Blogs for March 2015 Accounting, PAYE & Taxation in Swindon, with Useful Websites
We are extremely proud to have based our accountancy business in Swindon town
and celebrate our 10th anniversary in Gorse Hill on 3.5.2015.
Headline 2015 budget announcements for businesses include:
Corporation tax to fall to 20% from April 2015;
Annual paper tax returns to be replaced with online accounts;
Fundamental review of business rates;
Increases in the minimum wage, including a 57 pence per hour rise for apprentices;
The abolition of Class 2 National Insurance contributions for the self-employed;
A commitment to raise the Annual Investment Allowance;
Fuel duty to be frozen and September’s planned increase scrapped.
Taxpayers personal allowance £10600
Transferable married allowance £1060 based upon application
Self employed can make fixed rate deduction based on business hours working at home e.g. 25 or more hours £10pm (£120pa) ; 51 or more hours £18pm (£216pa) 101> £26pm (£312pa)
Capital Allowances AIA 100% Plant & Machinery (max £500000)
New cars FYA capital allowances 100% if CO2 < 75g/km emissions Other past tax news blogs:
40% IHT Death tax on your hard earned money and estate when you pass away?
With the £325000 IHT exemption being so low, with house prices and estates being of higher value, do you really want to pay 40% IHT death taxes on your hard earned cash?
£1000000 X 40% = £400000 death tax Surely this wasn’t your plan?
Make a confidential appointment to discuss options available.
Will the budget establish a new threshold. Keep up to date by our blog.
Until 5th of April 2015 the Inheritance Tax threshold has been frozen at £325,000.
When someone passes away and the estate is larger than £325,000 , families are required to pay a portion of this back to the government within 6 months or interest is levied at this already difficult time. It’s worth noting, that the interest rate is now 3 % for sums not paid within a 6 months period!
HMRC (Her Majesty’s Revenue and Customs) applies 40% tax to the value of the estate exceeding the £325,000 threshold.
Its very important to note that the value of your estate does not just include property. All assets are taken into consideration; heirlooms, cars, investments, life cover, basically anything with value. Talk to us today to start understanding the potential value in your estate and the tax implications it brings to the ones you love.
If you would like to discuss any aspect of inheritance tax planning such as spousal gifts or another scheme you may have heard about, please contact us and we will assist where needed.
Remember, that planning now will ultimately save money for your family in the future.
or phone us on 07761 069218
Budget 2014- a few key areas for UK companies and taxpayers
Transferable tax allowance for some
From April 2015 married couples and civil partners may be eligible for a new transferable tax allowance.
The transferable tax allowance will enable spouses and civil partners to transfer a fixed amount of their personal allowance to their spouse. The transferable allowance is £1,050 for 2015/16 being 10% of the personal allowance.
The option to transfer will be available to couples where neither pays tax at the higher or additional rate. If eligible, one spouse will be able to transfer £1,050 of their personal allowance to the other spouse. The transferor’s personal allowance will be reduced by £1,050. It will mean that the transferee will be able to earn £1,050 more before they start paying income tax.
The claim will be made online and entitlement will be from the 2015/16 tax year. Couples will be entitled to the full benefit in their first year of marriage.
By April 2015, UK Corporation Tax will be 20%, one of the lowest in Europe.
Budget 2014 announces the government will help British businesses by:
- doubling the annual investment allowance to £500,000 until the end of 2015
- offering the best export finance in Europe
- reducing energy costs, to ensure that the UK remains a competitive location for manufacturing
1.20 Annual Investment Allowance (AIA) – Legislation will be introduced in
Finance Bill 2014 to increase the current temporary maximum of the AIA from
£250,000 to £500,000. The legislation will also extend the period of the temporary
increase. These changes will have effect:
from 1 April 2014 to 31 December 2015 for corporation tax; and
from 6 April 2014 to 31 December 2015 for income tax.
1.3 Income tax personal allowances for 2015-16 – Legislation will be
introduced in Finance Bill 2014 to increase the personal allowance for those born
after 5 April 1948 to £10,500 and set the basic rate limit to £31,785 for 2015-16.
These changes will have effect from 6 April 2015. A TIIN for this measure is available
at Annex A.
1.4 Transferable tax allowance for married couples and civil partners – As
announced in Autumn Statement 2013, legislation will be introduced in Finance Bill
2014, effective for the 2015-16 tax year, to allow a spouse or civil partner to apply to
transfer £1,050 of their personal allowance to their spouse or civil partner. The
spouse or civil partner will receive the transferable allowance as a reduction to their
income tax liability at the basic rate of tax. To be eligible to make or receive the
transfer, neither party must be liable to income tax at the higher or additional rate.
From 2016-17, the transferable amount will be 10 per cent of the personal allowance
for those born after 5 April 1938. A revised TIIN is available at Annex A.
1.5 Starting rate for savings income – Legislation will be introduced in Finance
Bill 2014 to reduce the starting rate for savings income from 10 per cent to zero per
cent, and to increase the maximum amount of an individual’s savings income that
can qualify for this starting rate from £2,880 in 2014-15 to £5,000 for 2015-16.
Secondary legislation will also ensure that savers who are not liable to pay income
tax on their savings income can register to receive interest payments from their bank
or building society without tax being deducted. These changes will have effect from
6 April 2015. A TIIN is available at Annex A.
1.6 Pensions flexibility – Legislation will be introduced in Finance Bill 2014 to:
reduce the minimum income requirement for accessing flexible drawdown to
increase the capped drawdown limit to 150% of an equivalent annuity;
increase the total pension wealth that people can have before they are no
longer entitled to receive lump sums under trivial commutation rules to
increase the small pots limit, raising the size of a pension pot that can be
taken as a lump sum regardless of total pension wealth, to £10,000;
PAYE penalties: important changes ahead
From April 2014 HMRC will get tough on employers who fail to meet their RTI reporting and payment requirements. The majority of employers are coming to the end of their first full year of reporting under RTI where ‘relaxations’ applied for small employers and few penalties for non-compliance. HMRC have announced a staggered start to interest and penalty charges:
- April 2014 – in-year interest on any in-year payments not made by the due date
- October 2014 – automatic in-year late filing penalties
- April 2015 – automatic in-year late payment penalties.
Employers can claim Employment Allowance from April 2014
From 6th April 2014, qualifying UK employers can claim the Employment Allowance and reduce their Class 1 National Insurance contributions (NICs). Those eligible for the Employment Allowance can reduce their employer Class 1 NICs by up to £2,000 each tax year. Employers can claim the Employment Allowance if they are a business or charity – including Community Amateur Sports Clubs – that pays employer Class 1 NICs on their employees’ or directors’ earnings. Businesses that belong to a group of companies or a charity that is part of a charities structure are restricted as only one company or charity can claim the allowance. It is then a decision as to which company or charity will claim the allowance.
How to claim your Employment Allowance
Employers can use their own payroll software or HM Revenue and Customs’ (HMRC’s) Basic PAYE Tools to claim the Employment Allowance. When you make your claim you must reduce your employer Class 1 NICs payment by an amount of Employment Allowance equal to your employer Class 1 NICs due; but no more than £2,000 per year. A working example: If an employer’s Class 1 NICs are £1,200 a month, in April the Employment Allowance used will be £1,200 and in May £800, as the maximum reduction is capped at £2,000. Once the claim for Employment Allowance is made, HMRC will automatically carry your claim forward each tax year. Be sure to check that your circumstances haven’t changed in the coming years.
Employers ineligible for Employment Allowance
You cannot claim the Employment Allowance if you:
- Employ someone for personal, household or domestic work, such as a nanny, au pair, chauffeur, gardener or care support worker.
- Already claim the allowance through a connected company or charity.
- Are a public authority, including local, district, town and parish councils.
- Carry out functions either wholly or mainly of a public nature (unless you have charitable status), for instance: – NHS services – General Practitioner services – The managing of housing stock owned by or for a local council – Providing a meals on wheels service for a local council – Refuse collection for a local council – Prison services – Collecting debt for a government department
You do not carry out a function of a public nature if you are:
- Providing security and cleaning services for a public building, such as government or local council offices.
- Supplying IT services for a government department or local council.
You may find some of these links helpful:
http://www.vtsoftware.co.uk/ (Book-keeping software VT Transaction + as costs @ £125 + 12 months support )
Alternatively email Helen to prepare bespoke excels spread sheets to match your business transactions. costs range from £100+ vat up to £200+vat.
www.cirencesterpolo.co.uk/ Polo is an afternoon of chic picnickers watching the best horsemanship in town.
www.hmrc.gov.uk The Tax office website can be confusing so we help with bespoke interpretation & application
http://www.davidlloyd.co.uk/home/clubs/swindon For all year round tennis & coaching