Tax Avoidance

Means using the tax rules to your best advantage. If you have used a scheme or arrangement to obtain a tax advantage you are required to disclose the details to H M Revenue & Customs. Failure to do so will result in penalties.

Tax Evasion

Means illegally reducing your tax bill by: -

• Understating your income;
• Excessive claim for expenses;
• Deliberately falsifying the nature of transactions, etc. In such cases you may face criminal prosecution as well as being required to pay the tax lost plus interest and penalties.

Tenancy in Common
A tenancy in common is where: The owners can have unequal interests in the property The interest of any owner passes on death under their will or, if there is no will, under the rules of intestacy The share of a tenant in common is usually in proportion to the money they put in to buy the joint property

Termination Payments

See Redundancy Payments

Trading Losses

There are various ways to claim for losses by a sole trader or a partnership. They can be relieved as follows:

• Carry forward against later profits of the same trade
• Set against general income of tax year of loss and/or the previous tax year. The claim for either year may, if the individual wishes, be extended to include set off against capital gains.
• In a new trade, carry back against general income of the previous three tax years, earliest first
• On cessation of a trade, set against trading income of the final tax year, then carry back against trading income of the previous three tax years, latest first.