The Department for Work and Pensions (DWP) is making slow progress on addressing State Pension errors for around 194,000 parents who are being denied a full State Pension because they have not had the correct information applied to their National Insurance records. The problem relates to the Home Responsibilities Protection (HRP) which is an allowance…
Keeping good business records is an essential part of running a business, but it is also a legal requirement when it comes to HMRC. To keep on the right side of the law, businesses and individuals should keep records of their income and expenditure for at least six years. If HMRC decides to undertake an…
The new Labour Government will be adding VAT to school fees from January 1 next year, which will increase the bill to parents by 20%, unless schools choose to reduce fees another way to reduce the impact of the extra tax. Private schools have been exempt from VAT on fees for more than 50 years,…
Anyone who needs to make changes to their VAT details now needs to do this online through their VAT online account. Prior to August 5, you could use the VAT484 form, or another postal or electronic method. But this is being phased out. The digital route is more secure and prevents delays in making the…
Inheritance Tax (IHT) has reached a record level in the UK, with £7.5 billion flowing into Treasury coffers in 2023/24, up from £7.1 billion the previous tax year. One key reason for this growing tax take is rising property prices – the average house price in the UK has reached £288,949 according to Halifax –…
Stamp Duty Land Tax (SDLT) is the bane of property buyers in the UK. It is paid on every property purchase worth more than £250,000, and more people are being forced to pay it each year as the thresholds stay the same while property prices rise. The number of transactions under this lowest threshold has…
No-one likes to pay more to the taxman than they have to, but if you fall foul of HMRC’s rules, you could find yourself paying a penalty, and interest if things are not sorted out quickly. There are various fines you could face from HMRC if you get things wrong, and here we go through…
An app from HMRC which provides information such as your National Insurance number and tax information has been flagged by the taxman to help students completing their A’ Levels this year and planning to head to university in September. Anyone who is applying for student finance – for Fee Loans, Maintenance Loans or Maintenance Grants…
Thousands of people in the UK who are paid weekly could find themselves making extra tax payments this year if they are paid on a Thursday or Friday. Employees paid on Thursday 4April or Friday 5 April may need to pay extra tax as they would have received 53 payments in the 2024/25 tax year…
Whenever you leave a tip in a restaurant or a hairdressing salon, for example, you would hope that the tip money you left will go directly to the person who provided you the service you are tipping for. But for many restaurants and other industries, that hasn’t always been the case. So now, the Government…
HMRC will provide new tax codes at the start of every new tax year if the Personal Allowance has changed, if someone has had a change of circumstances, including perhaps had a pay rise, and even to those who are taking their pensions for the first time. It’s important to check that your tax code…
Around 650,000 pensioners are facing the prospect of paying tax on their pensions for the first time from this month thanks to a big boost to the State Pension from April 6, and frozen tax bands that will drag them into the tax net, according to calculations from Lane, Clark and Peacock (LCP). The 8.5%…
The Chancellor, Jeremy Hunt, delivered his Budget statement to Parliament on March 6, and there were various changes that should benefit individual taxpayers and businesses. One of the biggest announcements, which takes effect from April 6, is a further reduction in the rate of National Insurance Contributions (NICs). From this date, Class 1 employee NICs…
The tax regime for Furnished Holiday Lettings (FHLs) is set to be abolished from April 6, 2025, with some key tax breaks being removed by the Chancellor in the Spring Budget on March 6 in a move which could raise as much as £300m extra in tax each year. The changes will make it much…
If you hold or invest in cryptocurrency, or even if your employer pays you in a cryptocurrency such as Bitcoin, you may need to declare this on your self-assessment form. For anyone who didn’t in the 2022/23 form which should have been filed before January 31, it would be wise to get advice quickly on…
The P11D form which has been used to process ‘benefits-in-kind’ such as loans for season tickets and company cars will no longer be used after April 2026, as HMRC will ask businesses to deal with all these benefits through the payroll instead. HMRC announced earlier this year that the regime for dealing with the taxation…
Now is the time to start thinking about your end-of-year tax planning while there is still time to maximise the benefit of any allowances you haven’t used yet this tax year. The end of the current tax year is April 5, 2024, and there are various tax breaks you want to make the most of…
Many of us will die without a will because it is something that we fail to get around to, often because we don’t want to think about our own demise. Around half of UK adults don’t have a will, with a third of those over 55 in this position, according to research from Canada Life.…
Any trader making export declarations needs to move to a new HMRC system from March 30 this year. The CHIEF system is being fully replaced by the Customs Declaration System, and anyone who has been using the old system will now have to move across. There has been a transition period from the old to…
Small businesses looking to access funding to expand their exporting opportunities can now fast-track their applications with UK Export Finance, the Government’s export credit agency, and apply for twice the previous amount. The limit available now is £10m. The move makes it “easier than ever” to sell into international markets, according to the Government, as…
Rumours have been circulating online that HMRC is set to crack down on tax avoidance on sales of goods on the likes of eBay and Etsy, but the basic rules haven’t changed, and anyone who was trading on one of these sites should always have been declaring their earnings to the taxman. What has changed…
Interest rates went up significantly in the last year, to the current Bank of England base rate of 5.25%, but in a change that is welcome for those looking to buy a house or remortgage, some lenders have begun a price war. Halifax and HSBC were two of the first lenders to start bringing their…
More people file for divorce in January than any other month of the year, probably because the stress of being together for an extended period over Christmas and New Year brings any cracks in a relationship bubbling to the surface. Or it could be that people want to start the New Year afresh and were…
For the first time in the 47 years since Child Benefit was launched, new parents can claim their Child Benefit online in a significantly faster way than the previous process allowed, according to HMRC. The previous method – which had been in place since 1977 – was to fill in a paper form which had…
The festivities are over, all the food has been eaten, presents exchanged, and you will probably have already taken your Christmas decorations down. But for many people, the lasting legacy of Christmas isn’t just a few extra pounds around the midriff, but a lot of extra pounds in debt. If you are one of the…
The start of the year is always the time when anyone who needs to file a self-assessment return should get their skates on if they haven’t filed yet. The deadline for filing your self-assessment is January 31, and anyone not hitting the target could be setting themselves up for a fine and possible interest payments…
HMRC is encouraging those who are either married or in a civil partnership to check whether they could be up to £252 a year better off by claiming Marriage Allowance. It has launched a Marriage Allowance Calculator to help those who are unsure double check what they might be due. Couples could be eligible where…
Just a quick reminder that the reduction of Class 1 National Insurance Contributions (NICs) will begin on January 6, 2024. From this date, the amount paid on Class 1 NICs will fall from 12% to 10%. This is the main rate of NICs paid by employees through PAYE. The change was part of a range…
Chancellor Jeremy Hunt announced several tax breaks for individuals and businesses in this year’s Autumn Statement ahead of the General Election next year. While they will help to put a little more money back into our pockets, other decisions made over many years on areas such as the freezing of tax thresholds make them less…
The biggest tax cuts announced by the Chancellor in his Autumn Statement were in NICs, where self-employed people will no longer pay Class 2 NICs at all from April 6, 2024. Class 4 NICs will be reduced from 9% to 8% from the same date. Class 1 employee NICs – which apply to employees working…
Pensions are set to have one of the biggest overhauls in recent memory, as the Chancellor also announced a consultation on plans that would bring significant changes to pensions in the UK. The biggest change would be a Lifetime Pension, more colloquially known as a ‘pot for life’ – where someone would choose the pension…
Yes, it’s that time of year again! Christmas is on the horizon, and the office Christmas party planning will be in full swing for many companies across the UK. So, if you are planning a shindig for your employees, you should maximise the tax breaks available from HMRC, and make sure you don’t fall foul…
The cost-of-living crisis is hitting many of us hard, no matter how well off we might be. But there are many people who have money sitting in lost bank or building society accounts, pensions or investments who could reclaim it to help them meet their financial demands. In fact, Gretel, one of the services that…
Thousands of people found themselves caught up in the IR35 tax avoidance problems, where freelancers who were earning through a limited company set up to deal with their income were deemed – retrospectively – by HMRC to have been involved in tax avoidance. In short, if most of or all their income came from a…
Group income protection policies taken out through employer salary sacrifice schemes have been wrongly treated for tax thanks to incorrect advice given by HMRC to the Association of British Insurers back in October 2019. Even though HMRC corrected this advice in August last year, there could be a number of people who haven’t paid enough…
Importers of goods to the UK from overseas no longer need a business tax account to get an Advance Valuation Ruling for their goods. The rulings, which last for up to three years, mean traders and agents can act with legal certainty on the value of the goods they are importing for customs calculations. By…
For most people the summer holidays will be firmly in the rearview mirror by now and they will be starting to focus on the year ahead. One way to make sure next year will be one to remember is by putting some effort into business development now, so you can start 2024 in good shape.…
The latest official figures show that redundancies are on the rise this year. Expected redundancies are up from 22,525 in June to 23,975 in July, based on the number of HR1 forms filed to HMRC. While this data lags behind real-world figures because of the way it is collated, many big companies have already announced…
Anyone who has become self-employed, was in a business partnership, earned more than £100,000 or had to pay the High-Income Benefit Charge this year has until October 5 to speak to HMRC to register for self-assessment. Millions of people each year need to do a self-assessment, and this includes anyone earning money outside of their…
A new UK Internal Market Scheme (UKIMS) has been launched to replace the old UK Trader Scheme, which will enable any registered traders to move ‘not at risk’ of entering the EU goods into Northern Ireland. The legislation, which came into force on September 30, is needed following the UK’s exit from the European Union.…
People making the most of flexible pension withdrawals have been facing tax overpayments due to miscalculations by HMRC. In Q2 2023 alone, the taxman repaid £56,243,842 to people who had been taxed more that they should on their pension withdrawals. This amounts to an average of £3,551 per person. The figure is up nearly £8m…
Up to 38,000 pubs and bars which have seen cuts in the tax they pay on the draught products they serve will be better off thanks to changes to the way that Alcohol Duty is calculated from August 1, 2023. The cuts will make pints and other products sold on tap 11p cheaper than supermarket…
The ability to legally assign an income tax repayment, or the right to an income tax repayment, to a third party has been removed by HMRC from March 15 this year, meaning any repayment will remain the legal property of the taxpayer in question. The change affects those who may have used a business, an…
Any regulated businesses that need to sign up for the Economic Crime (Anti-Money Laundering) Levy (ECL) can now both register and make returns via the online service. Registrations and returns cannot be made by tax agents, so every affected business must sign up and make their returns directly. To file a return online, businesses must…
The Bank of England (BoE) has raised rates 13 times in a row to June this year, with the base rate reaching 5% – a level not seen since 2008 at the height of the financial crisis. Mortgage rates and loan rates have risen alongside the base rate, but savings rates have tended to lag…
Charitable giving is something many organisations might not be considering in the current climate, especially as everyone is struggling to pay their bills. But if you have money to spare within your business, then charitable giving is a great way to reduce your tax bill on company profits while simultaneously helping a good cause. The…
We all love a perk of the job, and a major industry has built up around the types of employee perks companies are able to offer. The best news of all is that most of these will be tax deductible, which means the taxman will fund at least part of them. Everything from free snacks…
When your business was registered at Companies House, you would have provided lots of detail about the business and the people who run it – including who are your directors, company secretary, the breakdown of share capital, and the type of business your company does. But failing to keep this information up-to-date could land you…
HMRC is changing the way sole traders and partnerships need to calculate profits for their self-assessment returns. The Revenue will require the profits to be declared for the tax year in question, rather than the accounting year as is currently the case. Any sole traders or partnerships with an accounting year ending at any point…
The threshold for people taxed through PAYE who are required to file a self-assessment return has increased from £100,000 to £150,000. Those affected should be contacted by HMRC if they need to change anything. That said, there have been times in the past where HMRC hasn’t always been spot on with its own paperwork, so…
P11D and P11D(b) forms from April 6, 2023, now need to be filed online by July 6 following a rule change from HMRC. If employers need to make amendments to any returns that have already been filed, these should also be made online through a new form via the expenses and benefits for employers page. If…
Do you struggle to remember – or find – your National Insurance number when you’re asked for it? If so, you’re not alone. So, it will be a relief to many that HMRC has now created a way for iPhones to store someone’s National Insurance number in their Apple Wallet either online or through the…
The cost-of-living crisis is taking its toll across all areas of our lives now. While inflation has fallen very slightly this month to 8.7%, food prices remain stubbornly high, and the Bank of England (BoE) is expected to continue with its base rate rises until later this year. The last rate rise in early May…
The pandemic brought a lot of changes to our businesses, some good and some bad. One that has continued to be a topic of conversation is the desire for more people to be able to work some, or all, of the time from home. If your business requires people to be onsite – such as…
Anyone with an incomplete National Insurance contributions (NICs) record between April 2006 and April 2016 now has until July 31 to add to their NICs to qualify for a full State Pension after HMRC extended the deadline. Thousands of taxpayers have incomplete years in their NICs record who could get a higher State Pension if…
Salary sacrifice is something you may have come across before but not fully understood. After all, why would anyone want to voluntarily give up some of their salary? The reality is that, in some instances, using salary sacrifice to get alternative benefits can reduce your tax bill considerably and make buying the things you would…
The new tax year started on April 6 and while many people will wait until the last minute to maximise the tax benefits available to them, there is a lot to be said for starting your tax housekeeping sooner rather than later. There are many ways we can benefit from the tax breaks available each…
The Chancellor made some major changes to the pension rules in the March Budget, and one key amendment has made using something called ‘Carry Forward’ rules much more beneficial for pension savers. How does Carry Forward work? The Carry Forward rules allow you to use up any unused pension allowance from the last three tax…
Our cars go through MOTs each year once they reach a certain age, but have you ever thought of giving yourself an MOT? The Government is offering a free midlife MOT for those in their 40s, 50s and 60s to help them make the right financial decisions for retirement. The midlife MOT provides free online…
Every employee working for a company has a Pay-As-You-Earn (PAYE) code which denotes how much tax you will pay in a year. If this code is incorrect, it could mean you are paying more or less tax than you should be, and may need to reclaim that money, or pay more. Neither is a good…
The latest Budget on March 15 was a mix of wins and losses for people and companies around the country, with some considerable changes for pensions and the highest rate taxpayers thrown in. The personal allowances for the 2023/24 tax year were largely frozen once again, which creates what is known as ‘fiscal drag’ where…
Pensions got a major overhaul in the Chancellor’s Budget announcements, with an increase in the amount you can put into your pension each year and an effective removal of the limit that your pension can reach before facing significant penalties of as much as 55%. Rise in Annual Allowances From April, the Annual Allowance –…
Higher earners have been dealt a blow after the Chancellor changed the level at which the 45% additional rate of tax applies from £150,000 to £125,140. The move takes effect in the 2023/24 tax year and brings the threshold in line with the point at which the personal allowance, which is frozen at £12,570 for…
Up to 30 hours of free childcare per week will become available in England for any child older than nine months from 2024, when there is a staggered introduction starting at 15 hours in April 2024, rising to 30 hours in September 2025. This will be a welcome boost for parents struggling to manage what…
January has earned the dubious distinction of being the month when more couples decide they want to get divorced than any other. The reasons are likely to be myriad, but the likelihood is that they either mark Christmas or New Year as a line in the sand for changing their lives, or simply that spending…
Running an e-commerce business is easier now than ever before. There are a number of ways you can create an online shop without needing to understand coding, whether you want something off-the-shelf or something developed specifically for you. But getting the shop live is just the beginning of your e-commerce journey, and making sure you…
IR35 has been one of the most contentious pieces of accounting legislation since its introduction in April 2021 as HMRC works to prevent those it deems are employed by an organisation taking their income through a separate company. Previously, any large company employing a contractor for services did not need to consider that contractor’s status…
Major changes to the way businesses process goods moving between EU Member states and Northern Ireland where excise duty has been paid came into effect on February 13 and anyone dealing with relevant goods must comply. The new Excise Movement and Control System (EMCS) is replacing the former paper-based system to track the movement of…
Making Tax Digital (MTD) has been on the cards for years now, with businesses already pushed towards dealing with their VAT this way. But plans to extend this for Income Tax Self-Assessment (ITSA) have been put on hold once again until April 6, 2026, eight years later than the original planned launch in 2018. However,…
A new VAT penalties regime was brought in this month, and any firms or individuals missing their filing deadline from January 2023 onwards will receive penalty points even if there is no VAT due to be paid. While this may sound more benign than getting a fine, persistent late filing could lead to more costs…
It is a fact of life that when we lose a loved one, the loss and grief is not all we have to deal with, even though that would be enough. Sadly, there is also a lot of administration that needs to be done by those left behind. This can be anything from registering the…
The taxman has been busy this month – no surprise given it is the time when self-assessment returns need to be filed. But anyone who misses the deadline of January 31 faces a new set of interest rates for penalties that were only published on December 20 last year. The new rates for late payments…
Yes, here we are again, the Christmas tradition of dealing with your self-assessment tax return is back for another year, and you need to get everything sorted as soon as you can. The final deadline for filing your self-assessment is January 31, 2023, for the 2021/2022 tax year, and you are expected to both file…
Christmas parties or even regular summer BBQs, or annual team building events may need to be declared to HMRC for the current 2022/23 tax year if they do not meet certain rules, so you need to be sure you meet all the relevant rules for the exemption. The key conditions are that the party should…
New Extended Producer Responsibility (EPR) come into effect at the very start of 2023, and companies need to be aware of their responsibilities when it comes to every type of packaging from wood, plastic, paper, glass and ‘other’ as determined by the new rules. Businesses selling, importing or handling packaged goods will need to comply…
Working out rateable property values may feel like something of a dark art to those not in the know, and the news that these values are set to change again from April 1 next year could strike fear into the hearts of some. The Valuation Office Agency (VOA), which is part of HMRC, is making…
You could be forgiven for thinking Budget statements are a bit like buses lately – we don’t have one for ages, and then three come along almost at once. While the latest financial proclamation from the Government is known as the Autumn Statement, it is a Budget just the same, and there are some changes…
Changes to the Capital Gains Tax (CGT) allowances announced in the Autumn Statement mean that from next April, the current £12,300 allowance will fall to £6,000 and then to £3,000 in 2024. This is a major concern for landlords with rental property, as this will make a significant dent in the gains they can make…
The 45% additional tax rate was briefly removed by Kwasi Kwarteng, then reinstated by Chancellor Jeremy Hunt, and in the latest twist, Mr Hunt announced that the point at which people would start paying this highest rate of tax would fall from £150,000 to £125,140 from April 2023. This may seem a strange figure to…
It’s that time of year again – the shops are playing Christmas music, there are Christmas films starting to appear on the TV, and for many of us, there is a tax deadline looming, whether that is personal or for our business. This is the busiest time of year for accountants as so many people…
The majority of measures in former Chancellor Kwasi Kwarteng’s mini-Budget have been scrapped after new Chancellor Jeremy Hunt tried to settle markets and politicians across the House of Commons with an Emergency Statement on October 17. Gone is the controversial plan to remove the 45% top rate of tax, and the basic rate of tax…
The UK’s GDP fell by 0.3% in August according to official figures, and if GDP falls for two quarters in a row, that is the definition of a recession. Experts at the EY ITEM Club predict the UK will be in recession for three quarters, which would take us up to the middle of 2023,…
The Plastic Packaging Tax came into effect in April this year, and if your business deals with any kind of plastic packaging in relation to your products, you may need to be registered for this. Anyone importing or manufacturing more than 10 tonnes of plastic packaging each year to the UK will be subject to…
New chancellor Kwasi Kwarteng delivered his first mini-Budget, officially labelled ‘The Growth Plan 2022’, on September 23, and while it largely consisted of tax giveaways, it was not well received by markets. The FTSE 100 fell sharply on the day from 7,221 on September 22 to 6,986 on September 23, breaching the psychologically important 7,000…
The changes to income tax rates are going to benefit all taxpayers from April next year as they get to keep more of the money they have earned. But one knock-on effect is that the amount of tax relief you can get on your pension will be reduced for both 20% and 45% taxpayers, as…
Registered company insolvencies in England and Wales rose by 43% in August this year compared to the same period in 2021, and they were 42% higher than in August 2019, the comparable period before the pandemic. In August this year, there were 1,662 Creditors’ Voluntary Liquidations, 33% more than in August 2021, and 73% higher…
HMRC made some changes to the way Corporation Tax needs to be filed online in September, and companies need to be aware of what they are now expected to do and where there could be difficulties with filing online for certain items. One change which has been announced in The Growth Plan 2022 is that…
Dealing with PAYE is one of the main roles of any accounts department, and HMRC has been busy in this area over the past month, meaning there is plenty for businesses to know for the months ahead. One of the most pressing issues is that PAYE Settlement Agreements are due to be completed by October…
Self-assessment is an annual event, and it is always towards the back end of the year that you need to start thinking about it. Many people will already be registered for self-assessment, but there are others who will need to register for the first time this year, either because they have set up a new…
The end of the summer holidays is upon us and not only does this mean the children going back to school, but also a return to more normal work and family life as we head into the autumn. With prices going up at seemingly ever faster levels, are you getting all the benefits you can…
All deferred VAT payments should have been dealt with by now, but HMRC has flagged in its latest bulletin for August that if your business is one of those that still has not managed to complete the payments that have been delayed, then you could be facing a penalty. During COVID, HMRC allowed businesses to defer VAT…
Many businesses benefited from grants during the pandemic, but how many realise there are other grants they may be able to access at any time to help their business grow and thrive? In fact, there are a large number of grants available across the UK to help businesses with everything from reducing carbon emissions right…
If your business does not qualify for a grant but you still need to get some capital to boost your business, then you may want to consider a business loan. There are many ways to access loan funding and your business bank is likely to be your first port of call. However, there are alternatives,…
Inflation is a word on many of our lips at the moment as the cost-of-living crisis continues unabated. While the headline rate of inflation – which hit 9.4% in June this year – relates to the average inflation rate suffered by individuals living in the UK, the actual rate of inflation different people feel in…
We have all been there. The rising number of employees off over the summer months – especially now the kids have finished school until September – means some departments will be lacking in numbers and some work could get left behind. One area you cannot afford to let this happen in is the back office,…
A change in National Insurance contribution (NICs) levels comes into force at the beginning of July, which should save around 30m people £330 each, according to the Government. From July 6, the amount you can earn before you start paying NICs will increase, which means the amount of overall tax – since NICs is a…
Tax is something that is a certainty in life, as former US President Benjamin Franklin said, but there are lots of ways you can reduce the amount of tax you have to pay by claiming for expenses you may not realise you could. Those of us who are self-employed or own businesses are more likely…
If your business has spent money on plant and machinery and it is subject to corporation tax, then it may qualify for a super deduction which is a temporary allowance you do not want to miss. Qualifying purchases will need to have been made between April 1, 2021, and April 1, 2023, and will be…
Companies and sole traders who have not yet finalised their plans to comply with Making Tax Digital are in the last chance saloon this month, and the very latest date you have to comply with MTD for paying VAT is August 7. That is the latest date on which you will need to make your…
There is a tendency for many of us to leave our tax returns until the last minute. It’s human nature to want to delay dealing with something we find uncomfortable. However, if you get your tax return for the 2021/22 tax year completed sooner rather than later, you will have some benefits that could help…
Putting aside the tax money due each time you have an invoice paid is sensible planning, but is that money working as hard for you as it could be? Many current accounts are paying no interest whatsoever, and when it comes to savings accounts, you would still be struggling to get anything meaty when it…
International trading is something many businesses are involved in, whether it’s because you are selling your good or services abroad or buying raw materials in from overseas to help with manufacturing. Either way, exposing yourself and your business to currency risk is a reality for many businesses, and how you reduce that risk as much…
If you are unlucky enough to be fined for a late filing, then the way in which any appeal can be made changed as of May 7. Prior to this, HMRC had temporarily reintroduced the ability to bulk appeal late filing penalties for income tax in 2020 and 2021. But from now onwards, all such…
Unincorporated businesses – including sole traders, trusts and those businesses working as partnerships, and anyone else that pays tax on trading income – face a major change that will affect the way and the time they are taxed on their profits. The so-called Basis Period Reform will ultimately take effect from the 2024/25 tax year,…
If you are one of those people who is always racing to use up your tax allowances, such as Individual Savings Accounts (ISAs) at the last minute before the end of April 5, then you are not alone. But you could be making a big mistake. When it comes to mopping up tax allowances, it…
Some taxpayers must pay a tax more than once a year, and if this is you then you are facing a second tax bill before July 31. Those exempt from making a payment on account in July include those who had a self-assessment tax bill of less than £1,000 for the previous tax year, or…
Using up personal allowances is not the only reason you should see your accountant at the start of the tax year, it is also the best time to get a health and wealth check for your business too. The end of the tax year is the busiest time for your business and your accountant, meaning…
Anyone filing VAT returns from April 1, 2022 onwards now has to file their return digitally as HMRC’s Making Tax Digital reaches its next phase. All businesses registered for VAT – even if they have turnover below the threshold – must file their returns this way from now on. The premise for changing to the…
The Chancellor’s Spring Statement on March 23 was limited on giveaways, but there were some measures designed to help people struggling with the highest rates of inflation in 30 years. The Office for Budget Responsibility (OBR) has forecast that inflation will average 7.4% this year, and there are many people who are already struggling with…
You may have already noticed when you are buying things online that you are now being asked to confirm your purchase in more than one way to improve security, and this is the result of the new Strong Customer Authentication (SCA) regulations which came into effect on 14 March 2022. What are the SCA regulations?…
The Bank of England (BoE) base rate rose to 0.75% in March in response to Consumer Prices Index (CPI) inflation rising to 5.5% – almost triple the BoE’s target of 2%. Inflation is set to continue rising throughout the year (see Spring Statement round-up) with the Russian invasion of Ukraine creating increased pressure on already…
The new tax year on April 6 is accelerating quickly towards us, and now is the time to make sure that any last-minute allowances you may not have made the most of in the 2021/22 tax year are mopped up. There are plenty of allowances that have a time limit on each tax year, and…
Married Couple’s Allowance can be transferred between spouses and civil partners, and while 2m couples have claimed this since it was introduced back in 2015, there are many more people who are entitled to claim it. Go back four years The allowance, which is worth up to £1,220 for each year, can be reclaimed back…
The Government is set to increase National Insurance Contributions (NICs) by 1.25% from April to fund the Health and Social Care Levy, and while this may be a laudable aim, it is going to hit all of us in the pocket. Costly increase when finances are being squeezed The NICs hike means that someone earning…
The bounce back loans, CBILS and CLBILS for larger companies were some of the most generous schemes available to businesses suffering from the impact of lockdowns due to the Covid-19 pandemic, paying out a total of £80 billion to help keep businesses afloat. The Bounce Back Loan Scheme was the largest of these, paying out…
Inheritance tax (IHT) is one of the most hated taxes there is, mainly because for many people their estate faces a 40% tax rate which is higher than they would have paid during their lifetime. HMRC’s latest figures reveal there has been a £700m increase in IHT receipts in the financial year to January 2022,…
Stamp Duty Land Tax (SDLT) receipts were somewhat skewed in the last year as the SDLT holiday for properties worth up to £500,000 was phased out on June 30, 2021, and the holiday for properties worth between £125,000 and £250,000 ended on September 30. These two deadlines resulted in a flurry of activity as people…
Businesses and self-assessment taxpayers are being reminded they need to include all grants paid as part of the COVID-19 support payments in their tax returns, as some may think these were non-taxable. Have you set money aside to deal with tax on support grants? HMRC has highlighted that all money paid for test and trace…
Millions of taxpayers who are yet to submit their completed Self-Assessment tax return which is due before January 31 are being given a grace period to file until February 28. More than 12.2 million customers are expected to complete a tax return for the 2020/21 tax year according to HMRC, and would usually face a…
Companies forced to close due to Coronavirus restrictions are currently protected from eviction by landlords until March 25, but a Government Bill currently before Parliament is expected to create binding arbitration following this date. Code of Practice The Commercial Rent (Coronavirus) Bill, which was originally announced alongside a Code of Practice by Kwasi Kwarteng on…
Companies with debts outside of their rental arrears face the removal of protection against creditor actions from March 31, 2022. Other debts outside rental arrears affected Currently, rent arrears built up because of forced closures as a result of COVID-19 are excluded from these measures, as they are covered by other legislation Any debts outside…
If you need to file a self-assessment tax return for the year to 5 April 2021, you have until midnight on 31 January 2022 to file your return if you have not already done so. You must also pay any tax that you owe for 2020/21 by the same date. Do I need to file…
Payments on account are advance payments towards your tax and, where relevant, your Class 4 National Insurance bill. You may need to make them if you are self-employed or if you are a landlord. You may also need to make them if you operate your business through a personal or family company and extract the…
Financially, 2021 has been a difficult year for many, and you may be struggling to pay your January tax bill in full. Any tax and National Insurance that remains unpaid for 2020/21 must be paid by 31 January 2022, along with the first payment on account for 2021/22. Contact HMRC If you cannot pay your…
To help employers affected by the spread of the Omicron variant of COVID-19, the Statutory Sick Pay (SSP) rebate scheme for small employers is being reintroduced. In addition, the period for which an employee can self-certify a sickness absence is increased temporarily from seven days to 28 days. SSP rebate scheme The SSP rebate scheme…
HMRC have published a call for evidence on the case for reforming the rules for registering for Income Tax Self Assessment (ITSA). The call for evidence is interested in hearing views on whether it would be beneficial to bring forward the deadline by which landlords and the self-employed must register for ITSA. Current rules Currently,…
Under Real Time Information (RTI), you must report payments made to employees and associated deductions to HMRC on a Full Payment Submission (FPS) at or before the time at which you make the payment to your employee. However, special rules apply which modify this rule if you pay your employees earlier than usual over the…
Making Tax Digital (MTD) is a Government initiative that aims to provide the UK with one of the most digitally advanced tax administrations in the world. Under MTD, taxpayers are required to keep electronic records and report to HMRC digitally. MTD is being implemented in stages. However, the timeline has recently been revised, delaying the…
If you are holding a Christmas party for staff this year, you may want to take advantage of the tax exemption for annual parties and functions to prevent your employees from suffering a benefit-in-kind tax charge. Keeping the Christmas party tax-free will also mean that there is no Class 1A National Insurance for you to…
Christmas is a time of giving, and you may wish to give your employees a small token of your appreciation for their work during the year. To prevent the gift being accompanied by an unwanted tax liability, you can take advantage of the trivial benefits exemption to keep the gift tax-free. Scope of the exemption…
A tax charge may arise if an employee is able to use a company car or van for private use. A further charge will arise if you provide the fuel for any private use. The taxable amounts that will apply for 2022/23 have now been announced. Company cars Where an employee has a company car,…
The Chancellor presented his Autumn Budget and Spending Review on 27 October 2021. Some of the highlights are discussed below. Income tax rates and thresholds The rates and thresholds applying for 2022/23 were confirmed. Personal allowance As previously announced, the personal allowance remains at £12,570 for 2022/23. The allowance is reduced by £1 for every…
The Annual Investment Allowance (AIA) is a capital allowance that enables you to claim an immediate deduction against your profits for qualifying capital expenditure up to the available limit. The AIA limit was temporarily increased from £200,000 to £1 million from 1 January 2019 to 31 December 2021. It was due to return to its…
To help the hospitality and leisure industries recover from the impact of the COVID-19 pandemic and associated lockdowns, a reduced rate of VAT of 5% applied from 15 July 2020 until 30 September 2021. This rate has now come to an end, and a new reduced rate of 12.5% applies from 1 October 2021 until…
From 4 April 2022, applicants applying to renew certain licences will need to pass a tax check before their licence application can be considered. Initially, the requirement will only apply in England and Wales. However, the Government have consulted on extending the requirements to Scotland and Northern Ireland from 2023. Licences affected Tax conditionality (the…
The deadline for filing your 2020/21 self-assessment tax return is midnight on 31 January 2022. However, if you have underpaid tax and you are employed and would prefer HMRC to collect that underpayment through your tax code, you will need to file your return online by midnight on 30 December 2021. You can also have…
On 8 September 2021, the Prime Minister outlined the Government’s plans for health and social care, including a new funding strategy designed to meet social care costs. A new tax, the Health and Social Care Levy, is to be introduced from 2023. However, as a temporary measure prior to its introduction, National Insurance contributions will…
Making Tax Digital (MTD) for VAT is currently only compulsory for VAT-registered businesses whose turnover for VAT is above the VAT registration limit of £85,000. However, this is set to change from April 2022. Extension to all VAT-registered businesses Currently, if you are registered for VAT, but your turnover for VAT purposes is less than…
If you agreed a PAYE Settlement Agreement (PSA) with HMRC for 2020/21, you will need to pay the tax and Class 1B National Insurance that is due in October 2021. The deadline for paying the tax and National Insurance is 22 October if you make your payment electronically, or 19 October if you pay by…
HMRC have been consulting on the reform of the basis period rules in preparation for the introduction of Making Tax Digital for Income Tax Self-Assessment (MTD ITSA), which comes into effect from April 2023. A consultation paper was published in July 2021, which sets out new simplified basis period rules. Comments were sought by 31…
The recent ‘pingdemic’ has resulted in large numbers of employees self-isolating. Where an employee meets the qualifying conditions, you must pay them SSP while they are self-isolating. As qualifying periods of self-isolation count as a Coronavirus-absence, if you are a small employer, you may be able to reclaim the SSP paid to self-isolating employees from…
The Government have recently named and shamed well-known employers who have fallen foul of the National Minimum Wage legislation. They have also published a list of ‘outrageous excuses’ cited by employers who have failed to pay the minimum wage. Legal requirement to pay at least the minimum wage As an employer, you have a legal…
The plastic packaging tax is a new tax which is being introduced from 1 April 2022. The tax aims to provide a financial incentive to use recycled plastic in plastic packaging, which in turn will boost recycling and divert plastic away from landfill. You may have to pay the tax if you manufacture or import…
You may be able to benefit from funding under the Kickstart Scheme if you are looking to create new jobs for young people. Information on the scheme can be found in the Kickstart Scheme Employer Prospectus. Nature of the scheme The scheme aims to create jobs for young people who are unemployed. The job must…
If you have received one or more grants under the Self-Employment Income Support Scheme (SEISS), it is important that you report the payments correctly on your tax return. 2020/21 self-assessment tax return SEISS grants that were received in the 2020/21 tax year (i.e., between 6 April 2020 and 5 April 2021) should be reported on…
The EU e-commerce package came into effect on 1 July 2021. It introduced reforms in respect of the movement of goods from Northern Ireland to the EU and imports of low value goods into the EU or Northern Ireland. Who is affected? The changes will affect you if you: sell or supply goods from Northern…
During the COVID-19 pandemic, HMRC paused much of their debt collection work, both to divert resources to administering the various COVID-19 support schemes and to help taxpayers whose finances were adversely affected by the pandemic. However, as the country emerges from the Coronavirus crisis, HMRC have restarted their tax debt collection work and will be…
If you take on temporary staff over the summer, you will need to pay them at least the National Living or Minimum Wage appropriate to their age. Workers aged 23 and over Workers aged 23 and over are entitled to be paid at least the National Living Wage (NLW). This is set at £8.91 per…
Now that the ‘work from home if you can’ guidance has been lifted, employees are returning to the office. If, following their return, you allow employees to keep their homeworking equipment for personal use, there may be tax consequences to consider. Employer-provided equipment If you provided homeworking equipment to your employees to enable them to…
Claims for the fifth grant under the Self-Employment Income Support Scheme (SEISS) will open from late July. If, based on your tax returns, HMRC think that you are eligible for the grant, they will contact you in mid-July and give you a date from which you can submit your claim. The fifth grant will cover…
A new relief has been introduced for employers of armed forces veterans which allows them to benefit from a zero rate of secondary National Insurance contributions on the earnings of the veteran up to a new upper secondary threshold. However, while the relief applies from 6 April 2021, for 2021/22 employers must pay secondary contributions…
The residential stamp duty land tax (SDLT) threshold applying in England and Northern Ireland was temporarily increased to £500,000 from 8 July 2020 to 30 June 2021 (extended from the original end date of 31 March 2021). From 1 July 2021 to 30 September 2021, a new temporary residential threshold of £250,000 applies. The threshold…
As the Coronavirus Job Retention Scheme (CJRS) enters its final months, now is the time to review grants that you have claimed under the scheme, and pay back any amounts claimed in error. You may also choose to repay voluntarily funding that you have received under the scheme if your business does not need it.…
From 15 June 2021, all businesses and organisations will need multi-factor authentication in order to sign into the Government Gateway. Multi-factor authentication Businesses and organisations that use HMRC’s online services and which do not currently receive an access code by text or voice call, or direct to an authenticator app, will need to add a…
If you are an employer and you provided taxable expenses and benefits to your employees during the 2020/21 tax year, you will need to report these to HMRC on form P11D, unless all benefits were payrolled or included within a PAYE Settlement Agreement. You will also need to file a P11D(b). Both forms must reach…
If you are an employee and you are, or have been, working from home as a result of the COVID-19 pandemic, you may be able to claim tax relief for the additional household costs that you have incurred as a result. HMRC are now accepting claims for the current (2021/22) tax year. Nature of the…
If you are self-employed, you will pay Class 2 and Class 4 National Insurance contributions if your profits exceed the relevant thresholds. Class 2 National Insurance contributions are the mechanism by which you build up qualifying years to earn entitlement to the state pension and certain contributory benefits. If your profits are below the small…
If you have some shares that have become worthless, you can make a negligible value claim. This will allow you to set the associated loss against any chargeable gains that you make in the same, or a later, tax year, potentially reducing the amount of capital gains tax that you pay. Making a claim A…
You can use a PAYE Settlement Agreement (PSA) if you wish to settle the tax liability arising on the provision of a benefit-in-kind or an expense on an employee’s behalf. This can be useful if you wish to preserve the goodwill nature of a particular benefit. Nature of a PSA Where a PSA is in…
To help businesses which have suffered losses as a result of the COVID-19 pandemic, the period for which certain trading losses can be carried back is extended from one year to three years. The extended carry-back period applies for both income tax and corporation tax purposes. If you have made losses as a result of…
If you need to access finance to help your business recover from the effects of the COVID-19 pandemic, the Recovery Loan Scheme may be for you. Nature of the scheme The Recovery Loan Scheme is designed to provide access to finance in order to support businesses as they recover from the disruption caused by the…
If you are an employee with a company car, you will be taxed on the benefit derived from the car being available for your private use. If you are an employer who makes company cars available to your employees, they will be taxed on the associated benefit. The amount that is charged to tax depends…
Stamp duty land tax (SDLT) is payable when you buy a property in England or Northern Ireland. Last year, the SDLT residential threshold was temporarily increased to £500,000 with effect from 8 July 2020. The threshold was due to revert to its normal level of £125,000 from 1 April 2021, but this has now been…
If you run your business as a personal or family company, you will need to decide how best to extract profits for your personal use. A typical tax-efficient strategy is to pay yourself a small salary and then extract any further profits as dividends. Where this approach is adopted, you will need to determine your…
To help meet some of the costs of the COVID-19 pandemic, the Chancellor has opted to freeze various allowances and thresholds until April 2026, rather than increase the rates of income tax and capital gains tax. As incomes rise over the period, more people will pay tax, and more people will pay tax at the…
The Coronavirus Job Retention Scheme (CJRS) has provided a lifeline for many employers and employees during the COVID-19 pandemic. The scheme was due to come to an end on 30 April 2021. However, at the time of the 2021 Budget, the Chancellor, Rishi Sunak, announced that the scheme would, once again, be extended. It will…
The Self-Employment Income Support Scheme (SEISS) provides grant support to eligible self-employed taxpayers who have been adversely affected by the COVID-19 pandemic. A further two grants are to be paid under the scheme. In addition, the scheme has been expanded to include those who commenced self-employment in 2019/20. Guidance on the grants can be found…
Companies within the charge to corporation tax who invest in new plant and machinery in the two years from 1 April 2021 are able to benefit from two new first-year allowances, including a super-deduction of 130%. Details of the measure are set out in a policy paper published by the Government. The super-deduction Companies that…
The main rate of corporation tax is due to increase to 25% for the financial year 2023, starting on 1 April 2023. However, companies with profits of £50,000 or less will continue to pay corporation tax at the current rate of 19%. Companies whose taxable profits fall between £50,000 and £250,000 will pay corporation tax…
The extension to the off-payroll working rules finally comes into effect from 6 April 2021, having been delayed by a year as a result of the COVID-19 pandemic. The rules were originally introduced from 6 April 2017 where a worker’s services were provided to a public sector body via an intermediary. The extension from 6…
Business interruption insurance policies provide cover for losses that arise if a business is severely disrupted or is forced to close. The policy will cover losses that arise as a result, and also fixed costs that the business has to continue to pay while shut. Many businesses that expected their policies to pay out when…
The 2021/22 tax year starts on 6 April 2021. If you employ staff, you will need to update their tax codes before you pay them for the first time in the new tax year. However, remember to finalise the 2020/21 tax year before updating your payroll software and data for 2021/22. Tax codes from 6…
If you are a taxpayer and you make a Gift Aid declaration when making a donation to a charity, the charity can reclaim basic rate tax on your donation. Tax relief on the donation A donation made under Gift Aid is treated as being made net of the basic rate of tax, currently 20%. The…
HMRC announced in January that they would not charge a late filing penalty if your 2019/20 tax return was not filed by midnight on 31 January 2021, as long as the return was filed by 28 February 2021. Any tax due by 31 January 2021 should still have been paid by that date, unless a…
The Government would like to hear your views on proposals for a new process for keeping records for corporation tax purposes and reporting tax information to HMRC, known as Making Tax Digital (MTD). Your comments will help ensure that the design makes it as easy as possible for smaller businesses to comply when the rules…
The normal deadline for filing the 2019/20 tax return is 31 January 2021. However, HMRC announced in a press release issued on 25 January 2021 that they would not issue a late filing penalty as long as the 2019/20 tax return is filed online by 28 February 2021. However, any tax due by 31 January…
The domestic VAT reverse charge for building and construction services finally comes into effect on 1 March 2021. The start date was originally 1 October 2019, but it was postponed by one year until 1 October 2020 to allow those affected more time to prepare. The start date was further delayed – until 1 March…
The Coronavirus Job Retention Scheme (CJRS) provides grant support to enable employers to continue to pay staff who are fully or flexibly furloughed. The scheme can be used for staff who have been furloughed because they have caring responsibilities. School closures On 4 January 2021, the Prime Minister, Boris Johnson, announced that England would enter…
You must pay employees at least the statutory minimum wage, either the National Living Wage (NLW) or the National Minimum Wage (NMW), depending on the employee’s age. From 1 April 2021, the age threshold for payment of the NLW is lowered and the rates of the NLW and the NMW are increased. National Living Wage…
The second National Lockdown and local restrictions may mean that you are unable to meet the tests for your holiday let to qualify as a furnished holiday letting (FHL) for 2020/21. However, where this is the case, all is not lost as there are alternative routes by which your let might meet the FHL requirements.…
The Brexit transitional period came to an end on 31 December 2020. As a result, new rules applied from 1 January 2021. As the situation is evolving, it is recommended that you check the guidance on the Gov.uk website regularly. EORI number From 1 January 2021 you need an EORI number to move goods between…
England went into the third national lockdown on 5 January 2021. To help business affected, the Chancellor unveiled a £4.6 billion package to help businesses forced to close. The grants are in addition to the monthly support payments previously announced. Cash grant for closed businesses If your business is in a sector such as non-essential…
31 January self-assessment deadline approaching There are a number of key tasks that you need complete by midnight on 31 January 2021. These include filing the self-assessment tax return for 2019/20, paying any remaining tax due for 2019/20 and, where applicable, calculating and paying the first payment on account for 2020/21. Filing deadline The deadline…
The CJRS, furloughed staff and Christmas holidays Following the announcement of more stringent lockdown measures, the Chancellor, Rishi Sunak, announced yet another extension to the Coronavirus Job Retention Scheme (CJRS). The scheme will now run until the end of April 2021. Under the extended scheme, claims must be made within 14 days of the end…
Virtual Christmas parties and tax-free gifts The COVID-19 pandemic has meant that the traditional Christmas party could not happen in 2020. If, instead, you held a virtual event, you will be pleased to know that this too can benefit from the tax exemption for annual parties and functions. There is also good news if you…
The Coronavirus Job Retention Scheme (CJRS) was due to come to an end on 31 October 2020, being replaced from 1 November 2020 with a new scheme – the Job Support Scheme. However, the second national lockdown in England changed all that. The CJRS has been reprieved and will now continue to run until 31…
The Self-Employment Income Support Scheme (SEIS) will now run until 30 April 2021, providing two further grants – one for the three months from 1 November 2020 to 31 January 2021 and one for the three months from 1 February 2021 to 30 April 2021. Since the extension to the scheme was originally announced, the…
Although the deadline by which your 2019/20 self-assessment tax return must be filed online is 31 January 2021, an earlier deadline of 30 December 2020 applies if you want any tax that you owe for 2019/20 to be collected through PAYE. This can be advantageous as you can spread the cost across the tax year,…
The Brexit transitional period comes to an end on 31 December 2020. From January 2021, new arrangements apply if you send goods abroad from the UK or bring goods into the UK. It is important that you check what customs declarations you need to make from 1 January 2021 onwards. Where goods are moved through…
Earlier this year, the Government published a timetable for taking the Making Tax Digital (MTD) programme forward. As part of that programme, MTD will be extended to corporation tax. Although, this will not be mandatory until at least 2026, HMRC are now consulting on the design. Businesses will be given the chance to take part…
The Annual Investment Allowance (AIA) enables a business which incurs qualifying expenditure to claim an immediate deduction when computing taxable profits. The deduction is capped at the amount of the AIA limit for the period which remains available. The AIA limit was increased from its permanent level of £200,000 to a temporary level of £1…
Postponed VAT accounting is being introduced from 1 January 2021. This will affect you if you are VAT-registered and you import goods into the UK, particularly if you are a smaller business and you do not currently use the Duty Deferment Scheme. Postponed VAT accounting will apply to goods imported into the UK from all…
The Job Support Scheme replaces the Coronavirus Job Retention Scheme from 1 November 2020. The scheme, which has already evolved since it was originally announced to provide a greater level of support, will run for six months until 30 April 2021. The Government will review the level of support provided under the scheme in January…
To help self-employed individuals who continue to be affected by the COVID-19 pandemic, the Self-Employment Income Support Scheme (SEISS) has been extended for a further six months, from November 2020 to April 2021. Grants payable under the extended scheme The extended scheme will provide two taxable grants for the self-employed. Availability of the grants is…
In his Winter Economy Plan, the Chancellor, Rishi Sunak, unveiled measures which will allow self-assessment taxpayers and VAT-registered businesses more time to pay back deferred tax. New Payment Plan for VAT At the start of the pandemic, VAT-registered business could delay paying VAT where it fell due between 20 March 2020 and 30 June 2020.…
The Government launched four temporary Government-backed schemes to provide finance to businesses struggling as a result of the COVID-19 pandemic: the Bounce Back Loan Scheme (BBLS); the Coronavirus Business Interruption Loan Scheme (CBILS); the Coronavirus Large Business Interruption Loan Scheme (CLBILS); and the Futures Fund. The deadline for new applications under the schemes has been…
Rishi Sunak has announced that the third SEISS grant will now be based on 40% of average trading profits and businesses temporarily unable to trade due to coronavirus will be eligible. In his third economic statement within the last month, the Chancellor confirmed more generous terms for the remaining Self-employment Income Support Scheme (SEISS) grants. The level…
Changes announced by Rishi Sunak today will bring more flexibility to the JSS and reduce costs to employers for employees working fewer hours due to the coronavirus pandemic. The Job Support Scheme (JSS), the next phase of UK government support for business and employment during the COVID pandemic, starts on 1 November 2020. The Chancellor’s announcement…
Firms across Wales are preparing themselves for further disruption in anticipation of the two-week “firebreak” COVID lockdown due to kick in on Friday. But what support is available for businesses forced to close? The Welsh first minister Mark Drakeford has insisted that the lockdown from 6pm on 23 October until 9 November, is needed to…
The extension to the off-payroll working rules was put on hold as a result of the COVID-19 pandemic. However, the legislation has now been implemented and the new rules will come into effect from April 2021 – one year later than originally planned. As the Coronavirus Job Retention Scheme draws to a close and businesses…
When your employees return to the office, they may no longer need the homeworking equipment that enabled them to continue to work during lockdown and beyond. Are there any tax implications if they return the equipment or if they keep it? Employer provided the homeworking equipment If you provided equipment to enable your employees to…
The annual investment allowance (AIA) was temporarily increased from £200,000 to £1 million for two years, from 1 January 2019 to 31 December 2020. The allowance reverts back to its usual level of £200,000 from 1 January 2021. While the COVID-19 pandemic may have put projects on hold, you may want to review planned capital…
If you have a PAYE Settlement Agreement (PSA) in place for 2019/20, you will need to pay the tax and National Insurance due under the agreement by 22 October 2020, assuming payment is made electronically. If you pay by cheque, the cheque must reach HMRC by the earlier date of 19 October 2020. Nature of…
Landlords should realise that HMRC will know about their lettings through Airbnb, so full disclosure of all their taxable property income is essential, including for all prior years. The Airbnb UK accounts for the year to 31 December 2019 include a statement that the company will share data with HMRC about the earnings of hosts (those who let…
Many family companies have struggled as a result of the COVID-19 pandemic and may no longer have any retained profits. Where this is the case, they may need to rethink how they extract funds from their company to meet their personal bills. Dividend problem A popular and tax-efficient strategy is to pay family members a…
Rishi Sunak has unveiled a range of measures to stave off the threat of mass unemployment, including a new Job Support Scheme which will contribute to some workers’ wages from November. Speaking in the House of Commons, the Chancellor announced a variety of new measures and extensions to existing ones as part of the government’s Winter…
The Self Employment Income Support Scheme (SEISS) provides grants to self-employed taxpayers whose business has been adversely affected by the Coronavirus pandemic. Eligible taxpayers can now claim the second and final grant under the scheme. Grants paid out under the scheme are taxable. Eligibility To qualify for the second grant, you must be a sole…
HMRC have moved into the next phase of their compliance activity in relation to the Coronavirus Job Retention Scheme (CJRS) and have written to 3,000 employers who they believe may have either claimed more under the scheme than they were entitled to or who did not meet the conditions for making a claim. Legislation introduced…
The Coronavirus Job Retention Scheme (CJRS) comes to an end on 31 October 2020. As the scheme winds down and employers start meeting some of the associated costs, they will face difficult decisions as to whether they can bring employees back to work or whether they need to make some employees redundant. New legislation has…
A tax charge arises under the benefit-in-kind rules where an employee enjoys unrestricted private use of a company van. The taxable amount is a set amount, with a reduced charge applying to electric vans. However, the charge for zero-emission vans is to be reduced to zero from 6 April 2021. Taxation of company vans Employees…
HMRC has updated its guidance on telling them about an ineligible receipt of grant or an overpayment under the Self-Employment Income Support Scheme (SEISS). The update covers when HMRC must be told and the grant be repaid as well as the penalties that may be incurred. View the updated guidance at https://www.gov.uk/guidance/tell-hmrc-and-pay-the-self-employment-income-support-scheme-grant-back and for more…
HMRC has published guidance on what to do if you find that you have claimed too much or not enough under the Coronavirus Job Retention Scheme (CJRS). You can read the guidance in full, here: https://www.gov.uk/guidance/if-youve-claimed-too-much-or-not-enough-from-the-coronavirus-job-retention-scheme If you’ve claimed too much If you want to delete a claim in the online service, you must do…
On 21 July, the Treasury published a report, “Building a trusted, modern tax administration system“, which sets out the Government’s vision of what they wish to achieve in the next ten years. The vision comprises three elements – policy, systems and law and practice. The ‘policy’ vision means a progressive extension of HMRC’s Making Tax…
The Chancellor, Rishi Sunak, presented “A Plan for Jobs” at the time of the Summer Economic Update on 8 July 2020. This included incentives for employers who retain furloughed staff and who offer training and apprenticeships. Job Retention Bonus The Coronavirus Job Retention Scheme (CJRS) is now in its final phase. Government support under the…
The second and final phase of the Coronavirus Job Retention Scheme (CJRS) runs from 1 July 2020 to 31 October 2020. During this phase, furloughed workers may return to work part-time under the flexible furloughing provisions. New rules also apply from 1 July 2020 to determine the length of the claim period. Claims must start…
To help boost the housing market and allied sectors, the residential Stamp Duty Land Tax (SDLT) threshold in England and Northern Ireland has been increased from £125,000 to £500,000 for a temporary period from 8 July 2020 to 31 March 2021. Increases have also been announced to the residential thresholds for Land and Buildings Transaction…
To support businesses and jobs in the hospitality sector, the reduced (5%) rate of VAT applies to supplies of food and non-alcoholic drinks from restaurants, pubs, bars, cafés and similar establishment across the UK for a temporary period from 15 July 2020 to 12 January 2021. The reduced rate of VAT (5%) also applies to…
Following the Chancellor’s Summer Statement, HMRC has issued guidance on the application of the temporary 5% reduced rate of VAT to support the hospitality sector. The rate cut applies to certain supplies of hospitality, hotel and holiday accommodation and admission to certain attractions from 15 July 2020 to 12 January 2021. HMRC’s guidance confirms that the temporary 5%…
VAT on eating out, accommodation and tourist attractions will be cut to 5% to help the UK’s hospitality sector recover from the impacts of the coronavirus pandemic. In his Summer Statement, the Chancellor announced a six-month reduction in the VAT rate on supplies of food and non-alcoholic drinks from restaurants, pubs, bars and cafés, as well…
The Chancellor has cut stamp duty land tax (SDLT) to encourage confidence in the residential property market following the coronavirus lockdown. The housing market has been severely hit by the COVID-19 pandemic, with both house sales and construction activity slowing. As part of the government’s “Plan for Jobs” – in particular job creation – the Chancellor announced an…
Employers who retain staff for three months after the furlough scheme ends will receive £1,000 government ‘bonus’ for each employee, the Chancellor has announced. One of the main purposes of the Coronavirus Job Retention Scheme (CJRS) has been to support continued employment rather than face the prospect of mass redundancy. In his Summer Statement, the Chancellor confirmed that…
The Chancellor’s Summer Statement put forward a plan for jobs, green investment and a variety of targeted tax cuts, but also signalled a clear intention to wean businesses off government support. Billed as the second part of a three-phase plan to secure the UK’s economic recovery from coronavirus, Chancellor Rishi Sunak’s statement focussed firmly on…
Businesses eligible for the first Self-employment Income Support (SEISS) grant must make their claim by Monday 13 July. When applications for SEISS grants opened in mid-May HMRC did not specify any deadline for claims – the deadline of 13 July 2020, announced when the scheme was extended, is now approaching and claims for the first grant must…
Taxpayers facing financial difficulties as a result of the COVID-19 pandemic can opt to delay making their second self-assessment payment on account for 2019/20, due by 31 July 2020. As long as the amount is paid in full, together with any outstanding balance for 2019/20, by 31 January 2021, HMRC will not charge any interest…
The Coronavirus Job Retention Scheme (CJRS) has provided a lifeline for many employees and employers during the COVID-19 pandemic. As at 21 June 2020, 9.2 million employees had been furloughed by 1.1 million employers who had, collectively, claimed grants totalling £22.9 billion. Prior to 30 June 2020, employees who had been furloughed could not work…
The COVID-19 pandemic and restrictions on trade have led many businesses to change what they do in a bid to survive. An example of this is the village pub opening instead as a local shop selling food and other essentials. Alternatively, a business may have ceased trading temporarily as a result of the lockdown. HMRC…
The Self-Employment Income Support Scheme (SEISS) has been extended. Eligible self-employed taxpayers will be able to claim a second, and final, grant under the scheme in August. Eligibility The eligibility criteria for the second grant are the same as the first. To qualify, the individual must: have submitted their self-assessment tax return for 2018/19 by…
Various support payments have been made to help those affected by the COVID-19 pandemic. How are those payments treated for National Insurance purposes? Grant payments under the CJRS Where an employer claims a grant payment under the Coronavirus Job Retention Scheme (CJRS), the full amount of the grant (topped up to 80% of wages in…
Employers will be able to make claims for grants under the flexible furlough scheme (CJRS V2) from 1 July 2020. Our detailed guide to the new scheme is here but to summarise the changes: The first version of the Coronavirus Job Retention Scheme (CJRS), whereby employees had to be furloughed full time, ends on Tuesday…
HMRC has updated its guidance on whether a business has been “adversely affected” by coronavirus and therefore able to claim for the two Self-employed Income Support Scheme (SEISS) grants. On 12 June HMRC published examples to show when the “adversely affected” criteria for the first and second SEISS grants will be met. It confirms that those who…
How the Coronavirus Job Retention Scheme is changing from 1 July, including the introduction of flexible furlough. The CJRS is changing from 1 July to encourage those furloughed back into work. Following the publication of HMRC’s detailed guidance, here is an outline of the key changes. Contents: What you need to know Flexible furlough: What…
Changes to the Coronavirus Job Retention Scheme (CJRS) will apply a month earlier than expected. From 1 July the scheme will allow part-time working, but staff must have been furloughed by 10 June to be eligible. The Chancellor has announced the government’s plans to change the CJRS which will now be re-engineered to support businesses sending staff…
The Chancellor has announced a second and final grant to the self-employed who are eligible for the Self-employment Income Support Scheme (SEISS), based on 70% of earnings and capped at £6,570. HMRC has confirmed the same eligibility criteria will be used to establish self-employed individuals’ entitlement to a further SEISS grant; the grant will be 70 rather…
Smaller employers who have paid statutory sick pay (SSP) to employees who were absent from work due to a Coronavirus-related absence can now claim a rebate from the Government. The claim portal went live on 26 May 2020. Who can claim? Employers are eligible to make a claim if they have a payroll scheme that…
Employers who provided taxable expenses and benefits to their employees during the 2019/20 tax year will, as usual, have to tell HMRC about these by 6 July 2020. This obligation is unchanged despite the COVID-19 pandemic. Form P11D Form P11D is used to tell HMRC about taxable benefits and expenses provided to employees where these…
HMRC have recently published guidance for employers on how to treat certain expenses and benefits which may be provided to employees during the COVID-19 pandemic. The guidance is available on the Gov.uk website. They have also relaxed the rules for a limited period where an employer reimburses an employee for the cost of equipment purchased…
Small employers and their tax agents will be able to submit claims for rebates of statutory sick pay linked to coronavirus from 26 May, HMRC has confirmed. The Coronavirus Statutory Sick Pay Rebate Scheme (CSSPRS) enables small and medium-sized employers to recover statutory sick pay (SSP) payments made to their employees, or former employees, when…
The Chancellor, Rishi Sunak, announced on 12 May that the Coronavirus Job Retention Scheme would be extended until 31 October 2020. The scheme enables employers adversely affected by the COVID-19 pandemic to furlough staff rather than making them redundant, and to claim a grant from the Government for 80% of their wages up to £2,500…
The Chancellor has extended the government’s Coronavirus Job Retention Scheme until the end of October and announced the introduction of new ‘part-time’ furlough flexibility from August. Speaking at the Houses of Parliament, Rishi Sunak told MPs that the Coronavirus Job Retention Scheme (CJRS) will continue in its current form until the end of July, and…
After mounting pressure for clarification on the COVID-19 support that was expected to be made available on the 26 March, the Chancellor Rishi Sunak has now announced the details of the self-employed income support scheme (SEISS) and how it will work. SEISS is a taxable grant payable to the self-employed (including partners). It is set…
One-year extension for MTDfV soft landing In a welcome response to COVID-19, HMRC has extended its digital links ‘soft landing period’ by twelve months to April 2021. HMRC Email In a widely distributed email issued on 30 March 2020, HMRC stated: “We understand that the impact of COVID-19 is creating extremely difficult times for all,…
A popular profit extraction strategy for personal and family companies is to pay a small salary and to extract further profits as dividends. With new National Insurance thresholds applying for 2020/21, what is the optimal salary for the new tax year? Starting point – what can be paid free of tax and National Insurance? Assuming…
As a result of the COVID-19 pandemic, many employees are now working at home in accordance with Government instructions to help reduce the spread of Coronavirus. Providing equipment to employees working from home Employees may need tools and equipment to enable them to work from home. For example, employees who are office based, may need…
The online claim portal for the Coronavirus Job Retention Scheme (CJRS) went live on 20 April 2020, allowing employers who have furloughed staff as a result of the COVID-19 pandemic to claim grants from the Government equal to 80% of the employee’s wages (capped at £2,500 per month). Employers can also claim the associated employer’s…
Online platform ‘The Skills Toolkit’ will help people to build their skills during the coronavirus outbreak and beyond. A new online learning platform to help boost the nation’s skills while people are staying at home, has been launched by Education Secretary Gavin Williamson. Free courses are available through a new online platform hosted on the…
The chancellor has announced a new Bounce Back loan scheme, allowing small businesses hit by the impact of coronavirus measures to apply for up £50,000, with the government guaranteeing 100% of the advance. Billed by chancellor Rishi Sunak as a “simple, quick, easy solution for those in need of smaller loans,” businesses can apply from…
Updated guidance from HMRC includes how to report wages using RTI, a new calculator and more explanation about who qualifies. On 24 April 2020, several pages of HMRC guidance on how to use the Coronavirus Job Retention Scheme (CJRS) were updated and more have been added to GOV.UK. For employers and agents who spent much…
Approvals for the government’s emergency loan scheme for small and medium-sized businesses are increasing at a much faster rate than applications, according to the latest industry figures. Data from industry group UK Finance provided good news for beleaguered businesses on the Coronavirus Business Interruption Loan Scheme (CBILS), as application approvals increased from 21% to 46%.…
With the next VAT deadline date of 7 May fast approaching, we wanted to send a reminder of the process for those who wish to utilise the VAT payment deferral announced by the Chancellor in March. There’s no need to apply for a deferral BUT: You are still required to file a…
CJRS – emerging issues and answers The ‘Top 10 things we don’t know’ article has been expanded to summarise additional emerging issues about the Coronavirus Job Retention Scheme (CJRS) and the answers that HMRC has provided. 1. Agent access to the system It was not clear exactly what authority agents need to have in place…
Cybercriminals unleash wave of COVID-19 attacks on businesses Within 24 hours of the government’s Coronavirus Job Retention Scheme being launched, online fraudsters had sent a flurry of phishing emails targeting unsuspecting businesses claiming to be from HMRC chief executive, Jim Harra. London-based accountancy firm Lanop Group told Computer Weekly that cybercriminals have been quick to…
CJRS calculator and latest guidance from HMRC As the Coronavirus Job Retention Scheme (CJRS) opens, HMRC launches its calculator tool to help businesses work out how much they can apply for. See a link here alongside a list of the latest guidance from HMRC. Ahead of the CJRS portal opening today, HMRC launched its calculator…
Last-minute extension and new guidance for furlough scheme A month-long extension to the Coronavirus Job Retention Scheme and last minute help and support has been announced by the government less than 72 hours before launch. It was announced this afternoon that the Coronavirus Job Retention Scheme (CJRS) will be now be extended until the end of…
COVID-19: Updated guidance on the Self-Employed Income Support Scheme (SEISS) HMRC has published further guidance on the SEISS and details of how to work out total income and trading profits. Much of the core detail discussed in our initial outline of the scheme remains consistent. However, HMRC’s guidance has been supplemented with additional clarity on: making a…
The Coronavirus Business Interruption Loan Scheme – preparing a strong application How to enhance your application for funding under the Coronavirus Business Interruption Loan Scheme (CBILS). OFFICIAL GUIDANCE: Coronavirus Business Interruption Loan Scheme Is your business eligible for CBILS? CBILS is a temporary UK lending scheme for SMEs supported by the UK government during the…
HMRC issues new guidance on Coronavirus Job Retention Scheme – new cut-off date for access to the CJRS Many more employees will now be eligible for furlough under the Coronavirus Job Retention scheme as the government has moved the payroll cut-off date to 19 March 2020. The government has announced a major change to the…
A tranche of new Coronavirus Business Interruption Loan Scheme lenders have been approved by the British Business Bank. The British Business Bank, the UK government’s economic development bank set up in 2014, has announced its approval for the Co-operative Bank, Cynergy Bank, OakNorth Bank and Starling Bank as new lenders for the Coronavirus Business Interruption…
HMRC have updated guidance on recognising genuine HMRC contact with information on survey invites about the government support schemes for workers and businesses affected by coronavirus (COVID-19). Section 1 of the guidance details the current planned contact from HMRC, section 2 gives guidance on recognising fraudulent email correspondence and section 3, details of genuine SMS…
Find out if your business is eligible for support from the new Economic Resilience Fund Further details about support from the Welsh Government’s new £500m Economic Resilience Fund has been published today. Economy Minister Ken Skates today released further information about the fund, including eligibility criteria for businesses and charities to enable them to prepare…
COVID-19: how employers can recover statutory sick pay The coronavirus statutory sick pay rebate scheme (SSPRS) will repay statutory sick pay (SSP) to employers that they pay to employees for periods of sickness starting on or after 13 March 2020. The maximum recoverable will be the SSP amounts prescribed by government (ie, at the rates…
Coronavirus Job Retention Scheme: further clarification HMRC has updated its guidance on the grants available under the Coronavirus Job Retention Scheme (CJRS), publishing further details about who and what is eligible. The HMRC update was released on 4 April and addressed: Guidance for employers – Claim for your employees’ wages through the Coronavirus Job Retention…
Improvements to CBILS: what you need to know Last week, improvements were announced to the Coronavirus Business Interruption Loan Scheme to ensure more businesses can access government support. Since the Coronavirus Business Interruption Loan Scheme (CBILS) launched less than two weeks ago, almost 1,000 facilities valued at £90.5m have been approved by lenders, but the…
COVID-19: Act fast to reinstate workers for the furlough grant Businesses wanting to reinstate workers to their payroll to receive the coronavirus job scheme grant may face complications if they delay beyond 6 April. Employers forced to make staff redundant due to the coronavirus pandemic before the government announced support measures, have been seeking clarification…
Emergency measures to support farmers during COVID-19 unveiled A series of emergency measures to support Welsh farmers during the coronavirus (COVID-19) outbreak, recognising the crucial role they play in feeding the nation, have today (1 April) been announced by Minister for Environment, Energy and Rural Affairs, Lesley Griffiths. In recognition of the challenges facing the…
Sole directors and the Coronavirus Job Retention Scheme There are over a million sole director/shareholder owner-managed limited companies in the UK who don’t qualify as self-employed individuals (although they will complete an income tax self assessment return). Typically, they take some remuneration through PAYE by way of salary, usually at a level just above the…
COVID-19: HMRC extends MTD ‘digital links’ deadline until 2021 Businesses participating in Making Tax Digital for VAT have until 1 April 2021 to meet the requirement to have ‘digital links’ within their recordkeeping in light of the coronavirus pandemic. To ease the burden on businesses during the COVID-19 crisis, HMRC has confirmed that it is…
COVID-19: Package of support for the self employed Grants of up to £2,500 per month are to be made available for the self-employed during the coronavirus pandemic, but the scheme is unlikely to be operational until June. Following measures to help businesses and employers through the coronavirus crisis, the Chancellor has announced the creation of…
Entrepreneurs’ relief – reduction in lifetime limit Prior to the Budget, there had been much speculation that entrepreneurs’ relief would be abolished. In the event it stayed – albeit with the new name of ‘Business Asset Disposal Relief’ – and a much-reduced lifetime limit. New £1 million lifetime limit The lifetime limit is reduced from…
COVID19: SSP Relaxations To help employees and businesses manage the Coronavirus outbreak, a number of relaxations have been made to the statutory sick pay (SSP) rules. They apply from 13 March 2020. Details are on the Gov.uk website. SSP payable from day one Employees will be able to benefit from SSP from the first day of…
COVID19: Business rate relief and grants To help business affected by the COVID19 pandemic, the Chancellor announced a number of measures effected through the business rates system. Business rate retail relief increased and extended At the time of the 2020 Budget, the Chancellor announced that the business rates retail discount for 2020/21 would be doubled…
Budget 2020 – rates and allowances The Chancellor, Rishi Sunak, presented his first Budget on 11 March 2020, confirming the rates and allowances applying for the 2020/21 tax year. The following key rates and allowances were announced. Full details of the rates and allowances applying for 2020/21 are available on the Gov.uk website. Income tax As…
Off-payroll working rules delayed In a surprise move, the Government have announced that the reforms to the off-payroll working rules have been delayed by one year and will now come into effect from 6 April 2021. The delay is to help businesses affected by the COVID19 pandemic. The delay will affect medium and large private sector organisations…
CORONAVIRUS: CHANCELLOR UNVEILS SELF-EMPLOYED SUPPORT SCHEME The Chancellor has announced a significant support package for self-employed people affected by the coronavirus outbreak but warned the complexity of building a new system could mean the first payments could be made in June. Speaking at the government’s daily COVID-19 briefing, Rishi Sunak announced a new Self-Employed Income Support…
THE CORONAVIRUS JOB RETENTION SCHEME: FURLOUGH GUIDANCE The following is our understanding of this policy and how this will work based on the information published so far. It should not be relied on for advice at this stage but is intended to give an indication of how the scheme will work. Key policy objectives of…
COVID-19: VAT AND SELF ASSESSMENT PAYMENT DEFERRAL The UK government is supporting businesses during the coronavirus pandemic by deferring VAT and self assessment payments for six months. Under the government’s proposals VAT payments being deferred will not now need to be made until the end of the tax year and no application is required. Returns should still…
Coronavirus – support for businesses Both the Welsh and UK Governments have announced support for businesses hit by Coronavirus: Below is a summary of the package of measures announced by the Welsh and UK Governments. For the latest detailed information on specific measures, please click on the links below: The Coronavirus Job Retention Scheme COVID-19:…
Using capital losses Where capital gains tax would be payable on a gain made on the disposal of an asset, if the disposal results in a loss, the loss is an allowable loss for capital gains tax purposes. Gains in the same tax year In the event that capital gains are made in the same…
Termination payments and employer National Insurance From 6 April 2020, employers will have to pay Class 1A National Insurance contributions on taxable termination payments in excess of the £30,000 tax-free limit. However, no contributions will be payable by employees; although employers and employees both pay Class 1 contributions on payments made on termination that count…
National Insurance contributions for 2020/21 The starting point for paying National Insurance is to increase to £9,500 for 2020/21 for employees and for Class 4 contributions payable by the self-employed. This is in line with a Government commitment to increase the starting threshold to £12,500 – the level of the personal allowance for tax purposes.…
Personal allowances – use them or lose them With the end of the 2019/20 tax year approaching, now is a good time to review your available personal allowances for 2019/20 and make sure that they are not wasted. Personal allowance For 2019/20, the personal allowance is £12,500. However, where income is more than £100,000, the…
