Year End Tax Review 2007 Contents A word to the wise Employee pensions A matter of trust Pension policies Family tax planning Mr and Mrs Inheritance tax Employee cars and fuel Borrowings and tax Tax-free perks Two jobs = too much NIC? Give generously and save tax Children's savings? Company or trade? Capital gains Business tax Investment limits Should VAT be flat?

Should VAT be flat? A simplified "flat rate VAT scheme" is available for businesses with turnover of up to £150,000.You pay a lower rate of output tax on your sales, but you don't claim input tax on your expenses. The rate depends on the type of business you are - some rates seem to be generous, and some are less so. It is at least worth considering the figures if you qualify, to see if it might save you money or time, or even both. There are bigger savings - or pitfalls - if you have two different activities which on their own would have different flat rates.The rules say you should use one rate for the whole business, and it's the one appropriate for the larger part of your turnover. That can be a very good thing or a very bad thing, and it's important to think about it. Action Point! Could you save under the flat rate scheme?