5 March 2018
In this month’s Q&A we consider Stamp Duty Land Tax (SDLT) in relation to the purchase of a main residence, claiming capital allowances for a website and paying employees who are on jury service.
Q. I own several properties jointly with my daughter. Most of them are rented out, but my daughter has lived in one of them for five years and is now considering buying a house on her own which will become her main residence. Will she have to pay the higher Stamp Duty Land Tax charge on the purchase?
A. Broadly, if the value of your daughter’s share of the rental property is more than £40,000, she will be liable to the higher rate of SDLT when she purchases a new property. Further information can be found in the HMRC guidance on the higher rates of SDLT applicable to the purchase of additional residential properties, which was published in November 2016; and on the gov.uk website here.
Q. I am the sole director and 100% shareholder of a company. Can the company claim capital allowances for the cost of setting up a website?
A. Expenditure on setting up a website is generally treated as expenditure on computer software. According to HMRC guidance (Business Income Manual: BIM35815), ‘the cost of a website is analogous to that of a shop window. The cost of constructing the window is capital; the cost of changing the display from time to time is revenue’.
Computer software acquired with hardware (eg. an operating system) and accounted for as part of the cost of the hardware will qualify as plant in the main capital allowances pool.
Q. What should I pay employees who are on jury service
A. There is no statutory entitlement for an employee to be paid by his or her employer during jury service. However, if the contract of employment has a clause covering such a situation, the employer must follow the terms of the contract.
Whilst on jury service, the employee is entitled to claim allowances from the court to cover travel and subsistence costs. In addition, a financial loss allowance may be claimed in respect of any loss of net earnings suffered as a result of attending the court.
The maximum financial loss allowance depends upon the number of hours served. These amounts are reviewed annually and are currently as follows:
- First 10 days: four hours or under each day – £32.47
- First 10 days: over four hours each day – £64.95
- Day 11 to day 200: four hours or under each day – £64.95
- Day 11 to day 200: over four hours each day – £129.91
- After day 201: four hours or under each day – £114.03
- After day 201: over four hours – £228.06
As one of the leading firms of accountants in the North East, with offices in Newcastle, Sunderland and Jarrow, we have the expertise to advise you on a wide range of tax related issues. If you would like to speak to one of our local experts, please contact us.