That’s not a general notice to all those running a restaurant or takeaway in the United Kingdom.
Yet this certainly is the final word of warning to anyone and everyone out there, conducting illicit tax evasion activities.
Although there are other industries too that would get effected by the stretch of examination and action by HMRC. It’s just that the focus is on the restaurant sector.
There isn’t one example but many.
- A Chinese takeaway situated in Bangor, who saved £158,000 of tax was called to pay 77,000 of fine.
- Another Luton’s Indian restaurant had to pay a fine of £310,000 for £413, 00 of tax payment failure.
- That’s not all, an Italian restaurant serving pizzas also felt prey of this campaign and payed £27,000 for saving £60,000 of tax.
Why Restaurant Industry?
Hiding behind the plight of real small scale operators, many big restaurants save or reduce their tax liability by understating their income. A list initiated in 2017 December revealed a total of 775 tax defaulters out of which 200 were restaurants. There are some characteristics of business that leave an open gap for default. Following are those:
- It is in general easy for restaurants to reveal less income that they actually earn as most of the transactions are carried out by cash.
- Even the electric card payment mechanism is widely famous and also in acquaintance of tax authority. They too know its employment for evading the taxes.
- Tips can be another way of extra income that makes the restaurant sector more prone to felonious tax avoidance. Not forgetting the fact that their understatement or distorted way of reporting is no secret to taxman.
Thus, for the above reasons, restaurants in the United Kingdom, being 26% of the evaders undraped, are in a frequent scrutiny of taxation authorities.
Save Less With Legal Tax Avoidance VS Save More In Illegal Tax Evasion:
Prior one is obviously beneficial. It would also make you feel at peace. Apart from this, you may also get a free hand in operations.
Although there is actually a very thin line in between the above. You might not know when you cross the line and the taxman is upon you for clarifications. So you must be very careful with every step you take.
Remember? There isn’t a backspace, it would then only be a run from HMRC treading on the heels.
Here are some of the legal techniques of slashing your tax bills:
- Making your beloved in papers recue you from heavy taxes:
It is very general practice. Many people know about it. The only drawback here is that not every entrepreneur is married.
Adding your wife to shareholders would guard you from eligibility of paying high percentage of income taxes. If you make her legally eligible for lower income tax category, you would pay a lessened amount of capital gains tax.
- Altering your position in papers:
You know you are going to be a founder. You know the difference between you and other shareholders even if you share the ownership. Yet you must also know and abide by the responsibilities of a director to pay tax in name of legal entity.
There’s still a hope of saving some bill if you settle business in a way that you treat yourself as shareholders and pay yourself dividends like you pay to other shareholders.
- Give your business to next gen owners a few years before your death:
You certainly don’t know when you are going to die. So you can do it at an earlier stage too. If you somehow manage to hand it before 7 years of your demise, it would save your business’ tax pay-out amount.
- Leaving the country of headquarters for more than half a year:
Now you know why big businessmen do this. Just where you started the company, you would have to stay away from that place for a long time. This avoids you a certain amount without even putting much of your minds. You can carry on keeping an eye on your operations from distance though.
- Taking on the off-shore asset responsibilities and liabilities:
It saves you tax bills. Although there are legal obligations resulting costs in this scenario still you would ultimately save.
Not finding things easy? Don’t worry, we have a plan.
Hire Taxation Experts
They would do good to you in following ways:
- You may do those discussed above. Or else there are even more things that would legally save you a good taxation amount. A reputed financial or tax consultancy can help you in finding those.
- They might also tell you the most suitable way according to your firm. Not all firms can go by any of the above things, you certainly need accounting experts having thorough know how of the subject.
- Even if some of the above things suit you, a taxation expert would help you conduct everything easily.
Hire Trilogy Accountancy Services
Trilogy Accountancy services has an experienced team of experts serving several specifications.
They have an excellent team of taxation experts who would take you out of any fix and lower down your taxation payments legally.
You can also hire them for accounting and bookkeeping so that your books remain complete and in perfect finish throughout the year.
It’s the restaurants turn in tune, want to know who’s the next?
“The social influencers taking advantage of their role in societies”.
Let’s wait for some examples before judging the extent of effect on common influencers.