Clarke Nicklin Business Update I hope everyone is still keeping safe and well. We had a flurry of activity in terms of governmental announcements at the start of lockdown in relation to businesses and support packages to businesses, with that having settled down for a period of time through the main part of lockdown. It certainly feels we are now in a very different phase with regard to businesses and factors both having an immediate implication, and also businesses needing to assess for the...

As of yesterday, small businesses and employers who have paid statutory sick pay (SSP) to staff who have taken coronavirus-related leave can now claim the money back. • Applications were announced by Chancellor Rishi Sunak and officially opened on 26th May.• If you have fewer than 250 members of staff, you can apply to recover the costs of paying COVID-19 related SSP.• The repayment covers up to two weeks of SSP from either 13th March 2020 (if an employee had symptoms or was self-isolating...

Clarke Nicklin Chartered Accountants are thrilled to announce the promotion of Senior Manager, Gareth Jones, to Director as part of Clarke Nicklin’s further strengthening of the senior team. Gareth joined the business in 2005 having just graduated with a first class degree in Finance and Accounting and went on to achieve his FCCA qualification. Since joining the firm Gareth has been an instrumental part of the team, advising and supporting clients to achieve their goals and objectives, and moving...

I hope everyone is keeping safe and well. We are edging closer to the Government issuing guidance over the coming weekend on plans for the easing of Lockdown provisions. My expectation is that this will involve a staged easing, with businesses who can continue to operate sufficiently using mainly working from home provisions will be asked to continue to do that, and provisions for businesses to maintain a certain level of social distancing within their staff base. There will be many businesses wanting...

The VAT registration threshold has been frozen at £85,000 until at least 31 March 2022. This may bring more businesses into the VAT fold if they increase their prices with the rate of inflation.This threshold can be a harsh cliff edge, as once VATable turnover exceeds it the business must charge VAT on all eligible sales. It must also keep its VAT records in a digital format and submit its VAT returns using MTD-compatible software.For your UK sales, you must check the cumulative total of your...

Events don’t always turn out as expected. For example, you may need to wait for a later profit or loss to arise before you can judge whether it’s right to elect to change the tax treatment of an earlier transaction. This is why the law allows you extra time, after you have submitted your tax return, to submit a tax election or claim. The elections you may need to make by 31 January 2021 for the 2018/19 tax year include: to set trading losses against your other income to average the profits made...

If you are considering acquiring a new company car, take account of the changing tax incentives for electrics.The taxable benefit for having an electric company car is currently calculated at 16% of its list price when new, but from 6 April 2020 the taxable benefit for driving an electric company car will drop to 0% of its list price. However, this zero-rate is only due to last for one tax year: 2020/21, after which the taxable benefit will be increased to 1% of list price, and 2% for...

Companies that invent new production methods or products can claim enhanced tax relief for the Research and Development (R&D) costs. Small and medium-sized companies can claim 230% of qualifying R&D costs, and a 14.5% payable tax credit if this extra deduction results in a loss!This is a very attractive relief and it’s easy to claim. You can ask HMRC for an advance assurance that your company, and its R&D projects, will meet the requirements for R&D tax relief. We can help you do this.The main...

New 100% government backed loans for small businesses Businesses will be able to borrow between £2,000 and £50,000 and access the cash within days. Loans will be interest free for the first 12 months, and businesses can apply online through a short and simple form.Small businesses will benefit from a new fast-track finance scheme providing loans with a 100% government-backed guarantee for lenders, to help bolster the existing package of support available to the smallest businesses affected by the...

I hope everyone is keeping safe and well. We are working hard at Clarke Nicklin to help all our clients with a wide variety of matters linked to the Pandemic and lockdown. The Coronavirus Job Retention Scheme and the Coronavirus Business Interruption Loan Scheme are two areas of the support measures which are a key focus for many clients currently. So the information below may be helpful in relation to some common matters we are dealing with and queries arising. Coronavirus Job Retention...

We are in the process of preparing for the required filings for Job Retention Scheme claims to HMRC and ensuring we are in a position to assist you with this. In addition, even if the Job Retention Scheme isn’t relevant for you, this is useful to make sure everything is in place so that we have full access to HMRC payroll data so we can assist you both now and in the future with any PAYE queries. We note that currently we do not have online access to your PAYE records with HMRC as your agents. We...

I hope you are all keeping safe and well. We are all awaiting a Government update on the view of the position regarding lock down, although I am sure the vast majority of you are the same as me in thinking we wont see the current position change significantly for at least a few weeks to come. Things are starting to move on in relation to the Governments support measures, although further details are still to be provided in certain areas. An update on what we are seeing and aware of with the...

Update for Our Payroll Clients We are conscious that from the many queries received by our Partners, Managers and payroll staff, understandably the Job Retention Scheme has become a key factor for many of our clients in implementing measures to deal with the very significant affects of the lock down provisions in the fight against the Coronavirus. I therefore thought it was worth a summary as to how we are dealing with this area for you, and how we would work with you in order to ensure we can...

Job Retention Scheme – Some Practical Points Hopefully you have all received the previous updates sent out on the Job Retention Scheme when information on the scheme was published or being updated, or to provide some clarification when appropriate. We seem to be in a position at the moment whereby the basis of the scheme and the expectations on how it works are, for now, potentially as much as we are likely to get until HMRC have set up or close to opening up their portal system. HMRC have...

If you provide your personal services through your own company to large or medium-sized organisations, the way you are taxed may change for payments from 6 April 2020, due to the off-payroll working rules.Where your final customer is not small (it is large or medium-sized), it must determine whether the relationship with you is a deemed employment. It may do this using the HMRC online tool called “CEST”. Your customer may ask you to provide information to feed into the CEST tool before April, to...

Where an individual receives a benefit from their employer they can avoid being taxed on it if they ‘make good’ the value of benefit by reimbursing the employer. There are strict time limits for doing this.All reimbursements of taxable nonpayrolled benefits for 2019/20 must be made by 6 July 2020, which aligns with the date for submitting the forms P11D.The dates for making good on payrolled benefits-in-kind provided in 2019/20 are:• 1 June 2020 for the value of road fuel used• 5 April 2020...

You can save for retirement in a number of ways. The traditional route is via a pension scheme, but you could also use an ISA.Savers aged under 40 can open a Lifetime ISA and contribute up to £4,000 per year, which attracts a 25% bonus from the Government. This bonus is withdrawn if the savings are accessed other than to be used as a deposit for the saver’s first home, on diagnosis of a terminal illness, or from age 60 onwards.The Lifetime ISA savings are counted as part of the annual ISA...

Individuals who reach State Pension Age (SPA) on or after 6 April 2016 need to have accrued 35 complete years of National Insurance Contributions (NIC) to receive the full state pension. To receive any UK state retirement pension, you need at least ten complete NIC years.You can check how much state pension you are due to receive through your personal tax account on gov.uk. We can help you with this.It is possible to plug gaps in your NIC record by paying voluntary Class 2 or Class 3 NIC. This...

There have been no updates of any note issued by the Government which would affect clients over the last few days. We have heard, however, that whilst not officially announced, HMRC have apparently indicated that, Company Directors can be furloughed even though they may still be carrying on with statutory duties as Directors. This accords with indications given in previous updates, and seems to accord with the intimations within the Government information published. Note, however, this has not...

Over the weekend, there have not been any further provisions or detail provided affecting businesses and individual finances, and so for todays update, a summary of some considerations Directors may be faced with is provided. Clearly there are many areas Directors and business owners are having to assess and consider, without necessarily a clear picture of how to proceed because of the uncertainty facing many businesses. Click here for summary of considerations We are here to help, advise and...

Yesterday evening the Chancellor announced the expected and unprecedented provisions to support the self-employed through the main period of the effects of the Coronavirus Pandemic. The intention of the new provisions are to provide some level of equalisation between employees covered by the Job Retention Scheme and the self-employed. This move and the measures provided have to be welcomed as a major move to support the vast majority of self- employed individuals through the devastating...

I hope everyone received the detailed Q&A summary for the Job Retention Scheme yesterday, which still remains a key provision of most interest from the government measures introduced. If you didn’t receive this, please contact us so that can be sent on. As the summary showed, and as we have been discussing with many clients, the details on the working of this scheme are still not fully clear, and so further details will be provided when more detail is released. The cashflow effects of paying...

Coronavirus:Support for employers (as at 24 March 2020) Q: What support has the UK government announced for employers / employees? • On Friday 20 March 2020, the UK government announced a range of measures to help employers and employees as a result of the COVID-19 pandemic and its effect on normal working practices. The aim of the measures is to deal with the expected hardship that employees will suffer and also help businesses retain a workforce that it can call upon when business picks up...

I hope those of you who can have some small level of normal working at home are settling into it, and for others that a certain level of operation that can continue. We are very aware that the business closure list has affected a great many of you, either directly or indirectly through your customer or even supply chain being affected, and we are continuing to constantly monitor announcements for further information that we can immediately assess and get out to you. We are still awaiting...

"As you will have seen already, as a firm we are ensuring we are providing daily updates to clients with regard to matters which may affect you and your business as a result of the COVID-19 (coronavirus) pandemic. Should key matters change or further clarification be provided by the Government on support measures for businesses and individuals during the day, we will send out an immediate update to you as well. Once again, as has been reiterated in all communications sent out, we are here to...

We are conscious that many businesses and individuals could be affected by the situation, and we want to ensure every client knows that they should contact us if they have concerns over their business, or want to obtain further information on the provisions being rolled out. There are also various ways we can help our clients in these unprecedented times, including assisting with assessing your cost base, looking at breakeven analysis, and assisting with the preparation of forecasts to...

Covid-19 – Emergency measures announcedIn the last few days, the Government has made major announcements about help for small businesses and individuals affected by coronavirus. Below is a summary of the significant points, although details are awaited as to how some of these schemes may be accessed. The following measures were announced in the Budget and have not (to date) been updated. o Statutory Sick Pay (SSP) to be paid from the first day of absence, not the fourth, where people have the...

  As the 2020 Budget was revealed yesterday, here are some important snippets from what was decided...  Pensions- Call for evidence on pension tax administration: those earning around or below the level of the personal allowance and saving into a pension may benefit from a top-up on their pension savings equivalent to the basic rate of tax, even if they pay no tax. This depends on how your pension scheme administers tax relief. - Lifetime allowance for pensions: the maximum amount someone can...

If you use your own car for a business journey, perhaps to travel to a customer, you can claim mileage expenses for that journey. Many employers pay the full taxfree amount of 45p per mile, which drops to 25p for miles in excess of 10,000 in one tax year. If your employer doesn’t pay the full rate, you can claim tax relief on the shortfall, either on your tax return or on form P87. You need to submit your claim within four years of the end of the tax year in which you made the business...

On 6 April 2020 capital gains tax (CGT) on property sales will be subject to some new rules which may have a significant effect on the amount of tax you pay and the date you have to pay it. Contrary to popular belief, the profit you make when you sell your home, or a former home, is not automatically exempt from CGT. The tax exemption only applies to gains that relate to periods in which you lived in the property as your main home. However, it can be extended to certain periods when you were not...

Most employees, with very limited exceptions, must be paid at least the National Minimum Wage (NMW) or the National Living Wage (NLW). These hourly rates vary according to the age of the worker, so it’s crucial to keep a sharp eye on the birthdays of your younger workers to ensure they are paid at the right rate for their age band. The second trap you can fall into is to ignore some of the hours worked. All overtime hours, time spent training or standing in line for security checks, must be...

The Conservative Government now has a healthy majority which will allow it to change the tax law as it wishes, with little effective opposition. The tax and economic changes to be announced in the Budget Statement on 11 March 2020 could be dramatic.For example, the Conservative Party manifesto stated that there would be a review and reform of Capital Gains Tax Entrepreneurs’ Relief, so we cannot count on that relief surviving into the next tax year: 2020/21. We already know the Government...

The Clarke Nicklin team continues to grow as Alice Atkinson, recent graduate from Manchester Metropolitan University, was appointed as Marketing Executive on 02 of March to support Marketing Manager, Laura Frost. Alice’s role will involve duties such as creating content and updating social media, as well as supporting Laura with Clarke Nicklin’s ongoing planning and organisation of the annual Stockport Business Awards. When asked about starting her new role, Alice responded: “I was delighted when I...

From the 06 April 2020 there will be some important changes to employment taxes. Those who will be affected are: • Contractors – working through an intermediary, eg. Your own limited company (often known as personal service company (PSC) • Those who provide services to public sector organisations or medium or large sized organisations (Turnover of more than £10.2m, a balance sheet of £5.1m and/or more than 50 employees) Any medium and large sized organisation outside the public sector will, from...

With 2020 now in full swing, Clarke Nicklin’s Financial Planning Partner, Scott Herbert, takes stock of his 30 year career, of which he celebrates 25 years as a Financial Planner and shares some words of wisdom... “How different things were in 1995 when I was first appointed as a Representative of Refuge Assurance, now The Royal London. My first Financial Advisory role involved not only providing financial advice, but also the collection of the monthly contributions from clients houses in...

It takes a lot of planning to start a new business from scratch. You may have to pay up front for some goods and services before you form the company to trade from. Once your company is VAT registered you can claim back VAT incurred on those pre-incorporation costs, if there is a direct link between the costs and the future sales made by the company. But there are four other conditions to be aware of: • Any goods acquired either to sell or use in the business must have been purchased no more than...

Selling electronic services, such as ebooks to non-business customers in other EU countries, can cause complications for VAT. The rule for e-services is that you should account for VAT at the rate due where your customer is based. The rate of VAT due on digital publications has been reduced in many EU countries this year, so check out the appropriate VAT rates published on gov.uk. You should report and pay the VAT charged through the VAT MOSS system accessed through HMRC’s online VAT service....

To help your employees get to work, you could subsidise their travel on a local public bus service, lay on a works bus, or provide a cycle to work scheme. The cycling option not only keeps your workers fit, but it allows them to acquire a desirable bike, even one with a super carbon fibre frame. The employer buys the bicycles and associated safety equipment to lend to employees; alternatively, it contracts with a specialist bicycle hire firm which provides the bikes directly to the employees....

Have you dabbled in cryptoassets such as Bitcoin and Litecoin? Buying and selling amounts of any cryptoasset is treated just like dealing in shares or bonds, so if you make a large gain you need to declare that on your tax return. A gain or loss is made whenever a cryptoasset is exchanged for another one, or given away, or surrendered for payment made in a legal currency, such as US dollars or pounds sterling. Transactions in cryptoassets made by UK-resident taxpayers must be calculated and...

For years you have been able to claim tax relief for the cost of equipment installed within or on buildings, such as shop fittings, but not for the cost of the building itself. That changed from 29 October 2018. You can now claim a Structures and Buildings Allowance (SBA), which is equal to 2% of the cost of acquiring or constructing a commercial building that is used for your business. You must incur the costs on or after 29 October 2018, and any construction contract must have been signed on...

For many employers, the aggravation of setting up auto-enrolment of staff into a workplace pension was over years ago, but it’s not a task that can be done once and forgotten. All employees who opted out of the workplace pension must be re-enrolled in that pension after three years. You do this by writing to each staff member who should be re-enrolled within six weeks of the re-enrolment date. You choose your own re-enrolment date, but it must fall within a six-month time frame based on the...

When non-resident owners sell UK land or property (of any type), they must pay any Capital Gains Tax (CGT) within 30 days of the completion date of the sale, and submit an online report to HMRC by the same date. This 30-day payment deadline is being rolled out to all UK owners of residential property for sales made on or after 6 April 2020. From that date, if you make a gain on selling a home, any CGT due will have to be paid in full within 30 days. You will need to estimate whether or not you...

Living overseas and managing a let property in the UK is never easy, but HMRC has just made the task a little more difficult by sending disturbing letters to overseas landlords and to their tenants. The letters are targeted at landlords who hold the property through a corporate structure or a trust. HMRC has been reminding the landlord that it may need to pay the Annual Tax on Enveloped Dwellings (ATED) for periods when the property was not commercially let. We can help you check if the ATED is...

Open Banking has now been introduced and will focus on how banks handle your financial information, this means the connection between your bank and your accounting software may change. With Open Banking, you can choose who gets access to your data. You can grant permission (or withdraw it) at any time. What you need to do: These new feeds are now live, you’ll see a banner on the Banking page and if you’re the Master Admin you’ll get an email explaining the steps you need to take to update your bank...

For over 20 years the government has viewed independent contractors as tax avoiders if they work through their own Personal Service Company (PSC). This is why the IR35 rules were put in place – to get the contractor to pay approximately the same tax and NIC as an employee – if they work under conditions identical to the employees of their customer (the engager). In truth, the IR35 rules are frequently ignored, as in the private sector it has been up to contractors to apply the rules to...

Many businesses start slowly. At first there are a few occasional sales, and only after the individual has convinced themselves they can effectively deliver the product or service will the entrepreneur enthusiastically launch their business. You should tell HMRC about the start of your new business within six months of the end of the tax year in which it started. To do this you need to decide exactly when the new business commenced. Is it when the first sale was made, or was it much later when a...

Leaving the EU without an agreement in place (no-deal Brexit) is going to create some VAT challenges for businesses which import goods. Currently, import VAT is payable on goods imported from non-EU countries, and that has to be paid up-front. This import VAT would also have to be paid up-front on any goods coming in from EU countries after Brexit, unless other arrangements are put in place. The Government is proposing that, immediately following a no-deal Brexit, all import VAT will be paid...

Where individuals don’t submit an annual tax return, HMRC reconciles the tax which has been deducted from their pay or pension under PAYE with the total tax which should have been paid for the year. This reconciliation for the tax year 2018/19 takes place between June and November 2019. Where there is a discrepancy (under or over), HMRC will issue a tax computation on a form P800, or it may issue a form PA302, which will ask for tax to be paid.If you receive either type of tax statement, check the...

When you order goods online you don’t expect to pay any additional taxes when they are delivered. This is currently the case for goods ordered from a supplier in the UK or the EU. However, if you order goods from outside the EU you may receive a notice saying you must pay the import VAT before the goods can be delivered. If the supplier has already charged you the import VAT, you should not have to pay it twice. If the UK leaves the EU without other arrangements in place (no-deal Brexit),...

The Government is urging businesses to prepare for changes to customs, excise and VAT procedures when the UK leaves the EU. This is expected to happen at 11pm on 31 October 2019, but there could be a further delay until 31 January 2020. If there are no arrangements in place to temporarily keep the UK within the customs union (no-deal Brexit), import and export procedures will change immediately. Goods that travel over international borders will need to clear customs twice: 1. when the goods...

We are living in a state of unprecedented uncertainty. We don’t know if the UK will leave the EU on 31 October 2019 or not, although at the time of writing the current Prime Minister insists that this is the immoveable Brexit date. There may also be a general election before the year is out. As a business it is sensible to prepare for all likely outcomes, so gearing up for Brexit can no longer be put off. This newsletter contains some advice about what you need to do if you are an importer or...

Under the Making Tax Digital (MTD) rules, businesses must use software to submit their VAT returns unless their annual turnover is less than £85,000. If you have acquired new accounting software to comply with MTD for VAT, it’s worth checking whether it’s been set up to reflect the circumstances of your business. For example: • Have the opening balances for debtors and creditors been correctly entered?• Does the software recognise the use of the cash accounting scheme?• Is the software using the...

If you don’t submit your VAT return on time, or fail to pay the VAT due on time, HMRC will put your business on the fiscal naughty step. HMRC should tell you that your business is on its watch list by sending you a Surcharge Liability Notice (SLN), and a help letter if this is your first offence. If you repeatedly file VAT returns late or pay VAT late, the SLNs will carry on arriving and penalties will be charged. These start at 2% of the late-paid VAT (minimum of £400), and the percentage...

There are two valid reasons to cancel your VAT registration: • you have ceased trading and have no intention of making future sales• your sales in the next 12 months are expected to be less than £83,000 If your turnover for the last 12 months has been above the VAT registration threshold of £85,000, you will be required to submit VAT returns for periods starting on or after 1 April 2019 using MTD compatible software, until and unless you cancel your VAT registration. Where you are winding down your...

VAT registered businesses who need to file VAT returns under the Making Tax Digital (MTD) rules, also need to keep all of their VAT records in a digital format. This can be in a spreadsheet or in accounting software. You don’t have to take a picture of every purchase receipt, but you do need to record these three data points: • Date of the purchase• Net value of the purchase• Amount of VAT to be reclaimed Where you buy a lot of items from a supplier, you can record the totals from the supplier as a...

If you provide your personal services through your own company you may be familiar with the IR35 rules, which have been around for nearly 20 years. Those rules are designed to discourage avoidance of PAYE and NIC by organisations who engage workers through personal service companies or other intermediaries, rather than taking them on to the payroll. Who makes the decision about whether the worker is inside or outside the IR35 rules is changing. For private sector contracts, the worker...

Do you use the new HMRC starter checklist when taking on new employees? This form was updated in April 2019, and you should ask all new employees to complete it even if the individual presents you with a completed form P45. Page 1 of the starter checklist asks the new employee to tick a box next to statements summarised as: A. this is my first job since claiming state benefitsB. this is my only jobC. this is second concurrent job or pension. If all choices are left blank, you should choose...

Your employer should have sent you a P60 certificate for 2018/19 by now. This shows your income from that employer in the tax year to 5 April 2019 and the total amount of tax deducted. If you also received taxable benefits in that year, such as a company car, you should receive a form P11D detailing the value of those benefits. You will need both of those documents to complete your tax return for 2018/19, which must be submitted online by 31 January 2020, or by 31 October 2019 if you send in a...

Occasional treats for employees can be provided as tax-free trivial benefits if four conditions are met: 1. the treat is not cash or a voucher that can be exchanged for cash2. the cost of providing each treat doesn’t exceed £50 per employee3. the employee is not entitled to receive it as part of any contractual obligation4. it’s not provided in recognition of particular services performed by the employee as part of their employment duties. Say the employer promises to provide bacon rolls to...

A popular daytime TV programme follows people who renovate residential properties for a profit, but it rarely spells out the tax implications for those entrepreneurs.If the property development business is operated as a sole trader, or a partnership, the profits made on selling the properties are subject to Income Tax at rates of up to 45% (46% in Scotland) plus Class 4 NIC. Alternatively, if the renovated properties are held to generate rental income, the business is treated as property...

If you are planning to sell your main home, a holiday home, or an investment property, you need to be aware of the rule changes around the corner.When you sell your own home the gain is tax-free for the periods you lived in the property. If you move out before the property is sold, the gain for that final empty period is also tax-free, as long as that is no longer than 18 months. For sales from 6 April 2020, that final tax-exempt period will be limited to nine months, with an exception for...

Married couples tend to pool their resources and share fiscal burdens, but the UK tax system treats every individual as an independent person. This can lead to families paying more tax overall. Where one person earns the majority of the family income, he or she may pay more tax than if both individuals each earned approximately half of the same total, and hence use their full personal allowance and basic rate bands. Such inequality can be eased by the lower earner transferring 10% of their...

When you cash in a life assurance policy or bond, the taxable amount you receive is treated as the highest slice of your income. The taxable portion won’t be the full proceeds, but it can increase your marginal tax rate so you pay more tax in one year than you would have if you’d made regular withdrawals over the life of the bond. Top-slicing relief attempts to put you in the position you would have been in, had the lump sum been paid in equal amounts in each year of the bond’s life. It...

People who complete a Self-assessment tax return and owe more than £1,000 of tax, generally have to make two payments on account of tax due for the 2018/19 year, by 31 January 2019 and 31 July 2019. Those on account bills are based on the total amount of tax calculated as payable for 2017/18 in the tax return submitted by 31 January 2019. The HMRC computer should send taxpayers demands for those on account payments in good time to allow you to find the money before January and July 2019, but...

But forgiveness is not the HMRC way. Taxpayers are expected to get their tax returns right first time, and to diligently preserve all records relevant to their tax affairs for at least six years. However, HMRC has been shown to make systematic mistakes in tax computations, to provide incomplete information to taxpayers, and to have a lower standard of record retention than the courts would normally expect. Examples of all these HMRC short comings are included in this newsletter. If you feel...

There are three ways to reduce the tax payable by an employee or director who is provided with a company car: choose electric or hybrid, a ‘clean’ diesel, or take a van. Electric and hybrid cars with CO2 emissions of up to 50g/km currently attract a taxable benefit of 16% of their list price, which doesn’t encourage companies to buy the more expensive electric models. However, from 6 April 2020 the taxable benefit of having a purely electric car will be 0% of its list price. This is scheduled to...

A business must register for VAT when its turnover for the last 12 months exceeds £85,000. It must also look forward and judge if its turnover in the next 30 days alone will exceed £85,000. This threshold has been frozen since 1 April 2017, and it will remain at that level until at least 1 April 2022. This means that more businesses will be drawn into the VAT net simply by increasing their prices by inflation every year. If you don’t want to register for VAT, you either have to keep your total...

When you sell some or all of the shares in your company, you should expect to pay Capital Gains Tax (CGT) on any profits you make. This tax is normally charged at 20% for higher rate taxpayers, but Entrepreneurs’ Relief can reduce the CGT payable to 10%. To qualify for Entrepreneurs’ Relief you need to be a director or employee of the company and own at least 5% of the ordinary share capital and the related voting rights. New additional conditions require the investor to have a right to...

The Making Tax Digital (MTD) regulations came into force for periods starting from 1 April 2019 for most businesses which are required to be VAT registered because their annual turnover is £85,000 or more. They must keep their VAT records in a digital format and send VAT returns directly from MTD-compliant software to HMRC.If you use accounting software which automatically sends your VAT return to HMRC, you are 90% ready for the MTD regime. Ask your software provider when you will receive the...

If you allow your staff to pick a tax-free benefit, such as a parking space near work, a bicycle, or employer pension contributions, you would think that everyone would be happy. But where the employees have given up some of their salary to receive the benefit, some may be taxed on the benefit provided and others won’t. This is because of the tricky rules called optional remuneration arrangements (OpRA). These broadly impose tax on the employee according to the amount of salary sacrificed rather...