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This year’s Autumn Budget was presented earlier than usual, due in part to the crucial final stages of the government’s Brexit talks with the EU. Measures for businesses included a cut in business rates for small retail properties in England, together with an increase in the Annual Investment Allowance from £200,000 to £1 million. Individuals will benefit from an increase in the income tax personal allowance a year earlier than planned, in April 2019. The higher rate threshold will also increase at this time.
We’ve put together a Budget Newsletter with all the key points. We give you an overview of the announcements arising from the Chancellor’s speech, and consider how they could affect your personal and business finances.
Please click here to read our Budget Newsletter now.
You can also find more in-depth information in our app which includes fully updated ‘Budget News’. Just visit our home page for the link to download the app, or download it direct from the iTunes Store or Google Play (search for MyAccountants and then use the code ‘Liric’).
Did you catch our November newsletter – if not click here
The Chancellor’s 2017 Budget contained some important announcements and confirmed a number of changes planned for the new tax year.
There was both good and bad news for sole traders and small businesses in today’s Budget. Following this, we have put together a review which contains the latest tax and financial information, which we trust you will find useful. Please click here to download.
For more information on how the changes in the Budget may affect you, please contact us
Class 4 NICs will increase from 9% to 10% in April 2018, and then to 11% in April 2019 for those earning more than £8,060. Employees currently pay 12%. Class 2 contributions – as previously announced – will be abolished from April 2018. This will affect you if you are self-employed.
In addition, Hammond announced that the tax-free dividend allowance – introduced last year – will be reduced from £5,000 to £2,000 from April 2018. This will affect you if you trade as a Limited Company.
As plans for Making Tax Digital (MTD), continue apace, Hammond also announced that for businesses with turnover below the VAT registration threshold this will be delayed by one year to April 2019 to allow more time to prepare for the changes.
Businesses that have an annual turnover below the VAT registration threshold will have an extra year before they are required to keep records digitally and send HMRC quarterly updates.
Those businesses trading above the VAT threshold will still be required to keep digital records and send HMRC quarterly updates from April 2018.
The exemption threshold for MTD remains at £10,000.
At Liric, we are working on ensuring all our clients have the systems they will need to ensure they comply and there will be much more about this in future newsletters.
HMRC will not be issuing paper statements and payslips to self-assessment taxpayers to remind them of the 31 January 2016 filing and payment date unless the taxpayer has filed their 2014/15 tax return by 31 December 2015, and has not opted for digital only communications from HMRC.
HMRC will not be issuing paper SA reminders and payslips for taxpayers who file their 2014/15 tax returns in January 2016 or for those taxpayers who have opted for digital-only SA communications from HMRC. Payment options available without a payslip are by debit/credit card, CHAPS/BACS, direct debit or via online or telephone banking.
Payment by cheque through the post is available but only with a paying in slip. If you do not have a paying in slip you can print a payslip but this cannot be used to pay over the counter at a bank, building society or Post Office.
Further details on how to pay can be found on the HMRC website – GOV.UK at: https://www.gov.uk/pay-self-assessment-tax-bill
Following the restriction of tax relief for mortgage interest and the 3% increase in Stamp Duty Land Tax all is not doom and gloom for buy to let landlords. Following on from the consultation this summer the draft Finance Bill 2016 includes the legislation to reintroduce tax relief for the replacement of furnishings in buy to let properties from 6 April 2016.
This will apply to both furnished and unfurnished lettings and will mean that the cost of replacing items such as cookers and washing machines will again qualify for relief following the withdrawal of a concession from 6 April 2013.
Note that the alternative, and simpler, 10% wear and tear allowance will be withdrawn from 6 April 2016 for those letting properties fully furnished.
Those letting properties under the more stringent furnished holiday letting rules will continue to be able to claim the Annual Investment Allowance which provides 100% tax relief for the initial furnishing as well as renewal of furniture in holiday properties.
It’s that time of year again, Christmas. Which means the Works Christmas Do.
So we thought it would be useful to give you as employers some top tips for the occasion.
Top tips for Christmas parties:
– Employment law still applies during any events outside of the workplace. This means that a business is still at risk if any incidents do occur
– Christmas parties should be enjoyable, but don’t make attendance compulsory. Family commitments or religious reasons may preclude attendance
– Consider timing. Putting it on a Wednesday night may mean that bizarrely attendance is down on Thursday
– Invite all employees though. Even those you’ve forgotten about on maternity leave etc
– Circulate a memo reminding your employees of what constitutes acceptable non-discriminatory behaviour, and the disciplinary consequences they will face should they fail to comply
But what if you didn’t do this?
Ok so there are some risks and this is a serious issue, but is a huge policy going to help you? Maybe but also maybe not.
Sadly employees do stupid things, whether it’s at Christmas or not.
Whether they’ve read a policy or not, after 10 pints of lager and half a bottle of free wine they aren’t going to remember it and will likely do as they drunkenly want. It will need to be dealt with, but in reality you cannot legislate for every situation.
So beware – but enjoy
Download our guide to the 2015 Autumn Statement Autumn-budget-statement-2015.pdf.
Our summary offers an overview of the key business, tax and financial measures announced in the Autumn Statement which could affect you and your business. Major announcements include the reversal of cuts to tax credits, the introduction of a new 3% stamp duty surcharge for buy-to-let properties and second homes, and an extension of the doubling of small business rate relief for a further year.
For tailored advice on any of the topics covered within the Autumn Statement, and how they may have an impact on your business or personal finances, please give us a call on 01763 853633.
We offer far more than traditional tax and compliance services, and can advise on a range of strategies designed to minimise your tax bill, improve profits and maximise your personal wealth.
|I just thought i would let you know of something you can get for FREE…. You can now get free access to 170 million records at Companies House.
In line with the government’s commitment to free data, Companies House announced on 22nd June 2015 that all public digital data held on the UK register of companies is now accessible free of charge, on its new public beta search service.
This provides access to over 170 million digital records on companies and directors including financial accounts, company filings and details on directors and secretaries throughout the life of the company.
As a result, it will be easier for businesses and members of the public to research and scrutinise the activities and ownership of companies and connected individuals.
In the Summer Budget Newsletter we outlined the new rules for the taxation of dividends that will apply from 6 April 2016. Further guidance has now been published by HMRC setting out how the new rules will operate and it seems the rules don’t work as many people expected. As previously reported, there will be no 10% credit against the tax on dividends which means there will be a 7½ % increase in the rate of tax on dividends once the £5,000 dividend allowance has been used up. Currently dividends falling into the basic rate band are effectively tax free.
However the £5,000 allowance needs to be taken into consideration in determining the rate of tax on your dividends. For example if you have salary and other non- dividend income of £40,000 next year and £9,000 in dividends, the £4,000 of taxable dividends are taxed at 32.5%, not £3,000 at 7.5% then £1,000 at 32.5%. This is because the £5,000 is added to the £40,000 income pushing the taxable dividends into the higher rate band.
If you own your own company it may be beneficial to bring forward dividend payments from next year to save the additional 7½ %. However, it would be important to consider all of the tax implications of such actions so come and talk to us to discuss your options.