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Last chance to make sure your business is ready for MTD

Last chance to make sure your business is ready for MTD 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...

Can your business claim a super deduction?

Can your business claim a super deduction? 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...

End of bulk appeals for tax fines in May

End of bulk appeals for tax fines in May 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...

Where is the best place to hold your tax money?

Where is the best place to hold your tax money? 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...

Payments on account due July 31

Payments on account due July 31 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...

Use up your tax allowances early in the tax year

Use up your tax allowances early in the 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...

Spring Statement round-up

Spring Statement round-up 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...

Reclaim Married Couple’s Allowance before 5 April

Reclaim Married Couple’s Allowance before 5 April 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...

Bounce-back loans – where are we now?

Bounce-back loans – where are we now? 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...

Taxpayers get extension to self-assessment filing dates

Taxpayers get extension to self-assessment filing dates 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...

ITSA registration

ITSA registration 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...

SSP changes

SSP changes 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...

Help if you are struggling to pay your tax bill

Help if you are struggling to pay your tax bill 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...

Payments on account

Payments on account 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...

File your 2020/21 tax return by 31 January 2022

File your 2020/21 tax return by 31 January 2022 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...

Company cars and vans

Company cars and vans 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...

Seasonal gifts to employees

Seasonal gifts to employees 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...

Keeping the Christmas party tax-free

Keeping the Christmas party tax-free 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...

New MTD timetable

New MTD timetable 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...

Paying employees early at Christmas

Paying employees early at Christmas 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,...

Budget highlights

Budget highlights 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...

Tax checks for licence renewal applications

Tax checks for licence renewal applications 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...

New VAT rate for hospitality and leisure

New VAT rate for hospitality and leisure 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...

AIA transitional limit extended

AIA transitional limit extended 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...

Paying tax and National Insurance due under your PSA

Paying tax and National Insurance due under your PSA 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...

Extension of Making Tax Digital for VAT

Extension of Making Tax Digital for VAT 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...

End of the CJRS

End of the CJRS The Coronavirus Job Retention Scheme (CJRS) came to an end on 30 September 2021. The scheme has provided financial help to employers and employees during the COVID-19 pandemic, allowing employers to claim grants with which to pay furloughed and...

Plan ahead for increases in the dividend tax rates

Plan ahead for increases in the dividend tax rates As part of the Government’s funding strategy for health and social care, the dividend tax rates are to be increased from April 2022, alongside the temporary increases in National Insurance, and, from April 2023,...

Kickstart Scheme

Kickstart Scheme 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...

Get ready for the plastic packaging tax

Get ready for the plastic packaging tax 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...

Check you are paying the NMW

Check you are paying the NMW 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...

Reclaiming SSP for periods of self-isolation

Reclaiming SSP for periods of self-isolation 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...

Basis period reform

Basis period reform 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...

Back to the office

Back to the office 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...

NMW reminder for summer staff

NMW reminder for summer staff 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...

Collection of tax debts after COVID-19

Collection of tax debts after COVID-19 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...

EU e-commerce package for VAT

EU e-commerce package for VAT 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...

Reporting SEISS payments on your tax return

Reporting SEISS payments on your tax return 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...

Accessing the Government Gateway

Accessing the Government Gateway 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...

Paying CJRS grants back

Paying CJRS grants back 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...

New lower temporary SDLT threshold

New lower temporary SDLT threshold 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...

NIC relief for employers of armed forces veterans

NIC relief for employers of armed forces veterans 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...

SEISS grant 5

SEISS grant 5 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...

Claim relief for shares of negligible value

Claim relief for shares of negligible value 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,...

Claim tax relief for expenses of working from home

Claim tax relief for expenses of working from home 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...

Amending a PSA for COVID-19 benefits

Amending a PSA for COVID-19 benefits 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...

Reporting expenses and benefits for 2020/21

Reporting expenses and benefits for 2020/21 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...

Higher residential SDLT threshold extended

Higher residential SDLT threshold extended 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...

Taxation of company cars in 2021/22

Taxation of company cars in 2021/22 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...

Recovery loan scheme

Recovery loan scheme 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...

Family companies and the optimal salary for 2021/22

Family companies and the optimal salary for 2021/22 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...

Extended carry-back for losses

Extended carry-back for losses 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...

Corporation tax increase from April 2023

Corporation tax increase from April 2023 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...

New capital allowances super-deduction

New capital allowances super-deduction 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...

Further grants available under the SEISS

Further grants available under the SEISS 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...

CJRS extended until 30 September 2021

CJRS extended until 30 September 2021 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...

Thresholds and allowances frozen until April 2026

Thresholds and allowances frozen until April 2026 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...

Business interruption insurance pay-outs

Business interruption insurance pay-outs 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...

Updating PAYE codes for 2021/22

Updating PAYE codes for 2021/22 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...

Gift Aid warning

Gift Aid warning 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...

Self-assessment late payment penalty

Self-assessment late payment penalty 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...

MTD for corporation tax

MTD for corporation tax 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...

National Minimum Wage changes from 1 April 2021

National Minimum Wage changes from 1 April 2021 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...

File your tax return by 28 February

File your tax return by 28 February 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...

New COVID-19 grants for closed businesses

New COVID-19 grants for closed businesses 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...

31 January self-assessment deadline approaching

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,...

The CJRS, furloughed staff and Christmas holidays

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...

Virtual Christmas parties and tax-free gifts

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...

Furnished holiday lettings and lockdowns

Furnished holiday lettings and lockdowns 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...

Some Brexit reminders

Some Brexit reminders The Brexit transitional period comes to an end on 31 December 2020. As a result, new rules will apply 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...

Temporary AIA limit extended until 31 December 2021

Temporary AIA limit extended until 31 December 2021 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...

HMRC consult on Making Tax Digital for corporation tax

HMRC consult on Making Tax Digital for corporation tax 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...

Customs declarations from 1 January 2021

Customs declarations from 1 January 2021 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...

File your tax return by 30 December 2020

File your tax return by 30 December 2020 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...

SEISS grant increased

SEISS grant increased 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...

CJRS extended until March 2021

CJRS extended until March 2021 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...

Postponed VAT accounting

Postponed VAT accounting 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...

Job Support Scheme

Job Support Scheme 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....