By Katie Business News • Tax News 0 Comments

Reminder that the Super-Deduction allowance ends 31/03/2023

Reminder That The Super-Deduction Allowance Ends 31/03/2023

Companies considering the acquisition of new plant and machinery need to be aware that the temporary ‘super-deduction’ of up to 130% for the cost of acquiring new plant ends on 31 March 2023.

Consequently, corporate businesses may wish to bring forward planned expenditure to take advantage of this enhanced tax deduction, utilising hire purchase agreements if funds are otherwise unavailable.

The government has offered unprecedented support for businesses during Covid. Even so, pandemic-related economic shocks and the accompanying uncertainty have chilled business investment. This super-deduction will encourage firms to invest in productivity-enhancing plant and machinery assets that will help them grow, and to make those investments now. See the Super-deduction factsheet here for more information.

Need more information?

Do you need further guidance on the Super-Deduction Allowance?

We offer a wide range of services which are unique to your business! Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

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    By Katie Tax Advice • Tax News 0 Comments

    Reduce your 2021/22 tax bill

    Reduce your 2021/22 tax bill

    If you would like to legitimately reduce your 2021/22 tax bill that you have just paid, or your bill for 2022/23, you might want to consider investing in shares in qualifying Enterprise Investment Scheme (EIS) companies.

    Under this HMRC approved scheme every £1,000 you invest reduces your tax bill by £300 (30%), provided you are not connected with the company. Broadly you are not allowed to be an employee or control more than 30% of the company.

    The reduction in your tax bill is available in the tax year in which the shares are issued, however you may elect to treat some or all of the shares as issued in the previous year and claim tax relief in that previous year.

    If you are prepared to take more of a risk by investing in small start-up companies, the Seed EIS scheme provides a 50% tax deduction on up to £100,000 of investments.

    Although we can advise you on the tax advantages of investing in EIS and Seed EIS companies you will need to consult with a suitably qualified Independent Financial Adviser who will help you find investments appropriate to your needs.

    Need more information?

    Do you want to reduce your 2021/22 tax bill?

    We offer a wide range of services which are unique to your business and our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

    Our fantastic team at A&C Chartered Accountants are here to help.

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      By Katie Business News • Tax News 0 Comments

      Making tax digital for income tax delayed again

      Making tax digital for income tax delayed again

      Making tax digital (MTD) for income tax self-assessment (ITSA) was originally scheduled to start in 2018 and was then put back to 2023 and then 2024. It was announced just before Christmas that the new system of submitting digital information quarterly to HMRC has been delayed yet again! The start date will now depend upon the gross business receipts of the individual.

      Self-employed individuals and landlords with annual gross receipts above £50,000 will need to follow the rules for MTD for ITSA from 6 April 2026. Those with annual gross receipts between £30,000 and £50,000 will be mandated into the regime from 6 April 2027.

      Whether MTD for ITSA will apply to those with gross receipts under £30,000 is under review but it would appear that the government have finally increased the starting threshold from £10,000, which they have resisted up until now.

      Despite the delay in the mandatory start date for MTD for ITSA, businesses should nevertheless consider whether or not it would be beneficial to keep their business records digitally anyway.

      The date when partnerships will be required to join MTD for ITSA has not been set and may be clarified in the March 2023 Budget.

      However new tax year basis goes ahead

      Although the start of MTD for ITSA has been delayed to 2026 at the earliest, the start date of the new regime for taxing the profits of unincorporated businesses on a tax year basis has not been delayed and the transition will still take effect in the tax year to 5 April 2024.

      This will be a major change for those unincorporated businesses that prepare their accounts to a date other than 5 April or 31 March. From 6 April 2024 such businesses will need to compute their taxable profits from 6 April to 5 April each year, regardless of their accounting end date.

      So, for a sole trader or partnership making up accounts to 31 December each year, their 2024/25 profits would be calculated as 9/12ths of their profits for the year ended 31 December 2024 plus 3/12ths of their profits for the year ended 31 December 2025.

      This will invariably require the inclusion of an estimate of the profits of the later period with subsequent amendment once the final figures are known. For this reason many businesses may wish to consider changing their accounting date and we can of course advise you of the tax consequences.

      More imminent is the change in the way that profits are to be taxed for the 2023/24 tax year. The upcoming tax year is scheduled to be a “transitional year” with complicated rules for calculating business profits. For many businesses the change will result in a higher tax bill and, if you can supply us with estimated figures, we can work with you to calculate the impact on your cash flow.

      Please note that although MTD for ITSA will only apply to the self-employed and landlords initially, these tax year basis changes apply to all unincorporated businesses, including partnerships and LLPs, and those with profits of less than £50,000.

      As mentioned before, those already preparing accounts to 31 March or 5 April are not affected.

      Need more information?

      Do you need further guidance on Making tax digital for income tax?We offer a wide range of services which are unique to your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

      Our fantastic team at A&C Chartered Accountants are here to help.

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        By Katie Business News • Tax Advice • Tax News 0 Comments

        Diary of main tax events January / February 2023

        Please find below the diary of main tax events January / February 2023. As always, if you need help in meeting these deadlines, do not hesitate to get in touch with our team.

        Date What’s Due
         

        01/01

        		 Corporation tax payment for year to 31/3/22 (unless quarterly instalments apply)
         

        19/01

        		 PAYE & NIC deductions, and CIS return and tax, for month to 5/01/23 (due 22/01 if you pay electronically)
         

        31/01

        		 Deadline for Self-Assessment tax return for 2021/22 if filed online. Also the due date for 2021/22 balancing payment and 50% payment on account of 2022/23 tax.

         

        Note that if this liability is no more than £30,000 you can agree with HMRC to spread over 12 months
        01/02 Corporation tax payment for year to 30/4/22 (unless quarterly instalments apply)
        19/02 PAYE & NIC deductions, and CIS return and tax, for month to 5/02/23 (due 22/02 if you pay electronically)

        Need more information?

        Do you need further guidance on our diary of main tax events January / February 2023? We offer a wide range of services which are unique to your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

        Our fantastic team at A&C Chartered Accountants are here to help.

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          By Katie Tax 0 Comments

          Advisory reimbursement rates for employees’ private mileage

          The table below sets out the HMRC advisory reimbursement rates for employees’ private mileage using their company car from 1 December 2022. Where full reimbursement is made there is no taxable fuel benefit. The rates for the previous quarter, if different, are in brackets.

          Engine Size Petrol Diesel LPG
          1400cc or less 14p

          (15p)

           

          		   10p

          (9p)
          1600cc or less 14p

           
          1401cc to 2000cc 17p

          (18p)

           

          		 12p

          (11p)

           
          1601 to 2000cc 17p

           
          Over 2000cc 26p

          (27p)

           

          		 22p

           

          		 18p

          (17p)

           

           

          Note that for hybrid cars you must use the petrol or diesel rate and for fully electric cars the rate is now 8p per mile (previously 5p per mile)

          You can continue to use the previous rates for up to 1 month from the date the new rates apply.

          Need more information?

          Do you have company cars within your business and need help with the advisory reimbursement rates? We offer a wide range of services which are unique to your business! Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

          Our fantastic team at A&C Chartered Accountants are here to help.

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            By Katie Business Advice • Tax Advice 0 Comments

            New Year’s resolutions to save tax

            New Year’s resolutions to save tax

            At this time of year we think about New Year’s resolutions. It is also a good time to start planning your tax affairs before the end of the tax year on 5th April.

            An obvious tax planning point would be to maximise your ISA allowances for the 2022/23 tax year (currently £20,000 each).

            You might also want to consider increasing your pension savings before 5 April 2023 as the unused annual pension allowance from 2019/20 lapses after three years.

            Many of us get together with the family at Christmas and that prompts us to think about making or updating our Will.

            Pension planning

            For most taxpayers the maximum pension contribution is £40,000 each tax year, although this depends on their earnings. This limit covers both contributions by the individual and by their employer.

            Under the current rules, the government adds to your pension contributions at the 20% basic rate. For instance, if you save £4,000 in a personal pension the government tops this up to £5,000. If you are a higher rate taxpayer there is a further £1,000 tax relief when your tax liability is calculated, reducing the net cost to £3,000. This can be even more effective if your income is between £100,000 and £125,140 where the effective tax rate is 60%. Remember that pension fund investments can go down as well as up.

            Time to review your will?

            Top of the New Year to do list for many individuals is to make or update their Will. Many think this is something to leave until later in life but it is important to get things in place once property is acquired or when children come along.

            In the absence of a will there are statutory rules which dictate how your assets are distributed on death. Those statutory intestacy rules may not be tax efficient and you might to want to make specific provision in your Will for your unmarried partner or for the guardianship of your children.

            Passing on the family home

            When considering the wording of your Will you should note that the inheritance tax (IHT) nil rate band continues to be frozen at £325,000 until 2028. There is an additional nil rate band of up to £175,000 for passing on the family home to direct descendants on death. We can work with your solicitor to make sure your Will is tax efficient.

            Where the nil bands are unused on the death of the first spouse the balance is available on the death of the surviving spouse, potentially allowing a married couple (or civil partners) to pass on assets of up to £1 million without paying IHT.

            The residence nil band is even available when you downsize to a cheaper property. For example if a married couple currently live In a large house worth £500,000 and downsize to a flat worth £300,000 they could give away some of the proceeds during their lifetime and yet still benefit from inheritance tax relief based on the higher valued property.  They could even sell the house and move into a rental property or a care home and still benefit from this additional relief. In these circumstances, certain conditions must be met, so please speak to us if you think it may affect you.

            Need more information?

            Do you have any New Year’s resolutions to save tax?

            We offer a wide range of services which are unique to your businesses who are just getting going! Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

            Our fantastic team at A&C Chartered Accountants are here to help.

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              By Katie Tax Advice • Tax News 0 Comments

              Capital gains tax allowance – use it or lose it

              Capital gains tax allowance – use it or lose it

              The Capital gains tax annual exempt amount reduces from £12,300 to just £6,000 for gains made in 2023/24. Remember that the 2022/23 allowance is lost if not used by 5 April 2023 and you might want to consider bringing forward disposals of chargeable assets where possible.

              Where a married couple who are higher rate taxpayers own a buy to let property, bringing forward the disposal from 2023/24 could potentially save £3,528 CGT (£24,600 – £12,000 @ 28%). It would be important to exchange contracts before 6 April 2023 as that is the critical date for Capital gains tax.

              Need more information?

              Do you need further guidance with the Capital gains tax allowance? We offer a wide range of services which are unique to your businesses who are just getting going! Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

              Our fantastic team at A&C Chartered Accountants are here to help.

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                By Katie Tax Advice • Tax News 0 Comments

                New VAT penalties for late returns

                New VAT penalties for late returns

                A new points-based system for late VAT returns starts for return periods commencing on or after 1 January 2023. A financial penalty will apply when a number of points have been accumulated, which will depend on how frequently the returns should be submitted. For a trader preparing quarterly returns a penalty will be charged when four points have been accumulated.

                Need more information?

                Do you need help with the New VAT penalties?

                We offer a wide range of services which are unique to your businesses who are just getting going! Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

                Our fantastic team at A&C Chartered Accountants are here to help.

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                  By Katie Business News • Tax News 0 Comments

                  VAT registration limits unchanged until March 2026

                  VAT registration limits

                  The VAT registration threshold continues to be frozen at £85,000, instead of increasing each year in line with inflation. This will remain the case until March 2026.

                  When to register for VAT

                  You must register if:

                  • your total VAT taxable turnover for the last 12 months was over £85,000 (the VAT threshold)
                  • you expect your turnover to go over £85,000 in the next 30 days

                  You must also register (regardless of VAT taxable turnover) if all of the following are true:

                  • you’re based outside the UK
                  • your business is based outside the UK
                  • you supply any goods or services to the UK (or expect to in the next 30 days)

                  How to register for VAT

                  Register for VAT

                  You can usually register for VAT online.

                  By doing this you’ll register for VAT and create a VAT online account (sometimes known as a ‘Government Gateway account’). You need this to submit your VAT Returns to HM Revenue and Customs (HMRC).

                  Using an agent

                  You can appoint an accountant (or agent) to submit your VAT Returns and deal with HMRC on your behalf.

                  If you’re using an agent, you can still sign up for a VAT online account when you receive your VAT number (select option ‘VAT submit returns’).

                  Need more information?

                  Do you need further guidance on the VAT registration limits? We offer a wide range of services which are unique to your business. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. Our team work hard to ensure they create smart and effective tax-efficient solutions for start-ups to optimise growth and help them succeed. If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant do hesitate to contact us. For more information please do hesitate to contact us on 0161 962 1855. Alternatively you can email us using the form below and we will contact you as soon as possible.

                  Our fantastic team at A&C Chartered Accountants are here to help.

                  Contact us below

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