News

The latest breaking news in the industry!

17-10-2019

What does the Queen’s Speech mean for employment law?

The Queen’s Speech 2019 outlined several Brexit-related Bills, including an Immigration and Social Security Co-ordination (EU Withdrawal) Bill, designed to end free movement within the UK after Brexit and to lay the foundation for a new, modern and global immigration system. The Bill will also reaffirm the government’s commitment to the right to remain for resident EU citizens ... read more

16-10-2019

New £20 note unveiled

The Governor of the Bank of England, Mark Carney, has unveiled the design of the new £20 note featuring 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 £20 note will include a number of new security features including two windows and a ... read more

16-10-2019

National Living/Minimum Wage entitlement

A reminder that the current National Minimum Wage (NMW) and National Living Wage (NLW) rates came into effect on 1 April 2019. The NLW is the minimum hourly rate that must be paid to those aged 25 or over. The current rate for the NLW is £8.21. The hourly rate of the NMW (for 21-24 year olds) is £7.70. The rates for 18-20 year olds are £6.15 and the rate for workers above the ... read more

16-10-2019

Who is eligible for 10% tax on business sale?

Entrepreneurs' Relief (ER) can be valuable relief when selling your business, your shares in a trading company or your interest in a trading partnership. Where ER is available, Capital Gains Tax (CGT) of 10% is payable. This rate applies to qualifying lifetime gains of up to £10 million. However, it is important to remember that there are qualifying conditions that must be met to ensure ... read more

16-10-2019

Tax if you return to the UK

There used to be a form that had to be completed advising HMRC if you were returning to live in the UK from another country. Whilst this form was abolished some time ago, there are still various actions that you may need to take if you are returning to live and work in the UK. In most cases, if you return to live in the UK you will be classed as resident in the UK and you will be required to pay ... read more

16-10-2019

Provisional date announced for Autumn Budget 2019

The Chancellor of the Exchequer, Sajid Javid, has announced that he is planning to hold his first Autumn Budget 2019 on Wednesday, 6 November 2019. However, this date is based on the UK leaving the EU with a deal on 31 October 2019. At the time of going to press, this was certainly not a foregone conclusion. The Chancellor did confirm that if the UK leaves the EU without a deal then the ... read more

16-10-2019

Gifts in anticipation of marriage

There is a special exemption from Inheritance Tax for cash gifts made on or shortly before the date that the relevant wedding or civil partnership ceremony takes place. The amount of tax relief varies depending on the relationship between the donor and the recipient. Each parent (including step-parents) can gift up to £5,000 tax free Grandparents and Great grandparents can each gift up ... read more

16-10-2019

Definition of a Welsh taxpayer

The start of the 2019-20 tax year marked a fundamental change to the way Income Tax is calculated for people who live in Wales. The new Welsh rates of Income Tax (WRIT) is payable on the non-savings and non-dividend income of those defined as Welsh taxpayers. The definition of a Welsh taxpayer is generally decided on the question of where the taxpayer lives. It should be noted that in order to be ... read more

16-10-2019

Definition of a Scottish taxpayer

The Scottish rate of Income Tax (SRIT) commenced on 6 April 2016 and is administered by HMRC on behalf of the Scottish Government. The SRIT is payable on the non-savings and non-dividend income of those defined as Scottish taxpayers. This means that Scottish taxpayers who also have savings and dividend income, need to consider the UK rates as well as the Scottish rates when calculating their ... read more

16-10-2019

Simplified import procedures

HMRC has automatically registered many businesses to use simplified import procedures should the UK leave the EU without a deal on 31 October 2019. The scheme, called the Transitional Simplified Procedures (TSP) will make importing from the EU bloc much easier, especially for businesses completing customs processes for the first time. The TSP will allow most businesses to transport goods from the ... read more

08-10-2019

Changing your company’s year end

There are special 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 historically set by reference to the date the company was incorporated. Under certain circumstances it is possible to make a change to the year-end. As a general rule, you can only change the ... read more

08-10-2019

What is the Inheritance Tax residence nil rate band?

The Inheritance Tax residence nil-rate band (RNRB) came into effect on 6 April 2017. The RNRB is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death. The RNRB effectively increases your existing £325,000 inheritance tax nil-rate band. The RNRB is being ... read more

08-10-2019

What is Capital Gains Tax incorporation relief?

If you own a business as a sole trader or in 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 chargeable gain based broadly on the difference between the market value of the assets and their ... read more

08-10-2019

Overdrawn directors’ loans

An overdrawn Director’s Loan Account is created when a director (or other close family members) 'borrows' money from their company. Many companies, particularly 'close' private companies, pay the personal expenses of directors using company funds. Where these payments do not form part of a director’s remuneration, they are usually posted to the Director’s Loan ... read more

08-10-2019

When overseas companies need to register at Companies House

An overseas company must register with Companies House if they want to set up a place of business or branch in the UK. Generally, this would be if the overseas company had a physical presence in the UK through which it carries on business. If an overseas company does not have a physical presence in the UK, they are not usually required to register with Companies House. For example, an independent ... read more

08-10-2019

Objecting to a limited company being struck off

There are a limited range of circumstances when a company can request to be removed from the register (known as being struck off). For example, a voluntary strike off can be requested by a dormant or non-trading company. You can object to a limited company’s application to be struck off the companies register if you’re a shareholder or other interested party, such as a creditor, and ... read more

02-10-2019

Post Brexit funding announced

The Chancellor is set to announce a new package of measures to help the UK prepare for a post-Brexit future. We are told that these measures will also help to support the next generation and promote economic growth. It has also been confirmed that British organisations that are receiving certain EU funding, will continue to do so even after a no-deal Brexit. If the EU cease to fund UK ... read more

02-10-2019

Residential landlords’ tax changes complete April 2020

The tax relief on finance costs used to buy investment properties is being gradually restricted to the basic rate of tax. The full finance costs restriction will be in place from 6 April 2020. This means that from next April, all finance costs will be disallowed as expenses and any relief will be restricted to a basic rate tax credit. Finance costs include interest on: mortgages, loans - ... read more

02-10-2019

Making a loss when you sell your home?

One of the most often used and valuable of the Capital Gains Tax (CGT) exemptions is Private Residence Relief, which usually exempts any profit made on the sale of a family home. Consequently, there is no CGT on a property disposal that has been used solely as the main family residence. An investment property, which has never been used as a family residence, will not qualify for PRR. However, an ... read more

02-10-2019

Changes to off-payroll working from April 2020

The rules for individuals providing services to the public sector via an intermediary such as a Personal Service Company (PSC), changed from April 2017. The new rules shifted the responsibility for deciding whether the intermediaries’ legislation applies, known as IR35, from the intermediary to the public sector receiving the service. In the 2017 Autumn Budget, the Government announced ... read more

02-10-2019

Gifts to spouse or charity

There is usually no Capital Gains Tax (CGT) to be paid on the transfer of assets to a spouse or civil partner. There is, however, still a 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 or loss will be calculated from when the asset was first owned by the original spouse or civil ... read more

02-10-2019

When NIC 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 the amount of qualifying years of National Insurance contributions, which can increase the amount of benefits a person is entitled to, such as the State Pension. National Insurance credits are available in certain situations when people are not working and, ... read more

25-09-2019

NIC after State Pension Age

If you have reached the State Pension age and continue to work in most cases, you no longer need to pay National Insurance Contributions (NICs). At State Pension age, the requirement to pay Class 1 and Class 2 NICs ceases. However, you will remain liable to pay any NICs due to be paid to you before reaching the State Pension age. If you continue working, you need to provide your employer with ... read more

25-09-2019

To-do list if selling your business

If you are selling your business, there are some important actions you must take in order to properly finalise your affairs. We have summarised below some of the main steps you need to take if closing your business. Please note that this is not an exhaustive list and it is important to check what else may be required. Self-employed sole trader Notify any staff about when and why you are ... read more

25-09-2019

Tax for provision of parking spaces

There are some important rules to be aware of if you provide parking spaces to your employees. If the parking places 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 would not be required to pay any additional tax or National Insurance for these parking spaces. These rules ... read more

25-09-2019

Brexit and making an EU VAT refund claim

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 exact rules that govern what VAT 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. Claims must be made ... read more

25-09-2019

Brexit and VAT Mini One Stop Shop

HMRC has confirmed that after Brexit, you will not be able to use the UK’s VAT Mini One Stop Shop (MOSS) to declare and pay VAT. The final return period for the UK’s VAT MOSS system will be the period ending 31 December 2019. However, on this final return you should only include sales made before Brexit. HMRC has confirmed that after Brexit, you will be able to use the UK’s VAT ... read more

25-09-2019

Basis periods – the general rules

A basis period is the time period for which the self-employed or partnerships pay tax in each tax year. The general rule is that the profits for a tax year are those arising in the period of 12 months ending with the accounting date in that year. The use of basis periods ensure that taxable profits are allocated to the correct accounting period. The general rule will always apply to a continuing ... read more

25-09-2019

Setting off trading losses against other income

Where an individual makes a loss in a trade or incurs a loss as a partner in a partnership trade, the tax rules allow the loss to be set against general income. Certain trade losses may be offset against general income. It may also be possible to carry trade losses back to earlier years or forward to subsequent years. However, partial claims are not allowed. This means that a loss set against ... read more

25-09-2019

Patents, general considerations

A UK patent is granted under the laws of the UK, usually, by the UK Intellectual Property Office. Obtaining a patent can be a difficult and expensive endeavour. A patent only protects an invention in the country where the patent is registered, and so multiple patents may be required across different jurisdictions. To be granted a patent, an invention must be all of the following: something ... read more

24-09-2019

Tax Diary October/November 2019

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

18-09-2019

Shared parental leave and pay

The shared parental leave and pay rules offer working parents far greater choice as to how they share the care of their child and take time off work during the first year of their child’s life. The rules apply equally for children that have been adopted. There are various work and pay criteria that must be met in order to be eligible and the parents must share responsibility for the ... read more

18-09-2019

Reporting changes that affect Child Benefits

You must notify HMRC of certain changes to family life. For example, a change in your child’s or your family’s circumstances. This is to ensure that the correct amount of Child Benefit is paid in respect of your children. You must tell HMRC if your child: starts paid work for 24 hours a week or more will live away from you for either 8 weeks in a row or more than 56 days in a ... read more

18-09-2019

Tax relief for private pension contributions

You can claim tax relief for your private pension contributions. The annual allowance for tax relief on pensions 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 limit for tax relief on pension contributions. The ... read more

18-09-2019

Don’t miss your company accounts filing deadline

Companies House has issued a press release to remind companies to keep on top of their filing responsibilities. The end of this month, 30 September 2019, marks a common deadline for many companies who will need to file their company accounts with a 31 December 2018 year-end date. Last year, a total of 25,049 companies failed to meet the 30 September 2018, filing deadline. In fact, we are told ... read more

18-09-2019

IHT and lifetime transfers

There are special rules concerning the liability to IHT of a transfer made during a person's lifetime. For example, 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'. The gifts or transfers achieve their potential of becoming exempt from IHT if the taxpayer ... read more

18-09-2019

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 as income of a trade and not as property income. There ... read more

18-09-2019

VAT Agricultural Flat Rate Scheme

Businesses that use the flat rate scheme pay VAT as a fixed percentage of their VAT inclusive turnover. The VAT agricultural flat rate scheme is a variant of the flat rate scheme specifically designed for farmers and other activities relating to agricultural production (such as horticulture). Farmers cannot join this scheme if the value of their non-farming activities is above the VAT ... read more

18-09-2019

Loan charge review launched

The Treasury has announced that Sir Amyas Morse, the former Comptroller and Auditor General and Chief Executive of the National Audit Office (NAO), will lead an independent review of the loan charge. This announcement gives some hope to many people affected by the contentious loan charge. This review will consider concerns raised by MPs and campaigners lobbying for the withdrawal of the loan ... read more

18-09-2019

Paper Self-Assessment return deadline

The 2018-19 tax return deadline for taxpayers who continue to submit paper Self-Assessment returns is 31 October 2019. 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 2020. We would recommend that anyone still submitting paper tax returns ... read more

12-09-2019

New checker tool to help businesses prepare for Brexit

The Government has launched a “Get ready for Brexit” public information campaign to help ensure businesses are ready when the UK leaves the EU on (currently) 31 October 2019. As part of the campaign, a new checker tool will help businesses to prepare for Brexit, particularly if they import or export, deal with personal data or employ EU nationals. Users can use the tool to identify ... read more

12-09-2019

Immigration rights of EEA citizens in the event of a no-deal Brexit

The Government has now announced the revised transitional arrangements that will apply in the event of a no-deal Brexit to EU, EEA and Swiss citizens and their close family members arriving in the UK after Brexit, replacing those set out in a January 2019 policy paper issued under the previous Prime Minister, Theresa May. The Government’s new policy paper means that law-abiding EU, EEA and ... read more

11-09-2019

Get information about a company

There is a significant amount of information that can be obtained from Companies House. Companies House is responsible for incorporating and dissolving limited companies, examining and storing company information and making company information available to the public. Much of the company information available can be accessed free of charge. This is in line with the Government’s commitment ... read more

11-09-2019

What is the Annual Investment Allowance?

The Annual Investment Allowance (AIA) is a generous tax relief that was first 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 trade, profession or vocation, a UK ... read more

11-09-2019

Planning a Christmas party?

Now is the time that many businesses are planning a Christmas celebration for staff as well as possibly for partners/spouses, 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 various criteria outlined below, then there is no requirement to report anything to HMRC or pay tax and National ... read more

11-09-2019

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 pay your employees. The information provided on an FPS helps HMRC ensure that they have the ... read more

11-09-2019

Options to close down a limited company

There are a number of reasons why a limited company may no longer be required and can be shut down. This may be because the limited company structure no longer suits a client's needs, the business is no longer active, or the company is insolvent. You will usually need the agreement of all the company’s directors and shareholders to close down the company. The method for closing down a ... read more

11-09-2019

Claiming Entrepreneurs’ relief

Entrepreneurs' relief applies to the sale of a business, shares in a trading company or an individual’s interest in a trading partnership. Where this relief is available, CGT of 10% is payable in place of the standard rate. There are a number of qualifying conditions that must be met in order to qualify for the relief. When the relief was first introduced there was a lifetime limit of ... read more

11-09-2019

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 UK. According to HM Treasury, the decision to reintroduce duty-free ... read more

11-09-2019

ICO publishes no-deal Brexit guidance for SMEs

The Information Commissioner’s Office (ICO) has published dedicated guidance to assist small and medium-sized businesses in their preparations for a no-deal Brexit and has urged them to “prepare for all scenarios” to maintain data flows when the UK leaves the EU. The guidance for small and medium-sized businesses is not entirely new as the ICO has, in fact, tailored its ... read more

10-09-2019

VAT changes for CIS Sub-contractors delayed

The VAT rule changes for building contractors and sub-contractors that were expected to come into effect imminently, have been delayed for 12 months until 1 October 2020. This surprise 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 rules was also ... read more

04-09-2019

Filing deadlines for company accounts

The normal deadline for filing private limited company accounts is 9 months after the company’s financial year end, known as the accounting reference date. For example, many companies have a year-end date of 31 March and are therefore required to file their accounts by 31 December. For public companies, the time limit is 6 months from the year end. The deadline for filing your first set of ... read more

04-09-2019

Filing deadlines for a company confirmation statement

As well as filing accounts with Companies House, there is a further requirement to check that the information Companies House holds 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 annual return form. A confirmation statement must usually be filed at ... read more

04-09-2019

Help to Save accounts

The Help to Save scheme can help those on low incomes to boost their savings. The scheme was launched in September 2018, and new figures published by HMRC have revealed that over 132,000 people have signed up, depositing more than £31.4 million into Help to Save accounts. These savers are now eligible for bonuses totalling around £14 million. Under the scheme, those receiving Working ... read more

04-09-2019

State Pension update for recipients living in the EU

If you live or move abroad, you are entitled to claim the State Pension if you have met the necessary qualifying criteria. This is based on your UK National Insurance record. You require a minimum of 10 years of UK National Insurance contributions to be eligible for the new State Pension. The New State Pension can be claimed if you reached your State Pension age on or after 6 April 2016. If you ... read more

04-09-2019

Merchandise in Baggage in case of no-deal Brexit

There are special customs requirements for commercial goods or samples which are imported or exported by passengers in their accompanied baggage (hand carried) or in a small motor vehicle (carrying less than 9 passengers and weight 3.5 tonnes or less). This is known as Merchandise In Baggage or MIB. MIB goods include the following: goods for commercial sale spare parts trade ... read more

04-09-2019

Simplified expenses 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 instead of working out the actual costs of ... read more

04-09-2019

Simplified expenses use of home

If a taxpayer is self-employed and running a business from home, there are simplified expense rules available for claiming a fixed rate deduction for certain expenses where there is a mix of business and private use. The simplified expenses rules are not available to limited companies or business partnerships involving a limited company. The use of the flat rate expenses for core business ... read more

04-09-2019

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, which also falls to be treated as ... read more

04-09-2019

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

29-08-2019

Government to end free movement if a no-deal Brexit

If the UK leaves the EU without a deal in place on 31 October 2019, EU, EEA and Swiss citizens (and their family members) who are living in the UK by this date will still be eligible to apply for settled or pre-settled status under the EU Settlement Scheme and they will have until 31 December 2020 to do so. Under Theresa May’s Government, in the event of a no-deal Brexit, temporary ... read more

28-08-2019

Do you trade with EU companies?

The new Chancellor, Sajid Javid, has stepped up plans to help ensure businesses are ready to trade post-Brexit if the UK leaves the EU without a deal. If you trade goods with the EU then you will be responsible for making customs declarations, as is the case for businesses currently exporting goods outside the EU. To do this, you must have a UK Economic Operator Registration and Identification ... read more

28-08-2019

How dividends are taxed

The dividend tax allowance was introduced in April 2016. It replaced the old dividend tax credit with an annual £5,000 dividend allowance with tax payable on dividends received over this amount. The tax-free dividend allowance was reduced to £2,000 with effect from 6 April 2018. The tax rate for dividends received in excess of the dividend tax allowance are taxed at: 7.5% for basic ... read more

28-08-2019

Deregistering for VAT

A compulsory VAT deregistration is usually required if you: Stop making taxable supplies Sell your business Change legal status Disband a VAT group Join a VAT group Join the agricultural flat rate scheme A voluntary VAT deregistration can be made if you do not expect your taxable turnover to exceed the VAT deregistration limit. The current deregistration limit is £83,000. You ... read more

28-08-2019

VAT changes for CIS Sub-contractors

Important changes to the VAT rules for building contractors and sub-contractors are coming into effect from 1 October 2019. In a nut-shell, if you are subject to the Construction Industry Scheme (CIS) and if you are registered for VAT, from the 1 October 2019 you may need to change the way you account for VAT on supplies between sub-contractors and their contractor customers. At present, ... read more

28-08-2019

Blind Person’s Allowance

The Blind Person’s Allowance is an extra amount of tax-free allowance made available to those who are eligible. The allowance for the current 2019-20 tax year is £2,450. If both spouses / civil partners are eligible, they will both get an allowance. An eligible claimant can transfer their allowance to their spouse or civil partner if they do not pay tax or cannot use all of the ... read more

28-08-2019

New CGT rules for homeowners

Currently, if a property has been occupied at any time as an individual’s main private residence, the last 18 months of ownership are disregarded for CGT purposes. This relief applies even if the individual was not living in the property when it was sold. From April 2020, this final exempt period will be reduced from 18 months to 9 months. There will be no change to the 36 months exempt ... read more

28-08-2019

The importance of a written contract

The importance of having a written contract when deciding employment status should not be understated. Failing to make proper provision for written contracts can mean relying on oral agreements, which are obviously much harder to prove. Having a written contract can provide certainty to both parties and help avoid disputes or at the very least make it easier to handle any disputes that ... read more

28-08-2019

A reminder of the 'badges of trade'

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 merely a money-making side-line to a hobby. Careful consideration needs to be given to deciding whether a hobby has become a taxable activity. Both HMRC and the courts are clear that it is important to look at the whole picture rather than ... read more

27-08-2019

Tax Diary September/October 2019

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

20-08-2019

National Insurance if you work abroad

If you move abroad, it can often be advantageous to continue paying your UK National Insurance Contributions (NICs) in order to preserve your entitlement to the UK State Pension and other benefits. If you are working in the European Economic Area (EEA), the rules depend on your situation (see below). The EEA includes all EU countries as well as Iceland, Liechtenstein and Norway. The same rules ... read more

20-08-2019

Tax if you work abroad

If you are leaving the UK to work abroad for at least one year (or permanently), there is a requirement to notify HMRC. This is done using a P85 form which should be completed and submitted to HMRC. You will also be required to submit a Self-Assessment tax return if you usually complete one, for example, if you are self-employed. The completion of the P85 form will also ensure you can claim any ... read more

20-08-2019

When can you increase your rental income?

The ability to increase the rent on private rentals is driven by the tenancy agreement. This is an agreement between the landlord and the tenant. The agreement can be written down or oral. The tenancy can either be: fixed-term (running for a set period of time) periodic (running on a week-by-week or month-by-month basis) The type of tenancy agreement dictates when you can consider ... read more

20-08-2019

PAYE late filing 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 or ... read more

20-08-2019

When are scholarships taxable as benefits?

The holder of a scholarship is exempt from a charge to Income Tax on income from a scholarship when receiving full-time education at a university, college, school or other educational establishment. Please note, that the provision of a scholarship to a member of the family or household (usually a son or daughter) of a director or employee by reason of the employment of that director or employee, ... read more

20-08-2019

Taxation of miscellaneous income

There are special rules, known as the miscellaneous income sweep-up provisions, that seek to charge tax on certain income. This unusual provision, which is broad in scope, catches certain income that would not otherwise be charged under specific provisions to Income Tax or Corporation Tax. Amongst the types of income covered are: payment for a service where it was agreed that the service would ... read more

20-08-2019

The meaning of goodwill

Goodwill is a term we hear about often, but interestingly, is rarely mentioned in legislation. In fact, the term 'goodwill' is not defined for the purposes of the Capital Gains legislation in TCGA 1992. Most definitions of goodwill are derived from case law. You could describe goodwill as the 'extra' value attributed to a business over and above a valuation of its tangible ... read more

14-08-2019

What you can do with your pension pot

Pension Wise is a free government service that was launched in 2015 to help provide individuals with general pension advice. However, the service does not answer specific questions relating to your pension. The main advice the service provides is generic and covers what you can do with your pension pot, the different pension types, how they work and what’s tax-free and what’s not. The ... read more

14-08-2019

When you can claim back VAT on purchase of a car

There are complex VAT rules that determine the amount of VAT that can be recovered when purchasing a new car. The usual rule is that when you purchase a car for your business then no VAT can be reclaimed. The main exception to this rule is when the new car is used solely for business use. This rule has been the subject of much case law over the years, but it has generally been established that to ... read more

14-08-2019

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 have an income that 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 reducing or removing the benefit entirely. If you or ... read more

14-08-2019

VAT and insurance claims

Insurance transactions are generally VAT exempt. However, there are many issues that can arise concerning the VAT liability of certain insurance transactions. One of these issues concerns the VAT treatment of insurance claims. Insurers are unable to recover VAT incurred in obtaining replacement goods or having repairs carried out for a policy holder. This supply is treated as being made to the ... read more

14-08-2019

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 of the family or households of the above. Where a benefit is ... read more

14-08-2019

How do you calculate adjusted net income?

To calculate adjusted net income, you will need to look at a taxpayer’s total taxable income, before personal allowances, and then deduct any trading losses, gift aid donations, gross pension contributions and pension contributions where the pension provider has already provided tax relief at the basic rate. Calculating the adjusted net income amount is necessary if any of the following ... read more

08-08-2019

Pregnant women and new parents to get enhanced redundancy protections

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 are absent on maternity, adoption or shared ... read more

07-08-2019

Lowest paid to be eligible for sick pay

A new consultation launched jointly by the Department for Work and Pensions and the Department of Health and Social Care, is seeking views on different ways in which both the Government and employers can take action to reduce ill health-related job loss. The consultation is examining a number of specific proposals including: Reforming Statutory Sick Pay (SSP) so that it is better enforced, ... read more

07-08-2019

Visiting EU after 31 October 2019

Although we have a new Prime Minister, it would seem that so far nothing has changed to bring us any closer to a Brexit resolution. In fact, it appears that a no-deal Brexit is becoming more likely as we approach the 31 October deadline. 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 ... read more

07-08-2019

Last chance to join the Help to Buy ISA scheme

The Help to Buy ISA scheme will close to new savers after 30 November 2019. This leaves less than 4 months to open an account before the product is due to be withdrawn by the Government. Once opened, account holders can continue to save in their ISA account until 30 November 2029 when accounts will close to additional contributions. Bonuses can be claimed until 1 December 2030. The scheme allows ... read more

07-08-2019

Clients exporting to EU if a no-deal Brexit

If the UK leaves the EU without a deal, any UK business that exports goods to the EU will be responsible for making customs declarations (as is the case for businesses currently exporting goods outside the EU). If you have clients that trade with the EU, you should check that they have a UK Economic Operator Registration and Identification (EORI) number. If they have not applied, it is important ... read more

07-08-2019

Working after State Pension age

There are many taxpayers that have reached 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 any NICs that were due to be paid on earnings before they reached the ... read more

07-08-2019

Inheritance Tax and domicile

Domicile is a general legal concept which in basic terms is taken to mean the country where you permanently belong. However, determining domicile status can be complex. HMRC guidance states that domicile cannot be defined precisely, but the concept rests on various basic principles. Although domicile can change, there is generally a presumption in favour of the continuation of an existing ... read more

30-07-2019

Duty free limits if you are travelling abroad

Here is a reminder for our readers of their duty and tax free allowances if travelling abroad this summer. Travelling to an EU country Where tobacco or alcohol is brought in from another EU country, no duties or tax will be payable as long as you can demonstrate that the goods are for your own use, and that you paid the relevant taxes and duties on the purchase. However, HMRC provide the ... read more

30-07-2019

Payments on account system glitch

The due date for making your second payment on account for 2018-19, was the 31 July 2019. The amount that was due for payment is usually the same as that for your first payment on account made on or before 31 January 2019. If you are late making a payment on account, you will likely be required to pay interest and penalties. Issues with HMRC’s handling of payments on account have been ... read more

30-07-2019

VAT for business if there’s a no-deal exit from the EU

With the new Prime Minister, Boris Johnson, appearing to take an increasingly hard line the chances of Britain leaving the EU without any working agreement, known as a 'no deal' Brexit, are looking increasing likely and certainly cannot be ignored. If the UK leaves the EU on 31 October 2019, without a deal, there would be immediate changes to the procedures that apply to businesses ... read more

30-07-2019

Keeping records if 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 from the 31 January submission deadline for the relevant tax year. For example, for the 2017-18 tax year where online filing was due by 31 ... read more

30-07-2019

How to claim a personal tax refund

HMRC’s annual reconciliation of PAYE for the tax year 2018-19 is well under way. HMRC use salary and pension information to calculate if you have paid the correct amount of tax. The calculation is usually generated automatically by HMRC’s computer systems on what is known as a P800 form. If you are due a tax refund for 2018-19, you should receive a P800 by the end of September. If you ... read more

30-07-2019

VAT accounting after prices are changed

New rules that make changes to the issuing of credit notes under certain circumstances, will come into effect from 1 September 2019. The changes have been put in place to target certain businesses who seek to create a tax advantage, by making VAT adjustments for reductions in price without refunding their customers. The change will ensure that customers benefit from reductions in the price paid ... read more

30-07-2019

Changes to Structures and Buildings Allowance

The new Structures and Buildings Allowance (SBA), allows for tax relief on qualifying capital expenditure on new non-residential structures and buildings. The relief applies to the qualifying costs of building and renovating commercial structures. The relief was introduced with effect from 29 October 2018 and applies where all contracts for the physical construction works are entered into on or ... read more

30-07-2019

Earlier payment dates for Capital Gains Tax

Currently, the due date for paying any Capital Gains Tax (CGT) owed to HMRC is the 31 January, following the end of the tax year in which a Capital Gain was made. This deadline will change for UK residents from April 2020. Clients should be advised that this change will mean that any CGT due on the sale of a residential property will need to be reported earlier than is current the case. In ... read more

30-07-2019

Changes at HM Treasury

Within hours of entering 10 Downing Street for the first time as Prime Minister, Boris Johnson had filled most of the senior cabinet roles by undertaking a major overhaul of cabinet members. After three years in the job, the previous Chancellor of the Exchequer, Philip Hammond resigned his position to the outgoing Prime Minister, Theresa May, rather than face the sack. He has been replaced in the ... read more

25-07-2019

The Pensions Regulator launches new re-enrolment tool

Every three years, employers must put certain eligible workers who have left their automatic enrolment workplace pension scheme back into it. This is called re-enrolment. Employers must also complete and submit a re-declaration of compliance to tell The Pensions Regulator (TPR) how they have met their re-enrolment duties, even if they do not have any workers to re-enrol. This re-declaration ... read more

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