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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....

More time to pay your tax bills

More time to pay your tax bills 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...

Further extension to the SEISS

Further extension to the SEISS 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...

Deadline for applying for COVID-19 finance extended

Deadline for applying for COVID-19 finance extended 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...

PAYE Settlement Agreement reminder

PAYE Settlement Agreement reminder 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...

Annual investment allowance

Annual investment allowance 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...

Off-payroll working back on the horizon

Off-payroll working back on the horizon 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...

Benefit-in-kind charge on electric vans

Benefit-in-kind charge on electric vans 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...

Statutory redundancy pay and furloughed employees

Statutory redundancy pay and furloughed employees 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...

Correcting claims under the CJRS

Correcting claims under the CJRS 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...

Final SEISS grant

Final SEISS grant 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...

Making Tax Digital – the next steps

Making Tax Digital – the next steps 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...

Bonus for employers who retain furloughed staff

Bonus for employers who retain furloughed staff 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...

New rules for claims under the CJRS

New rules for claims under the CJRS 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...

Temporary increase in residential SDLT threshold

Temporary increase in residential SDLT threshold 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...

Reduced rate of VAT for hospitality sector

Reduced rate of VAT for hospitality sector 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...

NIC implications of COVID-19 support payments

NIC implications of COVID-19 support payments 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...

SEISS extended

SEISS extended 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...

Changes to trading activities as a result of COVID-19

Changes to trading activities as a result of COVID-19 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...

Flexible furloughing

Flexible furloughing 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,...

Option to defer July self-assessment payment on account

Option to defer July self-assessment payment on account 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...

Expenses and Benefits Returns for 2019/20

Expenses and Benefits Returns for 2019/20 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...

Coronavirus Job Retention Scheme extended

Coronavirus Job Retention Scheme extended 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...

Claim SSP for Coronavirus-related absences

Claim SSP for Coronavirus-related absences 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...

COVID-19 self-employed scheme

COVID-19 self-employed scheme 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...

Making Tax Digital – soft landing extension

Making Tax Digital – soft landing extension 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...

Optimal salary for 2020/21

Optimal salary for 2020/21 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...

Supporting employees working from home

Supporting employees working from home 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...

Coronavirus Job Retention Scheme

Coronavirus Job Retention Scheme 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...

COVID-19: SSP Relaxations

COVID-19: 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...

COVID-19: Business rate relief and grants

COVID-19: Business rate relief and grants To help business affected by the COVID-19 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,...

Budget 2020 – rates and allowances

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...

Off-payroll working rules delayed

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...

Using capital losses

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...

Termination payments and employer National Insurance

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...

National Insurance contributions for 2020/21

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...

Personal allowances – use them or lose them

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...

Reducing your payments on account

Reducing your payments on account Under the self-assessment system, a taxpayer is required to make payments on account of their tax liability where their income tax and Class 4 National Insurance bill for the previous tax year was £1,000 or more, unless at least...

Loan charge – changes announced

Loan charge – changes announced The 2019 loan charge applied to loans made through a disguised remuneration loan scheme on or after 6 April 1999 which remained outstanding on 5 April 2019 and in respect of which settlement had not been reached with HMRC by that...

Determining worker status using HMRC’s CEST tool

Determining worker status using HMRC’s CEST tool From 6 April 2020 the off-payroll working rules are extended. The impact of the new rules was discussed in the December 2019 Newswire. Under the new rules, medium and large private sector organisations engaging...

Changes to Property Taxation – 2017 to 2020

Changes to Property Taxation – 2017 to 2020 2017 Income Tax – Restriction of finance costs for individual landlords In his 2015 post-election summer Budget, George Osborne informed residential landlords that from April 2017 their ability to claim higher...

Tax Return Tips

Tax Return Tips The 2018/19 self-assessment tax return must be filed online by midnight on 31 January 2020 if a late filing penalty is to be avoided. What can you do to help ensure this deadline is not missed? Help us to help you The tax return season is a very busy...