CTA cheat sheet

Personal allowance is £12,570 and is reduced by £1 for every £2 of adjusted net income above £100,000, reaching nil at £125,140.

Non-Scottish rates: 20% on taxable income up to £37,700, 40% from £37,701 to £125,140, and 45% above £125,140.

Dividend allowance is £500; dividend rates above the allowance are 8.75%, 33.75% and 39.35% according to the band in which the dividends fall.

Personal savings allowance is £1,000 for basic rate, £500 for higher rate and nil for additional rate taxpayers; the 0% savings starting rate covers up to £5,000 of savings income.

Employee Class 1 NICs: 8% on earnings between £12,570 and £50,270, then 2%; Class 4 self-employed: 6% and 2% on the same thresholds.

Pension annual allowance is £60,000, tapered by £1 for every £2 of adjusted income above £260,000 to a minimum of £10,000; unused allowance carries forward up to three years.

The trading allowance and property allowance each exempt £1,000 of gross income, and rent-a-room relief exempts £7,500 of rental income.

Beneficial loan benefit = (official rate of interest − rate charged) × loan; loans totalling £10,000 or less are exempt.

Marriage allowance transfers £1,260 of personal allowance between spouses or civil partners, giving a tax reducer worth up to £252.

Corporation tax: 25% main rate; 19% small profits rate where augmented profits are £50,000 or less; marginal relief between £50,000 and £250,000 gives an effective 26.5%.

The £50,000 and £250,000 limits are divided by the number of associated companies (including dormant ones).

Corporation tax is payable nine months and one day after the period end; quarterly instalments apply where profits exceed £1.5 million (£10 million for large companies).

Deductions require the wholly and exclusively rule; depreciation, client entertaining, fines and capital expenditure are not deductible.

Annual investment allowance gives 100% relief on plant and machinery up to £1 million; full expensing gives 100% for new main-rate assets and 50% for special rate assets for companies.

Writing down allowances are 18% for the main pool and 6% for the special rate pool, applied on a reducing balance basis.

Trading losses may be carried back 12 months, carried forward indefinitely subject to the £5 million plus 50% restriction, or set against total profits of the same period.

R&D: the merged scheme gives a 20% above-the-line credit; loss-making R&D-intensive SMEs may use the enhanced intensity ratio scheme with a 14.5% payable credit.

A close company pays 33.75% on loans to participators outstanding nine months after the period end, refundable when the loan is repaid.

Capital gains tax annual exempt amount is £3,000 for individuals and personal representatives; most trusts receive £1,500.

For disposals on or after 30 October 2024 CGT rates are 18% within the basic rate band and 24% above it, including residential property gains.

Business Asset Disposal Relief taxes qualifying gains at 10% up to a £1 million lifetime limit; the rate rises to 14% for 2025/26.

Inheritance tax nil rate band is £325,000; the residence nil rate band is £175,000 and tapers by £1 for every £2 of estate value above £2 million.

IHT is charged at 40% on death, reduced to 36% where at least 10% of the baseline estate passes to charity.

Lifetime chargeable transfers bear 20% on the excess over the nil rate band; a PET that fails through death within seven years is brought into the death estate.

Taper relief on failed PETs reduces tax by 80% (3-4 years), 60% (4-5), 40% (5-6) and 20% (6-7 years before death).

Relevant property trusts pay an anniversary charge of up to 6% of value above the nil rate band every ten years, with proportionate exit charges between.

Discretionary trust rates are 45% on non-dividend income and 39.35% on dividends; bare trusts are taxed on the beneficiary.

VAT rates: standard 20%, reduced 5%, zero 0%; exempt supplies bear no output tax but block related input tax.

Registration is compulsory when taxable turnover in any rolling 12 months exceeds £90,000, or is expected to exceed it within 30 days; the deregistration threshold is £88,000.

A supply is taxable if it is a supply of goods or services, made in the course or furtherance of a business, for consideration, in the UK.

Place of supply of goods is where the goods are located at the time of supply; B2B services are supplied where the customer belongs and B2C services generally where the supplier belongs.

The tax point is the earlier of the invoice date and the date payment is received, unless the supply is completed earlier.

Overseas B2B services received by a UK business fall under the reverse charge: the customer accounts for output tax and recovers it as input tax.

Input tax is blocked on business entertaining, on cars available for private use, and on non-business use.

Partial exemption de minimis: exempt input tax is recoverable where it is no more than £625 per month on average and not more than 50% of total input tax.

Other indirect taxes include SDLT, LBTT and LTT on land transactions, insurance premium tax at 12% (higher rate 20%), and excise and customs duties.

Statutory residence test: automatic UK residence at 183 days in the UK, automatic overseas residence at fewer than 16 days; otherwise sufficient ties decide.

A permanent establishment is a fixed place of business or a dependent agent; profits attributable to it are taxable in the source state.

Double taxation relief gives a credit for foreign tax against UK tax on the same income, limited to the UK tax attributable to it, with excess carried forward.

Transfer pricing requires arm's length terms between connected persons, with lighter rules for small and medium-sized enterprises.

UK withholding tax on interest and royalties paid to non-residents is 20%, usually reduced by an applicable double tax treaty.

CFC rules attribute low-taxed profits of controlled foreign companies to the UK company unless a specific exemption applies.

The OECD Pillar Two 15% global minimum tax is implemented in the UK by the multinational top-up tax for accounting periods beginning on or after 31 December 2023.

Self-assessment returns must be filed online by 31 January following the tax year; paper returns are due by 31 October.

Payments on account of 50% each are due on 31 January and 31 July where the liability exceeds £1,000 and less than 80% is collected at source.

Late filing penalties: £100 fixed, then £10 per day after three months, then percentage penalties at six and twelve months.

Late payment: 5% of unpaid tax at 30 days, six months and twelve months, plus daily interest.

Records must be kept for five years after the 31 January filing deadline; six years for businesses and property income.

HMRC may open an enquiry within 12 months of the filing date; discovery assessments are possible within 4 years, 6 for carelessness and 20 for deliberate behaviour.

HMRC information powers are in Schedule 36 FA 2008, and a taxpayer may appeal a notice to the First-tier Tribunal.

Making Tax Digital for VAT requires digital records and compatible software; MTD for income tax applies from April 2026 to qualifying income above £50,000.

PCRT fundamental principles: integrity, objectivity, professional competence and due care, confidentiality, and professional behaviour.

Tax evasion is a criminal offence; tax avoidance is legal but may be counteracted by the GAAR, which applies a double reasonableness test.

Confidentiality is overridden by statute: suspicious activity reports go to the NCA and the client must not be told (tipping off).

Legal professional privilege protects communications with lawyers in legal proceedings, but not general tax advice given by accountants.

Conflicts of interest require separate teams, informed consent, confidentiality walls or declining the engagement.

DOTAS requires promoters to notify HMRC of notifiable schemes and give clients a scheme reference number to quote on returns.

Money laundering rules require customer due diligence, ongoing monitoring, five-year record keeping and a nominated officer.