How to design an effective indirect tax return strategy

You need to identify the indirect costs you incur and related financing, recognize your options for reducing or avoiding excess costs, and apply an effective process for recovering or mitigating them. Relatively obscure concepts only a few years ago, these technologies are increasingly providing solutions to a range of challenges facing governments and global businesses. They have the potential to streamline and accelerate business processes, increase cybersecurity, and reduce or eliminate the roles of trusted intermediaries and centralized authorities. But these taxes apply to different products in different countries, sometimes at different stages of the supply chain; opportunities to reduce the impact of excise duties also vary between countries.

This can take quite a bit of time, so make sure you arrive early to your departure point. The best is to complete this step even before you go to the check-in counter with your luggage. That is because the customs agent might want to confirm that your purchases qualify for a refund. When you visit Europe and buy products and services, the price typically includes VAT.

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You could also have set up your new business as a limited company where you would be liable to pay Corporation Tax. Matt is a Chartered Tax Advisor with 18 years’ experience of advising on tax planning and compliance. Matt has been with Brookson since 2009, having previously worked for Big 4 accountants, KPMG and PwC. Matt’s primary role is to ensure that the services provided by the Brookson Group comply with relevant legislation and regulatory requirements.

You’ll find a simple questionnaire designed to assess whether you’ve paid too much tax. Among other things, that could be on pay from a current or previous job, pension payments, redundancy payments or a self-assessment tax return. However, in a trade off for this consideration, you will lose any tax-free allowances for income tax and capital gains. You will also be required to pay an annual charge if your residency in the UK exceeds a certain timeframe. This annual charge is 30,000 pounds if you have resided in the UK for at least 7 of the past 9 years, or 60,000 pounds if you have resided in the UK for at least 12 of the past 14 years.

Value-Added Tax (VAT): What it is and how to get it refunded if you shop while traveling

We outline two standard difficulties below, adding a third regarding data challenges when relying on economic incidence to estimate EATRs. Our overarching point is that the economic incidence of a tax cannot be expressed as a single parameter appropriate for estimating EATRs; any such estimates inevitably rely on numerous simplifying assumptions, and those assumptions often lack transparency. The effect of changes in the top (marginal) rate of income tax is clearly visible. For incomes above £150,000, this rate was increased by 10pp from 40 per cent to 50 per cent in 2011, then lowered again by 5pp to 45 per cent in 2014.

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The annual deadline for doing this depends on whether you are a UK resident or non-resident. UK residents have until 31 January each year to file their return for the previous tax year (e.g., until 31 January 2024 to file their 2022–2023 tax return) if using the online self-assessment tax return system. There are two ways you can manage these calculations; manually in a spreadsheet or using crypto tax software like our platform CryptoTaxCalculator. As you can imagine, doing this manually for each and every transaction you make would be a nightmare… That’s where we come in! Import your crypto transaction data into our platform via our API or CSV integrations, reconcile any outstanding instances and get an up-to-date calculation of your values in each respective category. Venture capital trusts, or VCTs, for example, offer 30% tax relief on investments up to £200,000, so long as you keep them for five years. This can be set up using salary sacrifice, where you forgo taxable salary to pay for benefits, including childcare, private medical insurance and company cars (with additional tax incentives if you go for an electric car).

Nowadays, any discussion on the future of indirect taxes is almost bound to include the terms robotic process automation (RPA), artificial intelligence (AI), the Internet of Things (IoT), machine learning and blockchain. Managing excise taxes and understanding opportunities to mitigate their impact are crucial for all businesses operating in affected industries.

However, it may be quicker to set up a personal tax account and use that for your return. If your purchases were bought from a merchant who works with a refund service such as Global Blue or Planet, find their offices inside the airport. These services take a cut of your refund (about 4 percent), but save you further fuss and delay. Present your stamped document, and they’ll likely give you your refund in cash, right then and there. The refund will be in the currency of the country from which you depart; if you want to be reimbursed in a different currency, such as US dollars, you’ll be subjected to their (unfavorable) exchange rates. Read more about TaxPro rebates here. Charity donations to registered charities or community amateur sports clubs (CASCs) are tax-free, and either you or the charity can claim tax relief using Gift Aid. If you pay higher or additional rate tax, you can also claim the difference to the basic rate on Gift Aid donations.

Some automakers have also reduced their prices to $55,000 so their customers can claim the tax credit. If you choose to be taxed on the remittance basis, then you only have to pay tax on any of the income that you actually bring into the UK. However, if the income you earn from overseas sources exceeds 2,000 Pounds, or you bring any income into the UK, then you must report that income in a self-assessed tax return. In the UK, your business can claim capital allowances when you purchase energy efficient technology for your business activities, or you invest in technology that has low or zero carbon emissions. Any reliance you place on such information is therefore strictly at your own risk. Our free doc scanner makes saving receipts and physical forms as simple as snapping a photo.

Aside from abolishing specific reliefs altogether, another option would be to cap or otherwise limit their availability. This is the approach already taken to investment reliefs, although there is room for debate about the level of existing caps. Value of tax reliefs as a share of total remuneration, by remuneration level, decomposed by type of relief claimed, 2016. Finally, the trend in EATRs over time also shows the impact of the 7.5pp increase in the dividend rate in 2017. This is manifested as a dip in EATRs in 2016, the year prior to the reform, as individuals brought forward dividend payments (which are taxed at a lower rate than other forms of income), followed by an increase in 2017. For those with total remuneration of around £200,000, the 2011 reform raised EATRs by around 4pp, and this effect was broadly similar across all parts of the distribution of EATRs. This impact is consistent with what one would expect if individuals were fully exposed to the reform, given that only around £50,000 of income would be taxed at this higher rate.