News

The latest breaking news in the industry!

20-02-2019

New Stamp Duty surcharge announced

A new consultation has been launched by HM Treasury together with HMRC seeking views on the design of a new 1% Stamp Duty Land Tax (SDLT) surcharge on non-UK residents purchasing residential property in England and Northern Ireland. This move was first mooted in the Budget 2018. The consultation closes for comments on 6 May 2019. The consultation document makes it clear that the new SDLT ... read more

20-02-2019

Edinburgh makes a case for UK’s first tourist tax

The City of Edinburgh Council is seeking permission to introduce a tourist tax. After an extensive consultation, the members of Edinburgh Council have agreed to submit proposals to the Scottish Government. The City Council voted in favour of the proposal by a margin of 43 to 15. The Scottish government, that had previously been against such a tax, has agreed to further consultations on the issue. ... read more

20-02-2019

Did you get your Brexit update letter from HMRC?

HMRC has now written to over 145,000 VAT-registered businesses across the UK with a Brexit update. The letters explain changes to customs, excise and VAT in the event that the UK leaves the EU without a deal, and what businesses can do to prepare. There are a number of different versions of the letters some of which are specific to the circumstances of businesses in Northern Ireland. If the UK ... read more

20-02-2019

Election to treat property as main residence

There are a number of issues that owners of more than one home should be aware of. An individual, married couple or those in a civil partnership can only benefit from CGT on one property at a time. However, it is possible to choose, by election, which property is treated as a main residence and therefore benefits from a CGT exemption when sold. When a home owner lives in more than one property, ... read more

20-02-2019

Joint ventures and VAT

A joint venture is a commercial enterprise undertaken by two or more parties who otherwise retain their own separate identities. The parties to the joint venture usually bring together different resources and areas of expertise to help fulfil a specific project or business activity. HMRC’s published guidance on how a joint venture is treated for VAT is as follows. Where two or more separate ... read more

20-02-2019

Filing deadlines for company accounts

After the end of its financial year, a private limited company must prepare full annual accounts and a company tax return. The deadline for filing the first set of accounts with Companies House is 21 months after the date the company was registered with Companies House. Annual accounts must be submitted 9 months after the company’s financial year ends. There is a fixed date for the payment of ... read more

20-02-2019

Did you miss the self-assessment deadline?

Are you among the 700,000 taxpayers that missed the 31 January 2019 filing deadline for your 2017-18 self-assessment returns? If you missed the filing deadline then you will be charged a £100 fixed penalty if your return is up to 3 months late, regardless of whether you owed tax or not. If you do not file and pay before 1 May 2019 then you will face far greater penalties. A daily penalty of £10 ... read more

20-02-2019

Finance Bill receives Royal Assent

The Finance (No.3) Bill 2017-19 received Royal Assent (later than originally planned) on 12 February 2019 following agreement by both Houses on the text of the Bill. The Bill is now an Act of Parliament known as Finance Act 2019. The Act contains the legislation for many of the tax measures announced by the government at Autumn Budget 2017 some of which had been the subject of further ... read more

13-02-2019

Gifts out of disposable income

There is an annual Inheritance Tax exemption of £3,000 for gifts. This exemption can also be carried forward to the following tax year if not used to make a maximum gift of £6,000. You can also give unlimited individual gifts of up to £250 per person during the tax year, but only if you haven’t used another exemption on the same person. There are additional, special allowances for gifts made at a ... read more

13-02-2019

What work is covered by the CIS scheme?

The Construction Industry Scheme (CIS) is a set of special rules for tax and National Insurance for those working in the construction industry. Businesses in the construction industry are known as 'contractors' and 'subcontractors'. Under the scheme, contractors deduct money from subcontractors' payments and pass it to HMRC. Contractors are defined as those who pay subcontractors for ... read more

13-02-2019

When do you pay Capital Gains Tax?

Capital Gains Tax (CGT) is normally charged at a simple flat rate of 20% and this applies to most chargeable gains made by individuals. However, if you only pay basic rate tax and make a small capital gain, you may only be subject to a reduced rate of 10%. Once the total of your taxable income and gains exceed the higher rate threshold, the excess will be subject to 20% CGT. A higher rate of CGT ... read more

13-02-2019

Class 4 NICs who is liable?

There are two types of National Insurance Contributions (NICs) payable by most self-employed people. These are known as Class 2 NICs and Class 4 NICs. Class 2 NICs are paid by all self-employed taxpayers unless they qualify for the small earnings exception or other exemptions which remove the necessity to pay NICs. Class 2 NICs are payable at a flat weekly rate. In addition, most self-employed ... read more

13-02-2019

Reduction in special Writing Down Allowance

Businesses can claim Capital Allowances tax relief for certain types of capital expenditure. For expenditure on plant and machinery that exceeds the Annual Investment Allowance (AIA) and does not qualify for a first year allowance, a standard 18% Writing Down Allowance (WDA) is available. This is based on the cost of the items in the year they are acquired. There is a lower rate known as the ... read more

13-02-2019

EIS Income Tax relief restriction for connected parties

The Enterprise Investment Scheme (EIS) is designed to help smaller higher-risk trading companies raise finance by offering a range of tax reliefs to investors who purchase new shares in those companies. In order for investors to be able to claim EIS tax reliefs, the company which issues the shares has to meet a number of rules regarding the kind of company it is, the amount of money it can ... read more

13-02-2019

Tax codes for employees

The P9X form is used to notify employers of the tax code to use for employees. The form shows the tax codes to use from 6 April 2019. The basic Personal Allowance for the tax year starting 6 April 2019 will be £12,500 and the tax code for emergency will be 1250L. The basic rate limit is £37,500 except for those defined as Scottish taxpayers who have a lower basic rate limit as well as an ... read more

06-02-2019

Alcohol duty freeze confirmed

The Chancellor, Philip Hammond recently paid a visit to an independent brewery in Liverpool and confirmed that the duty rates on beers, spirits and most ciders will be frozen at the current rates for another year from 1 February 2019. These measures mean that the average price for a bottle of whisky will be £1.50 less and a pint of beer 14p less than if the rates had increased as expected based on ... read more

06-02-2019

Will you pay tax on your inheritance?

If you inherit property, money or shares you are usually not liable to pay tax on the inheritance. This is because any Inheritance Tax (IHT) due should be paid out of the deceased’s estate before any cash or assets are distributed to the heirs. There is normally no tax to be paid by the deceased’s estate if the value of the estate is below the IHT nil rate threshold of £325,000. There is also an ... read more

06-02-2019

Struggling to pay your January tax bill?

Have you missed the 31 January 2019 deadline for paying your tax bill? The 31 January was not just the final date for submission of your Self Assessment tax return but also an important date for payment of other tax due. This included the payment of any Capital Gains Tax due in relation to the 2017-18 tax year, and also the due date for your first payment on account for 2018-19. If you were ... read more

06-02-2019

Spring Statement 2019

The Chancellor, Philip Hammond, has announced that he will deliver his Spring Statement to the House of Commons on Wednesday, 13 March 2019. The timing of the statement is interesting as the Spring Statement is due to take place just over 2 weeks before the 29 March Brexit withdrawal date. This will be the second Spring Statement to take place following the government’s decision to switch to a ... read more

06-02-2019

MTD pilot for self-employed is available

The introduction of Making Tax Digital (MTD) will fundamentally change the way businesses, the self-employed and landlords interact with HMRC. The new regime will require businesses and individuals to register, file, pay and update their information using a new online tax account. The new regime is due to start in April 2019, for VAT purposes only, when some 1 million businesses with a turnover ... read more

06-02-2019

Claiming money or property from a dissolved company

Any property, cash and other asset owned by a company when it is dissolved automatically passes to the Crown as ownerless property. This process is known as 'bona vacantia' which literally means vacant goods. The bodies that deal with bona vacantia claims vary across the United Kingdom, but they all ultimately represent the Crown. There are a number of scenarios where you may be able to claim or ... read more

06-02-2019

Checking your NIC records

HMRC offers an online service to check your National Insurance Contributions (NIC) record online. In order to use the service, you will need to have a Government Gateway account. If you don't have an account, you can apply to set one up online. By signing in to the 'Check your National Insurance record' service you will also activate your personal tax account if you haven’t already done so. The ... read more

29-01-2019

Maximum AIA calculations for split accounting periods

The recent, and temporary, increase in the AIA to £1m from 1 January 2019 creates computational issues if a trader's accounting period straddles this date. The following example published by HMRC illustrates one variant that you may encounter when considering AIA relief due to clients. Where a business has a chargeable period from 1 July 2018 to 30 June 2019, the maximum AIA for this period ... read more

29-01-2019

Who pays Income Tax in Scotland?

According to HMRC, individuals pay Scottish Income Tax if they live in Scotland. Care should be taken when considering the phrase "live in Scotland". In particular, you may also pay Scottish Income Tax if you: - move to or from Scotland,- live in a home in Scotland and one elsewhere in the UK, for example for work,- don’t have a home and stay in Scotland regularly, for example you stay offshore ... read more

29-01-2019

Charities - reducing input VAT

Charities pay VAT on all standard-rated goods and services they buy from VAT-registered businesses. They pay VAT at a reduced rate (5%) or the ‘zero rate’ on some goods and services. Charities pays 5% VAT on fuel and power if they’re for: residential accommodation (for example, a children’s home or care home for the elderly), charitable non-business activities (for example, free daycare for ... read more

29-01-2019

Brexit – what the UK government has advised business owners to do

The Brexit uncertainties continue. To help businesses consider their options HMRC has published more information for UK businesses that buy or sell goods from or to the EU. We have copied in below three specific actions that need to be considered and updated them for recent changes to the information available on the GOV.UK website. They are: Complete an application and register for a UK ... read more

29-01-2019

Sooner is better than later

Last week we passed the filing deadline (31 January 2019) for the 2017-18 self assessment tax returns. A surprising number of taxpayers are still content to deal with this annual chore at the last minute. This article sets out a few compelling reasons for preparing your tax return as soon as you can after the end of each tax year. Until you prepare your return and calculate your liability for a ... read more

29-01-2019

What is taxable when you sell a commercial vehicle or other equipment?

When you purchase a van or other equipment that qualifies for tax relief, the cost of the asset is reduced - for tax purposes - by the amount of any capital allowance you claim. Consequently, if you sell the asset at a later date you will need to compare the tax written down value (cost minus any capital allowances claimed) with the sales proceeds. If the amount you receive on sale is higher ... read more

23-01-2019

HMRC publishes more strange excuses

A recent press release by HMRC revealed some of the oddest excuses for submitting a late tax return. The excuses ranged from the sublime to the ridiculous and included: My mother-in-law is a witch and put a curse on me. I’m too short to reach the post box. I was just too busy – my first maid left, my second maid stole from me, and my third maid was very slow to learn. Our junior member of ... read more

23-01-2019

Avoid car-fuel benefit charge for 2018-19

The easiest way to ensure that no car-fuel benefit charge (for private journeys in a company car) is payable, is to use the advisory fuel rates published by HMRC to repay any private fuel costs to your employer. The advisory fuel rates are intended to reflect actual average fuel costs and are updated quarterly. However, the car-fuel benefit charge will still be payable if it cannot be ... read more

23-01-2019

On your bike – 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 are eligible to take part in the scheme with the proviso ... read more

23-01-2019

Lifetime transfers where estate of another individual is increased

Most gifts made during a person's life are not subject to tax at the time of the gift. These lifetime transfers are known as 'potentially exempt transfers' or 'PETs'. These gifts or transfers achieve their potential of becoming exempt if the taxpayer survives for more than seven years after making the gift. If the taxpayer dies within 3 years of making the gift, then the Inheritance Tax position ... read more

23-01-2019

Changes to lettings relief 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: Home owners that let all or part of their house may not benefit from the full Private Residence Relief, but can benefit from letting relief of up to £40,000 (£80,000 for a couple). ... read more

23-01-2019

CGT relief for two dwellings for the same period

As a general rule, there is no Capital Gains Tax (CGT) on a property which has been used wholly as a main family residence. This relief from CGT is commonly known as Private Residence Relief. Conversely, an investment property that has never been used as a main residence will not qualify. It is not uncommon for taxpayers to own more than one home, and there are a number of issues that home ... read more

23-01-2019

Welsh rates of Income Tax

The Welsh Government has confirmed that the proposed Welsh Government Budget has been ratified and that the new Welsh rates of Income Tax (WRIT) will be set at 10p for 2019-20. This means that the rates of Income Tax paid by Welsh taxpayers will continue to be the same as those paid by English and Northern Irish taxpayers when the WRIT is introduced. The WRIT will be payable on the non-savings ... read more

22-01-2019

Tax Diary February/March 2019

1 February 2019 - Due date for Corporation Tax payable for the year ended 30 April 2018. 19 February 2019 - PAYE and NIC deductions due for month ended 5 February 2019. (If you pay your tax electronically the due date is 22 February 2019) 19 February 2019 - Filing deadline for the CIS300 monthly return for the month ended 5 February 2019. 19 February 2019 - CIS tax deducted for the month ended ... read more

22-01-2019

Auto-enrolment qualifying earnings band figures for tax year 2019/20 confirmed

The draft Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2019 has now been published. As expected, it freezes the earnings trigger, 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 ... read more

22-01-2019

Statutory payment rates for tax year 2019/20 confirmed

The following statutory payment rates are 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 1 April 2019. The weekly rate of Statutory Sick Pay (SSP) will increase from £92.05 to £94.25 from 6 April 2019 and the standard weekly rate of Statutory Maternity Pay (SMP) ... read more

22-01-2019

EU Settlement Scheme fee is to be scrapped

The Prime Minister has announced in a speech to the House of Commons that the £65 fee for applications made by EU citizens under the EU Settlement Scheme is to be waived. The scheme is due to be rolled out in full on 30 March 2019 and at that stage there will be no fee charged. Currently, the scheme is in a public pilot test phase (following two private test phases) and the Prime Minister has also ... read more

16-01-2019

Don’t overclaim for equipment purchases

You can use the Annual Investment Allowance (AIA) to claim a very generous 100% first year tax relief for qualifying expenditure on plant and machinery. The allowance is available for most assets purchased by a business but does not apply to cars. The AIA was set at £200,000 per calendar year for all qualifying expenditure on or after 1 January 2016. However, there is a new temporary increase in ... read more

16-01-2019

Reducing payments on account

Taxpayers are usually required to pay their Income Tax liabilities in three instalments each year. The first two payments are due on: 31 January during the tax year e.g. for 2018-19 the first payment on account is due on 31 January 2019. 31 July following the tax year e.g. for 2018-19 the second payment on account is due on 31 July 2019. These payments on account are based on 50% of the ... read more

16-01-2019

Could you claim the Marriage Allowance?

If you or your partner are a low earner or not working, then you may be eligible for the Marriage Allowance (MA). The MA allows lower earning couples to share part of their personal tax-free allowance. The MA is available to married couples and those in a civil partnership where a spouse or civil partner doesn’t pay tax or who has an income below the personal allowance (for 2018-19 this amounts to ... read more

16-01-2019

Carry back charitable contributions

Donations to charity over the course of a tax year can add up and taxpayers must ensure they keep a proper record of all donations to backup tax return entries. Donations that are made through the Gift Aid scheme allow for the recipient charity to claim 25p worth of tax relief on every pound donated. Higher rate and additional rate taxpayers are eligible to claim relief on the difference between ... read more

16-01-2019

Remaining age related tax allowances

Most age related tax allowances have been phased out. However, the Married Couple's Allowance (MCA) is available to elderly married couples or those in a civil partnership where at least one member of the couple were born before 6 April 1935. The allowance provides for tax relief by deducting 10% of the allowance from the amount of tax due on taxable income. The MCA can reduce a tax bill to zero ... read more

16-01-2019

Tax if clients leave the UK to live abroad

The P85 form should be completed by individuals or their agents to advise HMRC that have left the UK to live or are going to work abroad for at least one full tax year. The completion of the P85 form will ensure that an individual leaving the UK can claim any tax refund they are entitled to and will also help HMRC decide how an individual should be treated for the purposes of UK tax. The ... read more

09-01-2019

Automatic enrolment for the self-employed?

The government has confirmed that they are to examine a number of different approaches to help encourage the self-employed to save for their retirement. The success of automatic enrolment for pension savings for the employed has helped highlight that pension savings for the self-employed are lagging behind those achieved for the employed. In fact, government research has shown that only around 14% ... read more

09-01-2019

New 'global' pound coin

HM Treasury has confirmed that the £1 coin will be going global. This announcement means that the UK’s Overseas Territories and Crown Dependencies will be able to design and mint their own versions of the 12-sided £1 coin replacing the older coins. The coins are expected to feature images celebrating the heritage of these territories, with their history and culture pictured on the reverse side. ... read more

09-01-2019

Check if your holiday let property is qualifying

The Furnished Holiday Let (FHL) rules, allow holiday lettings of properties that meet certain conditions to be treated as a trade for some specific tax purposes. In order to qualify as a furnished holiday letting, the following criteria need to be met: The property must be let on a commercial basis with a view to the realisation of profits. Second homes or properties that are only let ... read more

09-01-2019

Register a company and register for tax

A new one-stop service to register a company and register for tax at the same time has been used by more than 200,000 businesses since it was introduced. The introduction of the Streamlined Company Registration Service was announced as part of the Small Business, Enterprise and Employment Act 2015 to help reduce administrative burdens and came into effect last year. However, there remain many new ... read more

09-01-2019

Changes to a building after the VAT option to tax

There are special VAT rules that allow businesses to standard rate the supply of most non-residential and commercial land and buildings (known as the option to tax). This means that subsequent supplies by the person making the option to tax will be subject to VAT at the standard rate. The ability to convert the treatment of VAT exempt land and buildings to taxable can have many benefits. The main ... read more

09-01-2019

Cash basis option for landlords

The cash basis scheme helps sole traders and other unincorporated businesses benefit from a simpler way of managing their financial affairs. The scheme was extended to landlords from April 2017. The scheme is not open to limited companies and limited liability partnerships. The entry threshold for the cash basis scheme is £150,000 and you can stay in the scheme until your business turnover reaches ... read more

09-01-2019

Genuine messages from HMRC

HMRC has issued an updated version of their online guidance on Genuine HMRC contact and recognising phishing emails and texts. The guidance provides a current list of genuine messages from HMRC. This includes: email messages, text messages and telephone contacts from HMRC. The latest updates on the list include information on a research project being carried out to see how businesses are ... read more

02-01-2019

Did you file your tax return Christmas Day?

A new press release by HMRC has highlighted that 2,616 taxpayers took the time to file their tax return online on Christmas Day with a further 8,465 taxpayers completing their tax returns on Boxing Day. More than 11 million taxpayers are expected to complete a 2017-18 self assessment tax return this year. Taxpayers are reminded that the deadline for submitting the 2017-18 self assessment tax ... read more

02-01-2019

Don’t forget to pay your tax at the end of the 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 for any Capital Gains Tax due in relation to the 2017-18 tax year and the due date for the first payment on ... read more

02-01-2019

Paying young people and children

When a new employee is added to the payroll it is the employers' responsibility to ensure they meet the employees’ rights and deduct the correct amount of tax from their salary. This includes any employees who are family members. It is possible to employ young people if they are 13 or over but there are special rules about how long they can work and what jobs they can do. Children younger than ... read more

02-01-2019

Finance Bill delay

The government published Finance (No.3) Bill 2017-19 on Wednesday, 7 November 2018. The Bill is so named as it is the third Finance Bill in the current special two-year session of Parliament. The Bill, colloquially known as Finance Bill 2018-19 will become Finance Act 2019 after Royal Assent is received which is expected in March 2019 before the Brexit deadline. The progress of the Bill through ... read more

02-01-2019

Merchandise in Baggage

There are special customs requirements for commercial goods or samples which are imported or exported by passengers in their accompanied baggage (hand carried). This is known as Merchandise In Baggage or MIB. MIB goods include the following: goods acquired for company use goods for sale spare parts trade samples whether or not they are: permanently imported/exported temporarily ... read more

02-01-2019

Checking a National Insurance Record

HMRC offers an online service to check a National Insurance record. In order to use the service you will need to have a Government Gateway account. If you don't have an account, you can apply to set one up online. By signing in to the 'Check your National Insurance record' service you will also activate your personal tax account if you haven’t already done so. The personal tax account can be ... read more

02-01-2019

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 is postponed. The amount of the gain is effectively rolled over into the cost of the new asset and any CGT liability is ... read more

02-01-2019

New legislation implementing aspects of the Good Work Plan

Following the recent publication of its “Good Work Plan”, the government has now laid before Parliament three statutory instruments to implement certain aspects of that Plan. The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 and the draft Employment Rights (Miscellaneous Amendments) Regulations 2019 will both come into force for the most part on 6 ... read more

02-01-2019

Naming scheme for unpaid employment tribunal awards launched

The government’s recently published “Good Work Plan” included a commitment to establish a naming and shaming scheme for those employers who fail to pay employment tribunal awards. Immediately following publication of the Good Work Plan, the government introduced the scheme and published guidance on how it operates. The names of employers, together with the amount of the employment tribunal award ... read more

02-01-2019

Guidance for employers on new payslip legislation

New legislation comes into force from 6 April 2019 which requires all employers to provide an itemised payslip to all workers, i.e. not just to employees, and to show hours on payslips where the pay varies by the amount of time worked. The government has now published guidance to help employers with the new rules on showing the hours on payslips, which includes several useful example case ... read more

19-12-2018

Advise HMRC if you stop being self-employed

Any taxpayers that have ceased to be self-employed must advise HMRC of their change in status. There are a number of steps that must be followed if a taxpayer stops trading as a sole trader or if they are ending or leaving a business partnership. This is required so that HMRC can help to get the taxpayer's affairs in order. Taxpayers must send in a Self Assessment return by the relevant deadline ... read more

19-12-2018

Check your State Pension age

A 'Check your State Pension age' tool is available at www.gov.uk/state-pension-age/y. The tool allows taxpayers to check the earliest age they can start receiving the State Pension. The State Pension age is based on a taxpayer’s gender and date of birth and is subject to change as the State Pension age increases. The tool can also be used to check a taxpayer's Pension Credit qualifying age and ... read more

19-12-2018

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 confirmation statement must usually be filed ... read more

19-12-2018

A further £2bn allocated to Brexit planning

The government has announced more than £2 billion in additional funding across 25 government departments to help with Brexit planning. This brings the total amount provided by the government for EU exit preparations since 2016 to £4.2 billion. The government has apparently been left with no choice but to step up no-deal Brexit contingency plans. There are now less than 100 days to go to the ... read more

19-12-2018

What expenditure qualifies for the Annual Investment Allowance?

The Annual Investment Allowance (AIA) was permanently set at £200,000 for all qualifying expenditure on or after 1 January 2016. However, in the Budget earlier this year, the Chancellor announced a temporary increase in the allowance to £1 million for a 2-year period from 1 January 2019 to 31 December 2020. The AIA allows for 100% first year tax relief for qualifying expenditure on plant and ... read more

19-12-2018

Maternity pay and leave

Employees that are pregnant are eligible to take up to 26 weeks of statutory maternity leave (known as ordinary maternity leave) plus an additional 26 weeks (known as additional maternity leave). This means that an employee can take up to a full year off once they give their employers the correct notice. All women employees are entitled to both classes of maternity leave from day one of their ... read more

19-12-2018

Benefits that don’t have to be reported to HMRC

There is no 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 no longer apply. The business expenses and benefits that do not need to be reported (since April 2016) include: reimbursed costs to employees covering business travel, phone bills, business entertainment expenses and ... read more

19-12-2018

VAT notes – new edition published

HMRC has published what appears to be the final online quarterly edition of VAT notes which includes a summary of recent changes to the VAT rules. HRMC has confirmed that from January 2019 'VAT Notes' will no longer be published online as VAT updates are published in real time on GOV.UK. The small number of businesses that are exempt from online filing will continue to receive a printed version of ... read more

18-12-2018

Tax Diary January/February 2019

1 January 2019 - Due date for Corporation Tax due for the year ended 31 March 2018. 19 January 2019 - PAYE and NIC deductions due for month ended 5 January 2019. (If you pay your tax electronically the due date is 22 January 2019) 19 January 2019 - Filing deadline for the CIS300 monthly return for the month ended 5 January 2019. 19 January 2019 - CIS tax deducted for the month ended 5 January ... read more

18-12-2018

Amendments to UK data protection law in the event of a no deal Brexit

Following the publication of its technical notice in September 2018 on “Data protection if there’s no Brexit deal”, the government has now published an online summary covering what amendments would be required to UK data protection law in the event of a no deal Brexit. The European Union (Withdrawal) Act 2018 (EUWA) will retain the GDPR in UK law, but the government will make appropriate changes ... read more

12-12-2018

VAT on property service charges

A new Revenue and Customs Brief (6-2018) entitled VAT exemption for all domestic service charges has recently been published by HMRC. The brief explains changes to the Extra Statutory Concession (ESC) 3.18 VAT: exemption for all domestic service charges may be applied. The ESC was introduced in February 1994 to enable the same VAT treatment on mandatory service charges to a freehold occupant as to ... read more

12-12-2018

Are you ready for VAT filing changes April 2019?

The introduction of Making Tax Digital (MTD) for VAT is fast approaching. From April 2019, some 1 million businesses with a turnover above the VAT threshold (currently £85,000) will have to keep their records digitally (for VAT purposes only), and provide their VAT return information to HMRC through MTD compatible software. The deadlines for sending VAT returns and making payments are not ... read more

12-12-2018

Is your income approaching £100,000?

For high earning taxpayers, the personal allowance is gradually reduced by £1 for every £2 of adjusted net income that exceeds £100,000 irrespective of age. Adjusted net income is total taxable income before any personal allowances, less certain tax reliefs such as trading losses and certain charitable donations and pension contributions. This means that for the current tax year, an adjusted net ... read more

12-12-2018

Qualifying for VAT special schemes

There are three main special VAT schemes available to small businesses. These are the flat rate scheme, the annual accounting scheme, and the cash accounting scheme. The turnover levels for joining and leaving these schemes vary. The flat rate scheme is open to businesses that expect their annual taxable turnover in the next 12 months to be no more than £150,000, excluding VAT. However, ... read more

12-12-2018

When is lettings relief available?

In general, there is no Capital Gains Tax (CGT) on a property which has been used as the main family residence. This relief from CGT is commonly known as 'private residence relief'. However, where all or part of the home has been rented out, the entitlement to relief may be affected. Home owners that let all or part of their house may not benefit from the full private residence relief but can ... read more

12-12-2018

How the £1,000 trading allowance works

There is a £1,000 tax allowances for miscellaneous trading income that has been available to taxpayers since April 2017. This is known as the trading allowance. The income raised from these kinds of ventures is usually supplemental to a taxpayer’s main income, but this is not always the case. The exemption from tax applies to taxpayers who have trading income of up to £1,000 ... read more

11-12-2018

Citizens’ rights in the event of a no deal Brexit

The government has published a policy paper on what might happen to EU citizens in the UK and UK nationals in the EU, in the event of a “no deal” Brexit. The government has confirmed that those EU citizens and their family members who are resident in the UK by 29 March 2019 will have their rights protected, i.e. they will be able to stay and will continue to be able to work, study and access ... read more

05-12-2018

Could you claim expenses and an early tax refund?

HMRC is reminding employees that they may be able to claim a tax rebate if they have incurred certain expenses related to their employment. HMRC’s press release on the matter specifically identifies workers including nurses, hairdressers, construction workers and those in retail and food that have to dip into their own pockets to pay for work-related expenses like car mileage, replacing or ... read more

05-12-2018

X-factor VAT bonus

The Chancellor, Philip Hammond has announced that the government will waive the VAT equivalent on the sales of this year’s X-Factor Christmas Charity single. All proceeds from the sale of the single are going to two children’s charities; Together for Short Lives and Shooting Star Chase Children’s Hospice. Both charities provide support for children with life-limiting illnesses and their ... read more

05-12-2018

Employing someone to work in your home

When you employ someone to work in your home, it is your responsibility to ensure you 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 you employ anyone they must: have an employment contract be ... read more

05-12-2018

UK VAT claims by non-EU businesses

The VAT paid in other EU countries is often recoverable by VAT-registered businesses in the UK, who bought goods or services for business use. The amount of VAT that is refundable depends on the other countries' rules for claiming input tax. It is important to note that VAT incurred in foreign countries can never by reclaimed on a domestic UK VAT return. There are special rules for businesses ... read more

05-12-2018

HMRC writes to taxpayers in Wales

HRMC has written to two million taxpayers in Wales concerning the introduction of the Welsh rates of Income Tax (WRIT) from 6 April 2019. The WRIT will be payable on the non-savings and non-dividend income of those defined as Welsh taxpayers and WRIT taxpayers will receive a new tax code, starting with C for Cymru. A proportion of the revenue from the Welsh rates of Income Tax will go to the Welsh ... read more

05-12-2018

Taxation of termination payments

In the 2016 Budget, the government announced that termination payments over £30,000 would be subject to employer National Insurance Contributions (NICs) from April 2018. In the 2017 Budget, the government further announced that this change would be delayed for a year with the changes set to come into force from April 2019. A further delay in the implementation of the new rules has now been ... read more

05-12-2018

Who can or cannot claim the 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 employers that have not yet done so can still claim for the current tax year (as ... read more

05-12-2018

When you can utilise overlap relief

The assessment of self-employed or partnerships profits is usually relatively straight-forward if the accounting date, to which accounts are prepared annually, falls between 31 March and 5 April. However, overlap profits can arise where a business year end date is not coterminous with the end of the tax year. Overlap profits can happen in the first 3 years of the business or in any year in which ... read more

03-12-2018

Statutory employee benefit pay to rise from April 2019

In a written ministerial statement, the government has announced the proposed new rates for Statutory Maternity Pay (SMP), Statutory Adoption Pay (SAP), Statutory Paternity Pay (SPP), Statutory Shared Parental Pay (ShPP) and Statutory Sick Pay (SSP) for tax year 2019/20. The proposed revised rates are as follows: The standard weekly rates of SMP, SAP, SPP and ShPP will increase from £145.18 ... read more

29-11-2018

Tax Diary December 2018/January 2019

1 December 2018 - Due date for Corporation Tax due for the year ended 29 February 2018. 19 December 2018 - PAYE and NIC deductions due for month ended 5 December 2018. (If you pay your tax electronically the due date is 22 December 2018) 19 December 2018 - Filing deadline for the CIS300 monthly return for the month ended 5 December 2018. 19 December 2018 - CIS tax deducted for the month ended ... read more

28-11-2018

When to report and pay Capital Gains Tax

The 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 of 20% and this applies to most chargeable gains made by individuals. If ... read more

28-11-2018

Inheritance Tax if you live abroad

The Inheritance Tax rules can be difficult to fathom when an expat or another person with connections to the UK living outside the country dies. The liability to Inheritance Tax in the UK depends primarily on the domicile of the deceased. If the deceased is deemed to be domiciled in the UK for tax purposes, they will generally be subject to Inheritance Tax in the UK regardless of where they died. ... read more

28-11-2018

Claim tax relief for job related expenses

Employees who use their own money to buy things they need for their job can sometimes claim tax relief for the associated costs. It is usually only possible to claim tax relief for the cost of items used solely for their work. There is no tax relief available if your employer pays you back in full for an item you have bought for work. In addition, you cannot claim tax relief if your employer has ... read more

28-11-2018

Coding out debts deadline

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, money is collected in equal monthly ... read more

28-11-2018

Pension automatic enrolment changes

Automatic enrolment for workplace pensions encourages many employees to start making provision for their retirement with employers, and as a bonus, government also contributes to their pension pot. The law states that employers must automatically enrol workers into a workplace pension, if they are aged between 22 and State Pension Age, earn more than the minimum earning threshold (currently ... read more

28-11-2018

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 no Class 1A National Insurance on reimbursed travel expenses where ... read more

28-11-2018

VAT - FRS limited cost trader

The VAT Flat Rate Scheme (FRS) has been designed to simplify a way a business accounts for VAT, and in so doing reduce the administration costs of complying with the VAT legislation. The scheme is open to businesses that expect their annual taxable turnover in the next 12 months to be no more than £150,000. In April 2017, HMRC introduced a 'limited cost trader' test that can increase the VAT flat ... read more

28-11-2018

CGT and investment clubs

Investment clubs are loosely defined as a group of people who get together to buy and sell shares on the stock market with a view to making a profit. An investment club does not have any special legal status and usually operates as a kind of informal partnership. These clubs can offer an interesting perspective to investors helping to hone their skills, share risk and benefit from new fonts of ... read more

28-11-2018

Tax on savings interest

In the current tax year, anyone with taxable income of less than £16,850 will have no tax to pay on interest received. This figure is calculated by adding the £5,000 starting rate limit for savings (where 0% of the interest is taxable) to the current £11,850 personal allowance. However, it is important to note that if your total non-savings income exceeds £16,850 then the starting rate limit for ... read more

22-11-2018

Claim £2,500 broadband voucher

The Gigabit Broadband Voucher Scheme was launched in March this year to help small businesses and local communities connect and gain access to full fibre superfast broadband speeds. The vouchers can be used by small businesses and the local communities surrounding them. The scheme is part of a series of Government initiatives to build nationwide full fibre broadband coverage by 2033. The ... read more

22-11-2018

Options if you are owed money

It can be very difficult for small businesses to know what options are available when their customers owe them money. This can arise when business owners are uncomfortable chasing a debt for fear of upsetting their customer and losing valuable business. The Government has been working to tackle this issue as nearly a quarter of UK businesses report that late payments are a threat to their ... read more

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