22: Simplication measures

Question 1

what are the flat rates for cars/vans, and motorcycles (hint: think mileage)

Answer 1

CARS AND VANS:
First 10,000 business miles = 45p
Additional business miles = 25p

MOTORCYLES:
Business miles = 24p

Question 2

what are the flat rates for business hours worked in the home? (hint: no of hours worked in home and monthly expense)

Answer 2

25-50 = £10
51-100 = £18
100+ = £26

Question 3

can sole traders AND partnerships use cash basis?

Answer 3

yes

Question 4

what criteria do they ST and P have to meet in order to elect cash basis?

Answer 4

total business receipts for the tax year the election is made does not exceed £150,000.

Question 5

cash basis election

if the ST starts trading on 01 Jan 2021 and elects cash basis, what is the turnover maximum?

Answer 5

you must apportion the £150,000, so 3/12 x 150k = £37,500.

Question 6

cash basis election

if the ST has a period greater than 12 months, what does the limit become for cash basis maximum turnover?

Answer 6

remains as £150,000. you do not increase the limit for long basis periods