Can Setting Up a Trust Reduce Inheritance Tax in the UK?
I want to set up a trust, will it reduce my Inheritance tax bill? The answer is Yes it will. This is because when you set up a trust and transfer your assets which could be your property, land, money, or shares will not be part of your estate on which Inheritance tax is applied. To look for inheritance tax rates click here While you are trying to save up your inheritance tax, the rules involved in setting up the trusts and the way that income is taxed could be tricky and you might have to hire an accountant or a lawyer which can be costly. When you put your assets in the trust there could be income taxes and capital gains taxes and that depends on the type of your asset and the trust that you want to set up. You should take professional advice to assess the overall costs. When you put money in the trust , it belongs to the trust and it won’t form part of anyone’s estate. However, the beneficiaries might have to pay the income tax and the capital gains tax. There are several different types of trusts that can be set up. All of the above trusts are taxed differently, however, all of them involve a settlor ( the one who puts the assets in the trust),trustee( the one who manages the trust), beneficiary(the person who benefits from the trust) You set up trusts for your assets depending on your individual requirements, here we will talk about Bare Trusts and Discretionary trusts. For example a bare trust is a simple trust in which you put your assets and they are in the name of the trustee. The beneficiary will have the right to the asset when they are 18 or over. They will be entitled to the capital ( the money) as well as the interest that is being earned on that money. In this type of a trust the trustee must act according to the wishes of the beneficiary when they reach a certain age and therefore the beneficiaries and not the trustees have absolute rights over the funds. If you want to leave your assets to your family or friends and you want to control how it will be used then you can use a discretionary trust. In such a trust the trustee has the power to distribute the capital as well as the interest on the capital to the beneficiaries according to their own wishes. They can decide how they want to distribute the funds to the beneficiaries. If the settler wants they can nominate themselves as a trustee initially, and they can use the funds for their children’s education, health or maybe even fund their houses. The trustee responsibility can be passed on to someone else who can continue to act in the favour of the beneficiary. For example, you want your grandchildren to be benefited from the funds so you pass on the trustee responsibility to their parents. By setting up trusts you make sure that your wealth is distributed and used by your family and friends the way you want it to be in a tax efficient way. The family will be benefited from the funds without losing their entitlement to the state benefits. If you need any further information contact Taxaccolega, accountants in Croydon, Surrey at 020 8127 0728 our expert team of inheritance tax accountants will take care of your asset and estate planning and account for your inheritance tax liabilities. CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *
Amazon Sellers VAT UK Guide – What You Must Know
Things I should know about Vat while selling on Amazon. Many e-commerce businesses who are selling on Amazon, find it hard to understand VAT rules on their online sales. Sometimes they are even reluctant to spread their business in Europe because they think that they will have to deal with complicated VAT rules. If you are using the Amazon platform to sell your products then it’s best to be confident with all the rules so you can sell to the Amazon clientele worldwide. In this blog, I have tried to simplify the rules for you but still if you are unsure you can contact e-commerce accountants they can explain things to you and also deal with your accounts . We will start by understanding what VAT is? In simple terms, VAT is a tax which is collected by the seller from the end consumer and passed on to the tax authorities. The value of VAT is added to the selling price, the price at which the seller sells its products to its customers. If you have your customers in European countries you might have to register for VAT in that particular country as well, however, some rules have been changed and a new E commerce VAT package introduced in 2021. When you sell your products online you may come across the following scenarios: 1.Uk registered business with the product in the UK selling to a customer in the UK: If your business is registered in the UK and your product is in the UK and selling to the UK customer. The tax rate applied will be 20%. The seller will be responsible for accounting for VAT . However, if you are drop shipping and the product is coming from outside the UK to the customer in the UK and the value of the product is £135 or less then Amazon marketplace will be responsible for collecting the VAT. 2.If your business is not UK based If your business is not UK based and you are selling your products directly to the customer in the UK through Amazon which is a B2C company. Amazon will collect the VAT for you and account for VAT. Where Amazon is responsible for collecting VAT you need to make sure that you declare VAT in your VAT return however this does not need to be shown in box 1 figure. Where Amazon is responsible for collecting VAT the seller won’t have to include the VAT in the price of their products. In Fact, the customers will see the VAT value added to the product at the time of the check out. What is One Stop Shop( OSS)? And what is Import One Stop Shop(IOSS) ? OSS and IOSS are the systems introduced by the new E-commerce VAT package. This system helps facilitate the sellers who have customers in more than one Eu country to file the VAT return in one place. If you are selling within the EU you will register with OSS and if you are selling to the EU you will have to register with IOSS. Amazon is registered for IOSS and therefore if you are selling on Amazon you don’t have to register for IOSS, you can use Amazon IOSS number on the customs form which will indicate that the customer has already paid the VAT and therefore no VAT will be charged at the customs. If you are an FBA seller that means that your products are stored in the different countries that you are selling you will have to report your VAT in the country you are selling. This may be difficult from an administrative point of view. To facilitate this there is an OSS scheme. We at Taxaccolega as e-commerce accountants deal with such VAT on a daily basis. If you have any queries give us a call here or visit us we are accountants based in Croydon, Surrey. CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *
UK VAT Rules for Amazon & Online Sellers Explained
My UK VAT responsibilities if I am selling online on amazon If you are selling online you might be selling directly to a customer who is not VAT registered, to a business customer who is VAT registered, and you might also be selling through an online marketplace such as Amazon and Ebay. The UK VAT responsibilities are slightly different in each case. If the rules get tricky and confusing for you please do not hesitate to contact Taxaccolega and our expert team of e-commerce accountants will be there to help you. When are you required to register for VAT? You are required to register for VAT in the UK if the following applies to you: ● If you are registered as a business in the UK and your business’s VAT taxable turnover is more than £85, 000 a year. You will have to register for UK VAT if you are an overseas seller and the following applies to you ● If you are an overseas seller with goods stored in the EU and your total sales to the customers in Northern Ireland are more than £70 000 a year. ● If you are an overseas seller and the online marketplace such as amazon provides you with the VAT details of its business customer. ● If you are an overseas seller selling goods located in the Northern Island at the point of sale and sold to customers in the Northern Island. Source: https://www.gov.uk/guidance/vat-overseas-businesses-using-an-online-marketplace-to-sell-goods-in-the-uk You can get yourself registered online by following the link here or you can do this by post by filling up a form here Once you are registered you will get a VAT registration number. You will have to give it to Amazon or any other marketplace that you are planning to sell on. You are now responsible for collecting VAT from your customers, account for them in the VAT return on a quarterly basis and pay it to HMRC. I have outlined the points which you will have to consider when you are a UK established business, have an online presence and you are selling through an online marketplace. We will discuss how they affect the VAT return in detail in our other blog. ● The nature of goods that you are selling as it will affect the VAT rate that you will be charging ● The value of your consignment- This will affect who will be responsible for the VAT( you or the amazon or any other marketplace) This is important as this will have an impact on your VAT return- If the value of the consignment is £135 or less the online marketplace will be responsible to account and charge the VAT at a point of sale. ● The value of your goods that you are selling in the UK ● The value of the goods that you are selling in the EU ● The sales that are made directly to your UK customers ● The sales made directly to your EU customers ● The sales made through Amazon or any other marketplace to your UK customers ● The sales made through Amazon or any other marketplace to your EU customers ● The sales made through Amazon or any other marketplace to UK Business customers ● The Sales made through Amazon or any other marketplace to the Business customers in the EU. In addition to the above information you should also know precisely where your goods are at the point of sale. For that matter you might have to classify your sales in 2 categories: ● UK seller selling goods in the UK at the point of sales to the UK customers ● An overseas seller( meaning that your business is established outside the UK and goods are either placed in the UK or in the EU at the point of sales) In this case you will still have some UK VAT responsibilities. You can get guidance on this matter If you are thinking of starting a business, registering your business in the UK, registering for VAT when selling online, filing VAT returns contact Taxaccolega, e-commerce accountants in Croydon, E commerce accountants in London, and our expert team of accountants will be there to help you. Call us on 020 8127 0728 or leave us a message here and we will get back to you, CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *
Inheritance Tax planning and Business Property Relief?
Inheritance Tax Planning and Business Property Relief? If you own a business, or interest in the business or shares in an unlisted company you will be entitled to 100% BPR relief. Getting a 100% BPR relief will mean that this particular qualifying business, interest in the business will not become part of your estate on which you will have to pay Inheritance tax at the time of your death. Inheritance tax is paid on everything you own at the time of your death if the value of your estate is above £325 000 unless you leave all your wealth to your spouse, charity or community amateur sports club. There are certain reliefs available which will reduce the inheritance tax and the business property relief is one of them. It will either reduce the inheritance tax on the qualifying asset by 100% or 50% depending on the circumstances which are discussed below. You will get 100% relief if: You will get 50% relief if : Conditions: Inheritance tax Planning: If you want to manage your assets so as to reduce your inheritance tax you should consider investing your wealth in a business which qualifies for an exemption from Inheritance tax. This might be better than gifting your wealth in your lifetime in 2 ways: However, this also means that you are investing in a high risk investment and your capital might be at a risk. BPR can be claimed by the executor of your will or the administrator of your estate. HMRC will assess the qualifying assets for the BPR relief after the appropriate forms are filled. Estate planning can involve lots of rules which need to be considered, different reliefs are available depending on your personal circumstances. You might want to consider hiring an accountant who can help you with this. We at Taxaccolega, have a team of accountants who can help you with estate planning, setting up trusts, calculate and pay inheritance tax bills. Just call us at 020 8127 0728 or leave us a message here and we will get back to you, you can also email us at [email protected] Source: https://www.gov.uk/business-relief-inheritance-tax CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *