Archives for Company Tax

Delay in the abolition of Class 2 NIC

The government has announced that it will introduce legislation, to abolish Class 2 national insurance contributions (NIC) and to make further proposed NIC changes in 2018. The measures the legislation will implement, will now take effect one year later than previously announced, from April 2019. These measures include the abolition of Class 2 NIC paid by self employed individuals, reforms to the Class 1A NIC treatment of termination payments (the £30,000 rule) and changes to the NICs treatment of sporting testimonials. On 2 November 2017 the Government announced a one year delay to the abolition of Class 2 NICs. Class
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Employee gifts – tax free?

At this time of year some employers may wish to make small gifts to their employees. A tax exemption is available which should give employers certainty that the benefits provided are exempt and do not result in a reportable employee benefit in kind. In order for the benefit to be exempt it must satisfy the following conditions: The cost of providing the benefit does not exceed £50 per employee (or on average when gifts made to multiple employees). The benefit is not cash or a cash voucher. The employee is not entitled to the voucher as part of a contractual
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Budget 2017: Business Taxes

Making Tax Digital for Business: VAT In July 2017, the government announced significant changes to the timetable and scope of HMRC’s digital tax programme for businesses. VAT will be the first tax where taxpayers will keep digital records and report digitally to HMRC. The new rules will apply from April 2019 to all VAT registered businesses with turnover above the VAT threshold. As with electronic VAT filing at present, there will be some exemptions from Making Tax Digital for VAT. However, the exemption categories are tightly-drawn and unlikely to be applicable to the generality of VAT registered businesses. Comment Keeping
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Budget 2017: Employment Taxes

Different forms of remuneration In the Spring Budget the government stated it wished to consider how the tax system ‘could be made fairer and more coherent’. A call for evidence was subsequently published on employee expenses. The government’s aim is to better understand the use of the income tax relief for employees’ business expenses. It sought views on how employers currently deal with employee expenses, current tax rules on employee expenses and the future of employee expenses. Following the call for evidence: The government announced that the existing concessionary travel and subsistence overseas scale rates will be placed on a
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Personal credit card payments to HMRC

HMRC have advised that from 13 January 2018, personal credit card payments to HMRC cannot be accepted. HMRC have accepted credit card payments from individuals, but from 13 January 2018, this method of payment will no longer be available. HMRC’s hand has been forced due to a change in EU law, which prohibits merchants (including HMRC) from recharging credit card fees to payers. As HMRC is only allowed to accept credit card payments on the basis there is no cost to the public purse, this new law will mean HMRC cannot accept credit card payments from the date the law changes.
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Making Tax Digital for VAT

The government have issued information on how Making Tax Digital for Business (MTDfB) is expected to work for VAT once the rules are introduced in April 2019. Under the proposed rules, which have been issued subject to consultation, VAT registered businesses with turnover over the VAT registration threshold will be required to submit their VAT return digitally using software. Businesses with a turnover above the VAT threshold (currently £85,000) will have to: Keep their records digitally (for VAT purposes only) and Provide their VAT return information to HMRC through Making Tax Digital (MTD) functional compatible software. This software will either
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HMRC genuine and phishing/bogus emails and calls

HMRC have issued an update of their guidance on how to recognise genuine HMRC contact be it via email or text. HMRC also provide advice on what to do if you have received a phishing/bogus email related to HMRC, or you are not sure if it is genuine, you can read about how to report internet scams and phishing to HMRC. We are receiving concerning contacts from clients where voicemails are being left stating it is HMRC and unless a debt is going to be paid they will be sued.  The call back number given starts with the dialing code
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New timetable for Making Tax Digital

The government has announced a new timetable for Making Tax Digital for Business (MTDfB) with new dates for the introduction of this scheme. MTDfB introduces extensive changes to how taxpayers record and report income to HMRC. Unincorporated businesses, including landlords, were expected to be the first to see significant changes in the recording and submission of business transactions but the government has announced a delay to the implementation of the new rules and some exceptions for smaller businesses. The government had decided how the general principles of MTDfB will operate after receiving responses to their original ideas first published in August
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Reduction in the Dividend Allowance

To reiterate it was announced in the Budget that the Dividend Allowance will be reduced from £5,000 to £2,000 from April 2018. Dividends received by an individual are subject to special tax rates. The first £5,000 of dividends are charged to tax at 0% (the Dividend Allowance). Dividends received above the allowance are taxed at the following rates: 7.5% for basic rate taxpayers 32.5% for higher rate taxpayers 38.1% for additional rate taxpayers. Dividends within the allowance still count towards an individual’s basic or higher rate band and so may affect the rate of tax paid on dividends above the
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Making Tax Digital for Business update

Extensive changes to how taxpayers record and report income to HMRC are being introduced under a project entitled Making Tax Digital for Business (MTDfB) . MTDfB is to be introduced in stages and the government has confirmed in the Budget the deferral of some of the obligations for one year. The result of this announcement is that unincorporated businesses and unincorporated landlords with annual turnover: above the VAT threshold (currently £85,000) will need to comply with the requirements of MTDfB from the start of accounting periods which begin after 5 April 2018 at or below the VAT threshold but above £10,000
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