Blog

Carry forward unused pension tax allowance

The annual allowance for tax relief on pensions is currently set at £40,000. The annual allowance is further reduced for high earners. If your income is in excess of £150,000 you will usually have your allowance tapered.This works by reducing your annual allowance by £1 for every £2 your income exceeds £150,000 up to a […]

Annual increases to the National Minimum Wage

The Government has accepted the recommendations of the Low Pay Commission in full and has announced that it will increase the National Living Wage (NLW) and National Minimum Wage (NMW) rates from 1 April 2020 as follows: the NLW rate for workers aged 25 and over will increase from £8.21 to £8.72 per hour – […]

Public transport costs and tax

There are certain tax rules that are important to consider if you pay for the public transport costs of your employees. The provision of public transport costs includes season tickets provided for employees, season ticket costs reimbursed to employees, loans made to employees to buy season tickets and contributions to subsidised or free public transport. […]

Money laundering and terrorist financing

The money laundering rules are designed to protect the UK financial system and put in place certain controls to prevent businesses being used for money laundering by criminals and terrorists. The money laundering and terrorist financing regulations 2019 came into force on 10 January 2020. This updates the existing regulations to incorporate international standards set […]

Changes following loan charge review

The Government has revealed that a number of important changes will be made to the loan charge following the independent review of the remuneration loan charge policy and its implementation by Sir Amyas Morse and his team. The review examined whether the loan charge is an appropriate way of dealing with loans schemes (also known […]

Passing on the family home

The Labour Party were proposing to reverse the recent Conservative Party inheritance tax cuts if elected. They were referring to the additional nil rate band for passing on the family home. This additional relief should be taken into consideration when drafting your will. this means, when fully introduced in April 2020, an additional nil rate […]

What is a Personal Service Company?

When people talk about a Personal Service Company, they’re usually referring to a limited company which has been set up to provide the services of a single contractor, who is usually the sole shareholder and company director of the business. The term ‘Personal Service Company’ also features heavily in the context of the government’s rules […]

Income excluded from property business

HMRC publishes a list of income streams that are excluded from a UK property businesses’ taxable income. The list includes fishing concerns, hotels and guest houses, tied premises, caravan sites, lodgers and tenants in your own home, extra services to tenants and letting surplus trade accommodation. In most cases the income from these activities will […]

When National Insurance Credits can be claimed

National Insurance credits can help qualifying applicants to fill gaps in their National Insurance record. This can assist taxpayers to build up the amount of qualifying years of National Insurance contributions and thus increase the amount of benefits a person is entitled to receive, for example, the State Pension. National Insurance credits are available in […]

VAT flat rate scheme capital expenditure

The VAT Flat Rate scheme (FRS) has been designed to simplify the way a business accounts for VAT and accordingly , reducing the administration costs of complying with the VAT legislation. VAT is calculated under the FRS by applying a flat rate percentage to the flat rate turnover. The flat rate percentage varies from 4% […]

Child benefit tax charge

The High Income Child Benefit tax charge could apply to you or your partner if either of your individual taxable earnings exceeds £50,000 and you are in receipt of child benefit. The charge effectively claws back the financial benefit of receiving child benefit either by reducing or removing the benefit entirely. If you or your […]

Accounting periods if a company has two or more trades

A tax accounting period for Corporation Tax purposes cannot exceed a 12 month period. If company accounts cover less than 12 months then the accounting period will normally end on the same day, and thus will be shorter than 12 months. This can happen if the company stops trading or shortens its company’s year-end. There […]

New advisory fuel rates published

Advisory fuel rates are intended to reflect actual average fuel costs and are updated quarterly. The rates can be used by employers who reimburse employees for business travel in their company cars or where employees are required to repay the cost of fuel used for private travel. HMRC accepts there is no taxable profit and […]

Awareness of data protection fee campaign

The Information Commissioner’s Office (ICO) has launched a campaign aimed at contacting all registered UK companies to remind them of all their legal responsibility to pay a data protection fee. The campaign marks the start of an extensive programme by the ICO to make sure the data protection fee is paid by all those who […]

Tax Implications for Construction Industry

If you run a construction business and secure the services of sub-contractors, or if you are a sub-contractor, you will need to comply with a special set of tax rules known as the Construction Industry Scheme (CIS). The CIS rules determine the tax and National Insurance treatment for those working in the construction industry. Under […]

What Is a Joint Venture?

A joint venture is a commercial enterprise undertaken by two or more parties who otherwise retain their separate identities. The parties to the joint venture usually bring together different resources and areas of expertise to help fulfil a specific project. HMRC makes the point that on close examination of these associations prove to be partnerships, […]

61 Days to Go

You now have 61 days to file your 2018-19 tax return. Last year 11.5 million taxpayers were required to complete a Self-Assessment tax return but over 700,000 taxpayers missed the deadline. The deadline for submitting your 2018-19 Self-Assessment online is 31 January 2020. You should also be aware that payment of any tax due should […]

Employing Someone to Work In Your Home

When you employ someone to work in your home, it is your responsibility to meet the employee’s rights and deduct the correct amount of tax from their salary. This can include employees such as a nanny, housekeeper, gardener or carer. The rules are different if the person is self-employed or paid through an agency. If […]

Employing Staff for The First Time

There are rules and regulations that you must be aware of when you begin employing staff for the first time. The following points are from HMRC’s guidance which sets out some important issues you should be aware of when becoming an employer; Deciding how much to pay someone – you must pay your employee at […]

Increase in National Living Wage?

An independent review into the evidence on minimum wage rates has been published by the government. It concludes that increases in the National Living Wage (NLW) have little effect on employment whilst significantly increasing the earnings of low paid workers. This was found to be the case even in countries who had the most ambitious […]

Finance Bill 2019-20 Shelved

The Government’s draft finance bill has been shelved as we countdown to the general election on 12 December 2019. The consultation on the draft legislation has closed, but the prorogation controversy and Brexit issues meant there was no time for the Government to respond to any of the issues raised. The Bill contained the legislation […]

What is Capital Gains Tax incorporation relief?

If you own a business as a sole trader or in a partnership, a Capital Gain will arise if your business is transferred into a company structure. The gain will be assessed by reference to the market value of the business assets, including goodwill, at the date of transfer. This could give rise to a […]

New £20 note unveiled

The Governor of the Bank of England, Mark Carney, has unveiled the design of the new £20 note which features the artist JMW Turner. The new note will be launched on 20 February 2020 and will join the current £5 and £10 notes in being printed on polymer, a thin flexible plastic. The new plastic […]

Tax Relief For Private Pension Contributions

You can claim tax relief for your private pension contributions. The annual allowance is £40,000 for the current tax year. there is also a facility to carry forward any unused amount of your annual allowance from the last three tax years if you have made pension savings in those years. There is also a lifetime […]

Shared Parental Leave And Pay

The shared parental leave and pay rules offer working parents far greater choices as to how they share the care of their child and take time off work during the first year of their child’s life. Under the rules, mothers must take at least two compulsory weeks of maternity leave immediately after birth, but after […]

Changing your company’s year end date

There are rules in place which limit your options to change your company’s year end date. A company’s year end date is also known as its ‘accounting reference date’ and is set by reference to the date the company was incorporated. Under some circumstances it is possible to make a change to the year-end. You […]

Income Excluded From A UK Property Business

HMRC publishes a list of income streams that are excluded from a UK property business. The list includes fishing concerns, hotels and guest houses, tied premises, caravan sites, lodgers and tenants in your own home, extra services to tenants and letting surplus trade accommodation. In most cases the income from these activities will be taxed […]

Tax For Provision Of Parking Spaces

There are some important rules you must be aware of if your provide parking spaces to your employees. If the parking spaces you provide are at, or near your employee’s workplace, then you are entitled to an exemption. This means there is no requirement to report anything to HMRC and you are not required to […]

Reporting Employee Changes

There are rules that businesses must follow when they are reporting employee changes. These changes must be sent to HMRC using a Full Payment Submission (FPS). The FPS is a submission that you need to make to HMRC every time you pay your employees and must be submitted on or before the usual date you […]

Planning A Christmas Party?

Now is the time that many businesses are planning their Christmas celebration for their staff, clients and prospective clients. The cost of a staff party or other annual entertainment is generally allowed as a deduction for tax purposes. If you meet the criteria written below, then there is no need to report anything to HMRC […]

The Annual Investment Allowance

The Annual Investment Allowance (AIA) is a tax relief that was introduced in 2008. The AIA allows for the total amount of qualifying expenditure on plant, machinery, commercial vehicles and other qualifying equipment to be deducted from your profits before tax. The AIA can be claimed by an individual, partnership or company carrying on a […]

Simplified Expenses For Motor Vehicles

There are simplified arrangements in place for the self-employed (and some partnerships) to claim a fixed rate deduction for certain expenses where there is a mix of business and private use. The simplified expenses regime is not available to limited companies or business partnerships involving a limited company. The fixed rate deduction can be used […]

Trading Income Priority Rules

There is specific tax legislation that seeks to determine which charge takes priority where two different charges could potentially apply to the same income. These rules are known as the ‘priority rules’. HMRC manuals state that for Income Tax purposes, savings and investment income, and income otherwise within one of the charges on miscellaneous income, […]

Duty-Free Shopping To Make A Comeback?

The Chancellor of the Exchequer Sajid Javid has said that the Government will reintroduce duty-free shopping with EU countries in the event the UK leaves the EU without a deal. This would mean that passengers travelling to EU  countries would be able to buy beer, spirits, wine and tobacco without duty being applied in the […]

VAT Changes for CIS Sub-contractors delayed

The VAT rule changes for building contractors and sub-contractors that were expected into effect imminently, have been delayed for 12 months until 1 October 2020. This announcement followed intense lobbying by the construction industry who have long argued that many businesses in the sector were unprepared for the change. The planned introduction of the new […]

Visiting EU After 31 October 2019

HMRC has published guidance on visiting the EU after 31 October 2019. They have said that there will be significant changes to the rules for EU travel if there is a no-deal Brexit. This would affect you if you visit the EU, Iceland, Liechtenstein, Norway or Switzerland from the time the UK is due to […]

VAT For Business If There Is A No-Deal Brexit

If the UK leaves the EU on 31 October 2019, without a deal, there will be immediate changes to the procedures that apply to businesses trading with the EU. Listed below are some on the main VAT issues that will affect UK businesses trading with the EU in goods and services: Imports: Businesses that are […]

Enhanced Redundancy Protections for Pregnant Women and New Parents

The government has published its response to its January 2019 consultation on “pregnancy and maternity discrimination: extending redundancy protection for women and new parents” and has confirmed that it will now take action to address such discrimination. As the law currently stands, employees who are placed at risk of redundancy when they’re absent on maternity, […]

Child Benefit Charge If Income Exceeds £50,000

The High Income Child Benefit Charge (HICBC) applies to a parent whose income exceeds £50,000 in a tax year and who is in receipt of Child Benefit. If both parents income exceeds £50,000, the charge will apply to the highest income earner. The charge claws back the financial benefit of receiving Child Benefit either by […]

Keeping Records If Self-Employed

If you are self-employed as a sole trader or as a partner in business partnership, then you must keep suitable business records as well as separate personal records of your income. For tax purposes, the business records must be held for at least 5 years from the 31 January submission deadline for the relevant tax […]

Working After State Pension Age

Many taxpayers reach the State Pension age and continue to work. It should be noted that the requirement to pay any employee or self-employed National Insurance Contributions (NICs) ceases once a taxpayer reaches the State Pension age, subject to the following clarification. Taxpayers remain liable to pay NICs that were due to be paid on […]

When Are Class 1A NICs Due

Class 1A NICs are paid by employers in respect of most benefits in kind provided to employees, for example, the use of a company car. There are no Class 1A employee contributions payable. Class 1A NICs are due in respect of most benefits provided to: directors and certain other persons in controlling positions, employees, members […]

Protecting yourself from an HMRC investigation

A tax investigation is stressful, time consuming and usually very expensive. And it could easily happen to you. HMRC’s investigations are more focused than ever before. During the tax year 2017-18, the tax man collected over £30 billion through ‘compliance activity’. Special investigators are using high tech methods to gain information and maximise tax revenues. […]

Loss Buying Restrictions

Under qualifying circumstances, Corporation Tax relief is available where your company makes a trading loss. The trading loss can be used by offsetting the loss against other gains or profits of your business in the same or previous accounting period. The loss can also be set against future qualifying trading income. However, there are restrictions […]

Tax Free Gifts To Your Spouse Or A Charity

There is usually no Capital Gains Tax (CGT) due on transfer of assets between husbands, wives and civil partners. However, there is still a deemed disposal that has taken place for CGT purposes effectively at no gain or loss on the date of the transfer. When the asset ultimately comes to be sold, the gain […]

When You Can Not Reclaim VAT

For most fully taxable businesses, VAT can be reclaimed on goods and services used in the business. This means businesses must consider where there is any personal or private use of goods or services purchased for the business as the business can only reclaim the business part of the VAT. You cannot reclaim VAT for: […]

Changes To The Employment Allowance

As part of the Autumn Budget 2018 measures it was announced that access to the Employment Allowance was to be restricted. From 6 April 2020, the £3,000 NIC Employment Allowance will only be available to employers with employer NIC liabilities of under £100,000 in the previous tax year. The draft legislation necessary to put this […]

New Cyber Security Guidance Published

The National Cyber Security Centre (NCSC) has published guidance to help small to medium sized organisations prepare their response to, and plan their recovery from a cyber incident. The NCSC define a cyber incident as unauthorised access or attempted access to an organisation’s IT systems. These may be malicious attacks (such as malware infection, ransomware […]

Informing HMRC of Changes In your Personal Details

If your personal details change, you are required to notify HMRC as this can affect your entitlement to certain tax breaks and/or benefits. You need to tell HMRC if: you get married or forma a civil relationship you divorce, separate or stop living with your husband, wife or partner the sooner you tell HMRC the […]

Government Help With Childcare Costs

For many working parents, childcare costs can play a large role when planning to return to work. Now that childcare vouchers have closed to new entrants, we are reminding employers that help is at hand with Tax-Free Childcare, a government scheme to help working parents with the cost of childcare. Eligible parents could get up […]

Free Information About Companies

You can find a surprising amount of free information about companies on Companies House. This is in line with the government’s commitment to free data and ensures that all publicly available digital data held on the UK register of companies is free of charge. This includes: company information such as registered address current and resigned […]

VAT Reverse Charge Construction Industry

A change to the VAT rules first announced at Budget 2018, will come into effect from 1 October 2019. This change will make the supply of construction services between construction or building businesses subject to the domestic reverse charge. the reverse charge will only apply to supplies of specified construction services to other businesses in […]

When Does ATED Apply?

The Annual Tax on Enveloped Dwellings (ATED) came into effect from 1 April 2013. The tax applies to certain Non-Natural Persons (NNPs) that own interests in dwellings valued at more than £500,000. These provisions affect most companies, partnerships with company members and collective investment schemes. There is no ATED or ATED-related Capital Gains Tax payable […]

Do You Have A Complaint For HMRC?

Taxpayers may find themselves in a position where they want to complain to HMRC, for different issues such as poor treatment, unreasonable delays or mistakes. In these circumstances HMRC use a two tier complaint handling process. Tier one is the first attempt to resolve the complaint, if they wish to make a complaint in the first […]

HMRC Cancels Penalties Charged To 6,000 Families

The High Income Child Benefit Charge (HICBC) was introduced in January 2013 and applies a charge to taxpayers whose income exceeds £50,000 in a tax year and who are in receipt of child benefit. The charge claws back the financial benefit of receiving child benefit either by reducing or removing the benefit entirely. HMRC has […]

The Scrappage Scheme

The Mayor of London has launched a scrappage scheme to help tackle London’s air quality crisis. You can claim up to £3,000 off your newer vehicle if your vehicle doesn’t meet the new, stricter Ultra Low Emission Zone standards you will need to pay a daily charge to drive within the zone.Under the scrappage scheme, […]

The Tax Consequences of Social Events

The cost of a staff party or other entertainment is generally allowed as a deduction for tax purposes. As long as you meet the criteria outlined below there is no requirement to report anything to HMRC or pay tax and National Insurance.  An annual Christmas party is not taxable on those attending provided that the […]

Do You Need To Submit A Tax Return?

There are a number of reasons why you may need to register with HMRC to submit a tax return. This could include: if you are self-employed and earning more than £1,000 per year from the self-employed activity, if you are a company director, if you have an annual income over £100,000 and / or if […]

Tax And Lease Premiums

Where a freeholder (or landlord) of a property grants a new lease to a new tenant there are sometimes upfront payments due, usually known as a lease premium. The payments of these premiums are increasingly popular, and the tax implications can be complicated depending on the length of the lease. For leases of 50 years […]

MTD Regulations Relaxed

Starting from April 2019, most VAT-registered businesses that have a taxable turnover over £85,000 are required to keep their VAT records digitally and use Making Tax Digital (MTD) compatible software to submit their VAT return information to HMRC. There are exceptions for certain businesses that have until the first VAT Return period starting on or […]

It’s time for landlords to consider their options

There are two changes to the way Private Residence Relief works that are due to come into effect from April 2020. These changes could reduce the amount of CGT relief available on the sale of a private residence. The government has said that the measures are being introduced to better focus Private Residence Relief at […]

The Help To Save Scheme

The Help to Save scheme is for people on low incomes and was launched in September 2018. The scheme allows those in work entitled to Working Tax Credit and in receipt of Working Tax Credits or Child Tax Credits, to save and receive a 50% government bonus. The scheme is also open to UK residents […]

HMRC Crackdown on estate agents

HMRC have recently launched a new crackdown on money laundering regulation non-compliance by estate agents. This has recently resulted in over 50 visits by HMRC staff to estate agents all over England that were suspected of trading without being registered as required under money laundering regulations. This crackdown includes targeting those who have been trading without […]

Registering as self employed

HMRC’s guidance says that you are probably self-employed if you: run your business for yourself and take responsibility for its success or failure; have several customers at the same time; can decide how, where and when you do your work; can hire other people at your own expense to help you or to do the […]

Maternity Pay Explained

How much maternity leave can you take? If you work as an employee and become pregnant you are eligible to take up to 52 weeks of statutory maternity leave. This is made up of 26 weeks of ordinary maternity leave plus an extra 26 weeks of additional maternity leave. If you give the correct notice […]

Let Property Disclosure Campaign

The Let Property Campaign provides landlords who have undeclared income from residential property lettings in the UK or abroad with an opportunity to regularise their affairs by disclosing any outstanding liabilities, whether due to misunderstanding the tax rules or because of deliberate tax evasion. The campaign was launched in September 2013 and does not currently […]

Business record keeping for the self-employed

If you are self-employed as a sole trader or as a partner in a business partnership, then you must keep suitable business records as well as separate personal records of your income. For tax purposes, the business records must be held for at least 5 years after the 31 January submission deadline for the relevant […]

Making Tax Digital for VAT

The deadline for businesses with a turnover above the VAT threshold to keep digital records for VAT purposes using Making Tax Digital (MTD), is here. For VAT returns periods starting on or after 1 April 2019, businesses with a turnover above the VAT threshold (currently £85,000) will have to: keep their records digitally (for VAT purposes […]

Income Excluded from UK Property Business

Most of our readers will be aware of the £1,000 property income allowance that came into effect on 6 April 2017. This allowance applies to income from property (including foreign property). If your annual gross property income is £1,000 or less, the amount is exempt from tax and doesn’t need to be reported on your […]

Benefits of submitting your tax return early

The 2018-19 tax year ended on 5 April 2019 and the new 2019-20 tax year started on 6 April 2019. Many taxpayers will be tempted to delay dealing with their 2018-19 tax returns until later on this year or near the deadline in January 2020. The 31 January 2020 is not just the final date for submission of […]

Help to save scheme

The Help to Save scheme for people on low incomes was officially launched in September 2018 and since then over 80,000 people have signed up. The scheme allows those in work entitled to Working Tax Credit and in receipt of Working Tax Credits or Child Tax Credits to save up to £50 a month for […]

Landlords under the red light for underpaid and undeclared tax

There was a 51% rise in the number of landlords found to have underpaid or undeclared tax on letting income in 2018. A Freedom of Information request from Telegraph Money revealed the steep rise in residential landlords being pursued by HM Revenue and Customs (HMRC). HMRC’s Let Property campaign saw 8,704 property landlords investigated last […]

Company tax deductions for charitable donations

There are special rules in place when a limited company gives to a charity. This can include Corporation Tax relief for qualifying donations made to registered charities or community amateur sports clubs (CASC), as well as Capital Allowances for giving away equipment that has been used by a company. However, the rules are different if […]

Statutory payment rates for the tax year 2019/20

The following statutory payment rates have been confirmed: The standard weekly rates of Statutory Adoption Pay (SAP), Statutory Paternity Pay (SPP) and Statutory Shared Parental Pay (ShPP) will increase from £145.18 to £148.68 from 01 April 2019. The weekly rate of Statutory Sick Pay (SSP) will increase from £92.05 to £94.25 from 06 April 2019 […]

Cycle to work schemes

There are special rules involving bicycles usually referred to as ‘Cycle to Work’ arrangements. The Cycle to Work scheme was introduced almost 20 years ago to help promote the use of healthy ways to commute to work using an environmentally friendly mode of transport. Employers of all sizes across the public, private and voluntary sectors […]

Lettings relief changes and other exemptions April 2020

Two changes to the way Private Residence Relief works are due to come into effect from April 2020. These changes could reduce the amount of CGT relief available on the sale of a private residence. The changes are: 1.Home owners that let all or part of their house may not benefit from the full Private […]

Pension qualifying earnings band figures and minimum contributions for tax year 2019/20

The Automatic Enrollment Order for 2019 has now been published. As expected, the earnings trigger has remained frozen for another year, which determines when an eligible worker is entitled to be automatically enrolled into a qualifying workplace pension scheme, at £10,000 from 6 April 2019. It also continues to align the qualifying earnings band with National Insurance […]

Tax Due by the end of this month

The 31 January 2019 is not just the final date for submission of your self assessment tax return but also an important date for payment of tax due. This is the final payment deadline for any remaining tax due for the 2017-18 tax year. In addition, the 31 January 2019 is also the payment date […]

7 Ways Self-Employed can prepare for 2019

It’s that time of year when lots of people talk about personal New Year’s resolutions, but it’s also a great opportunity for you to reassess your business aims and objectives if you’re self-employed. We’ve put together a list of seven New Year’s resolutions for the self-employed – read on for what you should consider as […]

Autumn Budget – All you need to know as a Landlord

Following announcements made during Phillip Hammond’s Autumn Budget, we’ve taken a look at the changes landlords could face across the UK – including adjustments to the income tax, personal allowance and higher rate thresholds. Chancellor Hammond opened the 2018 Autumn Budget with a confident prediction that it would “open a new chapter in our country’s […]

What is a company confirmation statement

As well as filing accounts with Companies House, there is a requirement to check that the information Companies House stores about your company is correct every year. This is facilitated by the filing of an annual company confirmation statement. The confirmation statement was introduced in June 2016 and replaced the more cumbersome annual return. A […]

CGT Rollover Relief – ownership of assets

Capital Gains Tax (CGT) rollover relief is a valuable relief that allows for a delay in the payment of CGT on gains when you sell or dispose of certain assets and use all or part of the proceeds to buy new assets. The relief means that the tax on the gain of the old asset […]

MTD for VAT to launch April 2019

The introduction of MTD (Making Tax Digital) for VAT will affect businesses with a turnover above the current VAT threshold of £85,000. These businesses will be required to keep digital records and provide regular digital updates to HMRC for VAT purposes using MTD for VAT. There will be some additional preparation time for a small number […]

Who should submit a Self-Assessment ?

There are a number of reasons why a taxpayer should complete a Self Assessment return. This includes, if they are self-employed, a company director, have an annual income over £100,000 and / or have income from savings, investment or property. Taxpayers that need to complete a Self Assessment return for the first time, should inform HMRC […]

Coding out debts

The coding threshold entitles taxpayers to have tax underpayments collected via their tax code, provided they are in employment or in receipt of a UK-based pension. The coding process applies to certain debts such as Self-Assessment liabilities, tax credit overpayments and outstanding Class 2 NIC contributions. Instead of paying off debts in a lump sum, […]

When to report and pay capital gains tax

The current annual Capital Gains Tax (CGT) exemption for individuals is £11,700 for 2018-19. A husband and wife each benefit from a separate exemption. Same-sex couples who acquire a legal status as civil partners are treated in the same way as married couples for CGT purposes. CGT is normally charged at a simple flat rate […]

VAT Relief on building a new home

The VAT DIY Housebuilders scheme is a special scheme, enabling homeowners building a home to benefit from the special VAT rules that allow the qualifying construction costs of new homes and certain conversion works to be zero-rated. The scheme has been designed to effectively put homeowners in a similar position to a property developer. A […]

Minimum Pension Contribution due to rise again

The minimum contributions you and your staff pay into your automatic enrolment workplace pension scheme will increase from 06 April 2019. This is also sometimes known as phasing. It is your responsibility to make sure these increases are implemented. Who does this apply to? All employers with staff in a pension scheme for automatic enrolment must take […]

Director loans – tax implications

Lending money to your company If you lend money to your company, the tax effects are as follows: – Your company will not pay corporation tax on the money you lend it. – If your company pays you interest on the loan, it will need to deduct income tax at 20% from the interest it […]

Self-employed contractors face National Insurance crackdown under IR35 reform

As part of the Autumn Budget 2018, Chancellor Philip Hammond has announced that reforms to IR35 – which previously hit the public sector – will now be rolled out to private sector businesses, meaning some contractors may see their National Insurance contributions go up. Reforms to the off-payroll working rules were introduced to the public […]

Help-to-Save scheme launched

The new Help to Save scheme for people on low incomes was launched with effect from 12 September 2018 following an 8-month trial. The new scheme allows those in work entitled to Working Tax Credit, and in receipt of Working Tax Credits or Child Tax Credits to save up to £50 a month for two years […]

MTD (Making Tax Digital) Overview

After MTD for VAT has been implemented, MTD for income tax (for the self-employed and those with income from property) and MTD for corporation tax are expected to follow, but not before April 2020 at the earliest. From 01 April 2019 all VAT registered businesses and organisations with taxable turnover above the VAT threshold (currently […]

Self-Assessment Deadlines

The 2017-18 tax return deadline for taxpayers who continue to submit paper Self-Assessment returns, is 31 October 2018. Late submission of a Self-Assessment return will become liable to a £100 late filing penalty. The penalty usually applies even if there is no liability or if any tax due is paid in full by 31 January […]

Capital Gains Tax Rollover Relief

Capital Gains Tax (CGT) Rollover Relief is a valuable relief that allows for a delay in the payment of CGT on gains when you sell or dispose of certain assets and use all or part of the proceeds to buy new assets. The relief means that the tax on the gain of the old asset […]

Fraudulent Emails

HMRC continues to warn taxpayers to be aware of email phishing scams. Phishing emails are used by fraudsters to access recipients’ valuable personal details, such as usernames and passwords. Fake email messages can appear to be genuine but clicking on a link from within the email can result in personal information being compromised and the […]

Employer Pension Contributions

Employer contributions to any type of pension arrangement in a registered pension scheme are always paid gross. Tax relief is given by deducting the gross amount of the contributions from an employer’s taxable profits before Corporation Tax is calculated. Employers’ contributions can normally be treated as a deduction for the accounting period in which the contribution […]

Tax Free Health Benefits

There is no requirement for employers to pay tax and National Insurance on certain health benefits covered by tax concessions or exemptions. For example, there is no requirement to report employees’ medical or dental treatment or insurance if they are a part of a salary sacrifice arrangement. In addition, the following health benefits can be […]

Late Filing PAYE Penalties

There are late filing penalties in place for employers that don’t report payroll information on time. The size of the late filing penalties depends on the number of employees within the PAYE scheme. Number of employees Monthly filing penalty per PAYE scheme 1 to 9 £100 10 to 49 £200 50 to 249 £300 250 […]

HMRC Security Deposit Regime to be Extended

The security deposit legislation is to be extended to both Corporation Tax and Construction Industry Scheme (CIS) deductions from April 2019. The security deposit regime allows HMRC to require security from high-risk businesses where there is a serious risk that taxes owed will not be paid. At present HMRC’s security deposit powers only apply to VAT, PAYE […]

Claiming Employment Allowance

The employment allowance of £3,000 per year, is available to most businesses and charities to be offset against their employers Class 1 NIC bill. The allowance can be claimed as part of the normal payroll process. An employer can claim less than the maximum if this will cover their total Class 1 NIC bill. Eligible […]

Allowable costs for property businesses

Costs that can be deducted by individuals that have a property rental business, depend on the type of property that is being rented out. There are three main categories of property business that need to be considered. Residential properties This is by far the most common type of investment property held by individuals. Tax relief can be […]

ISA – HELP TO BUY

The Help to Buy: ISA scheme launched in December 2015 and allows savers to claim a government bonus of 25% on monthly savings of up to £200 towards their first home. The bonus translates to: an extra £50 added to every £200 saved up to a maximum governmental contribution of £3,000 on £12,000 worth of […]

Non-taxable payments and benefits

Although the government is continually clamping down on non-taxable payment and benefits for employees, there remains an eclectic list of expenses that are tax exempt. Some of the non-taxable benefits include the following: Annual parties. An annual Christmas party or other annual event offered to staff generally is not taxable on those attending, provided that […]

Claiming Marriage Allowance

The marriage allowance allows couples to share part of their personal tax-free allowance in certain circumstances. The marriage allowance is available to married couples and those in a civil partnership where one partner has an unused personal allowance and their spouse/partner only pays Income Tax at the basic rate. HMRC has published a press release […]

Rent a Room Relief to be Modified

The publication of the draft Finance Bill 2018-19 includes legislation to change the way the rent-a-room relief scheme works. Following last year’s Budget, a consultation was launched by HM Treasury to examine the design of the rent-a-room scheme. When the relief was first launched it was intended to be used where one bedroom in a […]

Maternity Allowance

The maternity allowance is a financial benefit for pregnant women who are self-employed, who are working but do not qualify for statutory maternity pay (SMP) or who have recently stopped working. The maternity allowance is paid directly by the Department for Work and Pensions for up to 39 weeks for qualifying applicants. An application must be […]

Gifts with Complications

Most gifts made during a person’s lifetime are not subject to tax at the time of the gift. The lifetime transfers are known as ‘potentially exempt transfers’ or ‘PETs’. These gifts or transfers achieve their potential of becoming exempt from Inheritance Tax if the taxpayer survives for more than seven years after making the gift. […]

Employee expenses covered by exemption

There is no longer a requirement to report certain routine expenses to HMRC. The types of expenses and benefits covered are referred to as exemptions and have replaced dispensations which can no longer be applied for. The business expenses and benefits that no longer need to be reported (since April 2016) include reimbursed costs to […]

VAT reverse charge could hit the construction sector

HMRC has launched a new consultation inviting comments from interested parties regarding the introduction of new VAT reverse charge legislation for certain construction services. The new legislation will make the supply of construction services between construction or building businesses subject to the domestic reverse charge. This move is part of the government’s measures to combat […]

Tax-Free childcare in the school holidays

HMRC is reminding parents that the Tax-Free Childcare (TFC) scheme can help balance work and school holiday childcare. The TFC scheme helps support working families with their childcare costs and can be used to pay for regulated holiday clubs during the school holidays. The TFC scheme provides for a government top-up on parental contributions. For every […]

National Minimum Wage & Living Wage

An HMRC investigation has discovered that for 2017/18 £15.6 million back pay is owed to over 200,000 UK workers, this was an increase from £10.9 million to 98,000 workers for 2016/17. Employers who don’t pay their staff the legal requirements are subjected to penalties. If an employer realises that they have underpaid their worker they […]

Are You Due A Tax Refund?

HMRC has a guidance that lets you know if you are due and tax refund and how to claim that refund. According to HMRC you may be able to claim a refund if you: are employed and had too much tax taken from your pay; have stopped work; sent a tax return and paid too […]

Claiming Tax Relief on Pensions

The annual allowance for tax relief on pensions is £40,000 for the current tax year. There is also a three year carry forward rule that allows taxpayers to carry forward unused annual allowance from the last three tax years if they have made pension savings in those years. Qualifying taxpayers can get tax relief on […]

The Pensions Regulator to Seize Assets

The Pensions Regulator (TPR) has announced that employers who refuse to pay workplace pension fines could have their assets seized to pay their debts. TPR can issue fines to employers who fail to meet their automatic enrolment duties and can secure court orders if the debts are not then paid. TPR is to now appoint […]

Tax On Lodger’s Rent

The rent-a-room scheme is a set of special rules designed to help homeowners who rent-a-room in their home. Homeowners pay no tax on lodger’s rent up to £7,500. This tax relief applies to the letting/renting of furnished accommodation and is usually used when one bedroom in a home is rented out to a lodger for an […]

Protect Your Home Address

New laws have come into effect (from 26 April 2018) to help tackle the problem of identity fraud and personal harm for company directors. The new laws, which were introduced into parliament on 22 February 2018, allow company directors and others such as secretaries, people with significant control (PSC) and LLP members, to remove their […]

Making Money From A Hobby

The ‘badges of trade’ tests whilst not conclusive are used by HMRC to help determine whether an activity is a proper economic / business activity or just a money-making side line to a hobby. However, there is a point where careful consideration needs to be given to deciding whether your hobby has in fact become […]

Company Van Use

There are various tax consequences involved when employees are provided with company vans and fuel. A company van can be described as a van made available to an employee by reason of their employment. There is usually nothing to report to HMRC if the van is used solely for business use, as a pool van […]

Keeping up with Payroll & Auto- Enrolment

Staying on top of payroll can be a huge task for all businesses of different sizes – which is why we advise you seek specialist advice to ensure everything is correct and running smoothly. Tax & National Insurance Contributions legislation are always changing, as are the National Living Wage (NLW) and auto-enrolment pensions contributions. These […]

Dividend Allowance

Dividend allowance cut from £5,000 to £2,000 From 6 April, the tax-free dividend allowance will be cut from £5,000 to £2,000, this was introduced in the 2017 Budget. The move will impact employees and directors of small businesses who pay themselves partly or wholly through dividends rather than a salary. It could also impact investors […]

Spring Statement 2018

Philip Hammond, the Chancellor of the Exchequer, stood up in Parliament at 12.34pm on Tuesday 13th March, to deliver his first – already heralded as ‘slimmed down’ – Spring Statement. He had forewarned the media and Parliament that he would not be making any specific tax or spending changes. These, together with any new governmental […]

Preparing for the General Data Protection (GDPR)

10 steps to take now 1 – Awareness You should make sure that decision makers and key people in your organisation are aware that the law is changing to the GDPR. They need to appreciate the impact this is likely to have. 2 – Information you hold You should document what personal data you hold, […]

Dates To Remember April – June 2018

2018/2019 financial year starts 7 April 2018 Deadline for VAT returns and payments of Accounting Quarter period ending 28 February 2018 14 April 2018 Income tax due date for CT61 period to 31 March 2018 17 April 2018 March inflation figures released The inflation figures from March 2018 will be released today. This will be […]

MTD (Making Tax Digital) Update

WHAT’S GOING ON? Two years ago, it was proposed that Her Majesty’s Revenue and Customs (HMRC) was to move to a fully digital based tax system. By the end of the 2020/21 tax year the way that businesses, including landlords, currently interact and liaise with HMRC will change beyond all recognition. This initiative is known […]

SOLE TRADER VS LIMITED COMPANY

THE DIFFERENCES BETWEEN A SOLE TRADER AND A LIMITED COMPANY This document should help you answer some important questions, including; “what is a sole trader business?” and “what is a limited company?” and the differences between the two. Starting up as a sole trader is without doubt the simplest way to start a business in […]

Dates to Remember October – December 2017

05 October 2017 Deadline to register with the HMRC if you became self-employed or started receiving income from property. You should submit a form CWF1 for self-employment or form SA1 for non-self-employed income to HMRC. 05 October 2017 Deadline for notifying HMRC of new sources of taxable income or gains or liability to the High […]

Making Tax Digital (MTD)

The government has announced a revised timetable for the introduction of Making Tax Digital for Business (MTDfB). MTDfB introduces extreme changes to how taxpayers record and report income to HMRC. Unincorporated businesses, including landlords, were expected to be the first to see significant changes in the recording and submission of business transactions but the government […]

Time for a New Accountant

It can be difficult to know what you expect from your accountant. This makes it hard to decide if it’s time to look for a new accountant Do you get on with your accountant? Although this may seem irrelevant, it’s essential. Feeling at ease with your accountant is important. You should feel that you can […]

How to get those invoices paid quickly …

The problems faced by small businesses due to late payments have been very much in the news lately, as a business owner you are very aware of the importance of getting paid on time and that payment delays can seriously disrupt cash flow. When searching for ways to speed up payment, keep in mind that […]

5 Easy Ways to Improve Cash Flow

Ever felt like you’ve got plenty of work but not enough cash coming in? Achieving good cash flow is not a black art. Here are some easy ways to improve cash flow. The goal is always to make sure you’ve got more money coming in than you have going out.

How to Pay Yourself Efficiently

If you’re a limited company, the amount of money you pay yourself determines the size of your tax bill. When you pay a salary, this cuts into profits and therefore lowers the amount of Corporation Tax you pay each year. A combination of salary, dividends and bonuses is a way of ensuring you pay yourself enough to live on as an owner-manager or a contractor. But how do you know how much to take in salary and dividends? What’s the most tax efficient way to pay yourself and when do you do it? There are a few different options to consider. Ultimately, your accountant will look at your business closely and advise on the way that best suits you. As the government tinkers with the rules most years, it’s always wise to check before going ahead.

How to Make Smart Business Decisions

Decisions, decisions! How do you make smart business decisions? Do you use your head, your heart or both? What if your gut instinct is pushing you in a certain direction? Do you follow it or stick to the facts?

5 Tax-Efficient Ways to Reward Your Employees

Increasing salary is far from the only way to make employees feel valued. If you want to reward your employees in tax-efficient ways, explore what’s commonly known as benefits in kind (BiKs) and salary sacrifice. The idea is that instead of an increase in salary, the employer offers benefits and other options specifically intended to improve the working lives of the employees. Here are five suggestions that could help. It’s also worth remembering that being known as an employer that rewards employees is a great way of attracting and keeping the best talent.

Do I Need Management Accounts?

Well, yes! Ok, so as accountants maybe we’re a teeny bit biased but we’re prepared to back up this answer with some good, solid reasons that will give you plenty of food for thought. The first of which is this: to become a management accountant and produce a set of accurate and useful management accounts that actively seek ways to boost profit, you need qualifications backed up by hands-on experience. So, your management accountant will know the theory, rules and regulations, and be able to put it all into practice in a way that best suits your business because he or she has plenty of real world experience doing exactly that.

5 Simple and Legitimate Ways to Make Tax Savings

Everyone has to pay tax on earnings and assets. But how do you make tax savings? When inflation rises or National Insurance contributions go up, so does your tax bill. Here’s the good news: if you abide by the rules but take time to do some financial forward planning, you can stop those bills getting completely out of control. Here are 10 ways you can make tax savings without upsetting the taxman, and legitimately not pay any more than you’re actually required to.