Capital Gains Tax Page
Yes—CGT applies; deadlines can be 60 days.
Property CGT Page
HMRC adjusts for benefits or unpaid tax.
PAYE & Employment Guide
Check your P60/P45 against tax paid.
Self Assessment Page
Personal allowance + allowances vary.
General Tax Guide
31 January every year.
You may not owe tax if you’re selling your own second-hand personal items at a loss, but you might need to file a Self Assessment if you are trading or earning above the £1,000 Trading Allowance. HMRC now receives data from all major platforms, so understanding your tax position is vital.
Read our complete guide:
Are You Selling Goods or Services on a Digital Platform?
https://cigmaaccounting.co.uk/are-you-selling-goods-or-services-on-a-digital-platform/
Please read our article, which will guide you to choose the best option.