From April 2019 you can no longer use the HMRC portal to file your VAT return and it must be filed through approved HMRC software. This means that all your records must be input onto the software not using Excel or a book and HMRC will receive all your records in real time. Please contact us for further information and how MTD will affect you.
Remember to pay your personal self assessment tax by the 31st January 2019. But you do actually have 30 days from this date to pay until you receive a 5% surcharge of tax owed for non payment. The easiest way to pay is to go to www.hmrc.gov.uk and follow the pay self assessment tab, making sure you put your tax reference into the payment reference box.
National Insurance (NI) types. If you are PAYE you pay Class 1 NI at 12% of earnings between £168-£892 per week. If you are self-employed you pay Class 2 NI at £2.95 per week if earning over £6,205 as well as Class 4 NI at 9% on profits over £8,424 up to profits of £46,350, when it goes to 2%. If you are PAYE and self employed then you pay both but HMRC do contact you if you have [...]
Auto enrolment Pensions. Please note that from April 2019 auto enrolment pension contributions will be increasing again. The employer contribution is raising from 2% to 3% and the employee contribution from 3% to 5%, thus the overall minimum contribution is raising from 5% to 8%.
Autumn Budget 2018. Some main points from yesterdays budget ; The personal tax allowance is rising to £12,500 from April 2019 (a year earlier than promised). The basic rate band is also increasing to £37,500 from April 2019, thus you will not pay higher rate tax until your earnings exceed £50,000 Despite calls for abolishment, Entrepreneurs Relief, reducing the tax on disposal of business (assets) to 10%, remains in place The Chancellor has tightened the rules on PSCs (Personal Service Companies) to [...]
Tax saving tips. Remember to pay your spouse if they are helping with your business, especially if they are not using their tax allowances or you are in the upper rate of tax. Everyone can earn £11,850 tax free this year. If you are a limited company always use your company pension scheme. Not only is this a tax efficient way of saving, the government also contribute. If you are working from home, always claim a nominal amount of “use of home” for [...]
Now we are in the middle of tax year 18/19, it is a good time to remind you of the major tax changes for this year affecting all our clients. The tax free allowance for everyone has increased from £11,500 to £11,850. The tax free dividend allowance has reduced from £5,000 to £2,000. The self employed Nation Insurance threshold has risen from £6025 to £6205, with weekly contributions rising from £2.85 to £2.95. Finally the Capital Gains Tax Allowance [...]
Buy to Let (BTL) tax changes. From 2017/18 tax year the way you can claim mortgage interest against your BTL income changes. Previously, the interest was deducted from your rental income and the profit added to your overall income and taxed at your prevailing rate. Now you will simply receive a 20% tax credit for your mortgage interest that will be deducted from your tax bill. This means there is no difference if you are a basic rate tax payer, [...]
Dividends. Remember that dividends can only be paid from your company profits and no more frequently than monthly. These payments do not effect your Corporation tax but they will effect your personal tax. For 2017/18 you received the first £5,000 of dividends tax free, for this tax year it is reduced to £2,000. After that you are personally taxed at 7.5% in your personal tax return for basic rate tax payers and then 32.5% for higher rate payers and [...]
Employee tax relief – remember that if either you or your employees pay for business expenses personally and are not reimbursed, they can claim personal tax relief. The allowable expenses are varied from travel costs to protective clothing. You either claim through your personal tax return or if you are not in self assessment via the HMRC website at www.hmrc.gov.uk