Blog

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.