If you are an employer and employee staff over 22 years old or earning over £10,000 you must offer them a company pension scheme, even if they wish to opt out. If you do not set up a pension scheme the regulator may fine you up to £5,000 per company. Please note that this is the responsibility to set up, enrol and reenrol, of the director not the accountant.
If your husband or wife does not use their £12,500 tax allowance then they may transfer £1250 of their allowance to their basic rate paying partner, reducing their tax bill by up to £250. If you wish to apply then the person with the lower income should go to www.hmrc.gov.uk/marriage-allowance/how-to-apply. This may also be backdated to 2015.
Many clients are set up to pay the minimum tax and National Insurance, by paying a low wage and a monthly dividend. Whilst this is the most tax efficient way to pay yourself, if this is continued for many years there is a possibility you will under pay National Insurance and possibly not receive a full pension. If this is the case you can voluntarily top up your National Insurance contributions. Please check your NI contributions are ok by [...]
From April 2020 HMRC are changing the way rule IR35 is viewed, which determines if you are an employee or sub contractor. The responsibility is going to now be down to the contractor or employer to decide the correct decision. Obviously, tax wise, it is better for someone to be a sub contractor, but the rules are tightening. After discussions with HMRC and governing accounting bodies, it seems that the all important criteria is if an individual has the [...]
Normally if you sell your business the proceeds are split between Sale of Assets and Goodwill. The Profit or Loss on the sale of the assets will depend upon the sale and the value in your accounts, but the remaining money received will be for Goodwill and you will have to personally declare this for Capital Gains Tax (CGT). CGT is at 10% for basic rate tax payers and 20% for upper rate tax payers, although you may qualify [...]
Tax free childcare replaced the old voucher system in October 2018. Now if you have children under 12, you apply direct to HMRC rather than through your employer, to receive for free up to 20 % of your childcare costs up to £2,000. To check your entitlement please visit www.tax-service.gov.uk/childcare-calc.
If you have a student loan you must inform your employer or your Accountants if you are self employed or a director of your own company. If you earn over £364 per week on plan 1 (loan taken before 2012) or £494 per week on plan 2 (loan taken 2012 onwards) then you must pay 9% of your income above this threshold towards your loan repayments. The student loan is written off when you either reach age 60 or [...]
Stamp duty is the tax paid by the purchaser when buying a property, at the time of purchase. Currently for properties purchased up to £125,000 the rate is 0%, from £125,000-£250,000 2%, £250,000-£925,000 5%, £925,000-£1.5million 10% and above this at 12%. There is a discount for first time buyers where they pay 0% up to £300,000 and then only 5% from £300,000-£500,000.
HMRC allows a certain amount of daily subsistence for tax relief if working away from your usual place of work. If you are travelling up to 5 hours then it is £5 per day, if up to 10 hours then £10 and if over then £25 per day. Remember to add these to your tax return expenses for maximum tax relief.