National Insurance Contributions (NIC) for the self-employed in 2023/24

Self-employed individuals are required to pay Class 2 and Class 4 NICs if their profits exceed £12,570. These NICs are usually collected with the individual’s income tax self-assessment payments.

For 2023/24, Class 2 NICs are calculated at £3.45 per week and Class 4 NICs are calculated at 9% on profits between £12,570 and £50,750, and at 2% on profits over £50,750.

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.

Capital gains tax changes

In the Autumn Statement, the Chancellor announced that the £12,300 annual tax-free capital gains tax exemption (or allowance) will be reduced to just £6,000 in 2023/24 and only £3,000 in 2024/25.

This change will mean that those disposing of capital assets will pay more tax, where the new lower allowance is exceeded.

Couples who are in the process of separating, or who have commenced divorce proceedings, need to be aware of new rules taking effect from 6 April 2023 concerning the transfer of capital assets between them as a result of their separation.

If you are planning any capital disposals, please contact us to discuss the best strategy for the disposal.

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.

Pension tax relief changes from April 2023

There was good news in the Budget for those saving in a personal pension. The current pension lifetime allowance (LTA) charge is being abolished from 6 April 2023. The LTA has caused some high earners, particularly doctors, to retire early as tax charges apply on crystallisation of pension funds if the LTA (currently £1,073,100) is exceeded.

Individuals may be able to receive 25% of their pension savings as a tax-free lump sum when they become entitled to their pension benefits. This is currently capped at 25% of the LTA and going forwards, for most individuals, will remain capped at £268,275.

Another pension limit increased by the Chancellor in the Budget was the pension Annual Allowance (AA) which increases from £40,000 to £60,000 from 6 April 2023. The AA applies to the combined pension input by the individual and, in the case of employees, their employer. Pension contributions in excess of the AA result in a tax charge on the individual, although they may take advantage of unused AA amounts from the 3 previous tax years.

For those with high incomes, the AA is tapered. From 6 April 2023, where a taxpayer’s adjusted income exceeds £260,000 (increasing from £240,000), the AA is tapered by £1 for every £2 in excess of £260,000, down to a minimum of £10,000 (increasing from £4,000).

The Money Purchase Annual Allowance (MPAA) replaces the AA when an individual starts to flexibly access a defined contribution pension scheme. The MPAA will increase from £4,000 to £10,000 on 6 April 2023.

Note that an individual’s pension contributions can be very tax efficient depending on their level of income.

The taxation rules for pensions are complex as there have been numerous changes in recent years so please talk to us about your pension contribution strategy.

Do you need further support with your pension? 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.

Letters from HMRC about Research and Development claims

Following on from the alleged abuse of the Research and Development (R&D) tax relief schemes, particularly the SME tax credit scheme, HMRC have issued “nudge” letters to the directors of over 2,000 claimant companies asking them to check their claims. Here is an extract from the letter:-

“As Company Director, it’s important you submit accurate claims for the correct amount of tax relief. If we check a claim and find it’s incorrect, your company might be asked to pay back the full amount.

This letter is not a compliance check into your Company Tax Return. It is to help you make sure your claims are complete and correct.

What you need to do now

Please review your previous R&D claim using the checklist below to make sure all the information you have given is complete and correct.

1. Have you read and understood the HMRC guidance on R&D?
2. Have you considered the conditions for making an R&D claim? Are you happy that the project is seeking an advance in the field of science and technology?
3. Do you understand what you’re claiming for?
4. Who has helped with the supporting R&D report and are they qualified to do so?
5. Have you read the R&D report, and do you agree with its contents?
6. If you’re working with a third party to make a claim, have they answered your questions satisfactorily?
7. Does this claim seem to be too good to be true?

If you’re unsure about the answers to these questions, you should contact HMRC….

…..In some circumstances we may need to open an enquiry into your claim. This could lead to a delay in us paying you any tax relief due. It could also mean that we have to reject your claim if we find it’s incorrect. And we could charge you a penalty. The best way to avoid delay, rejection of your claim, or penalties is to check your previous and future claims online now.”

We encourage all R&D claimants to consider questions 1-7 above and to contact us if they have any queries.

Do you need further guidance on research and development claims?

Our team works hard to ensure they create smart and effective tax-efficient solutions for our clients.

If you want to learn about how we can help you make a claim, or simply want some tax advice you can trust, then please don’t hesitate to contact us. You can fill out a form below or call us on 0161 962 1855.

HMRC penalties for careless and deliberate errors

As well as charging interest on tax paid late, HMRC may also levy a penalty where there is an error in a tax return. These penalties may be judged as careless or deliberate and the level of penalty will also depend upon whether or not;

• the taxpayer has been upfront, making unprompted disclosures to correct the error;
• the error was deliberate; and
• the error was concealed from HMRC.

This matter is topical following the recent sacking of the former Chancellor of the Exchequer and Chairman of the Conservative Party Nadeem Zahawi who was adjudged to have been careless in connection with the reporting of capital gains and allegedly received a 30% penalty.

The amount of the penalty is based on the Potential Lost Revenue (PLR) and the range of penalties is set out in the table below:

Higher maximum penalties may apply when offshore matters are involved.

Where HMRC issue the taxpayer with a “nudge” letter that would be regarded as a prompt from the department and thus potentially increases the level of penalty that might be imposed.

The law defines ‘careless’ as a failure to take reasonable care and needs to have consideration of the taxpayer’s abilities and circumstances. In HMRC’s view it is reasonable to expect a person who encounters a transaction or other event with which they are not familiar to take care to find out about the correct tax treatment or to seek appropriate advice. A taxpayer who can demonstrate that they acted on professional advice from a person with the appropriate expertise, will normally be able to demonstrate they take reasonable care.

HMRC may reduce, or mitigate, the penalty depending on the quality of the disclosure, but any such reduction will not take the penalty percentage below the bottom of the stated range. The quality of disclosure is based on three factors – ‘telling’, ‘helping’, and ‘allowing access to records’.

HMRC may also suspend a penalty if it can be demonstrated that controls can and will be put in place to prevent the matter occurring again in future.

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.

Important Research & Development tax changes from April 2023

The government are committed to a number of important changes to Research & Development (R&D) tax relief from 1 April 2023. It also looks increasing likely that the two existing systems will be merged into a single system in future years and we hope to hear more in the March 2023 Budget.

We already know that there will be a significant reduction in the tax relief available to qualifying SME companies from 1 April 2023, with the current 230% tax relief reducing to just 186%. The effect of this change combined with the reduction in the credit rate will reduce the repayable credit for loss making SMEs from £33.35 per £100 spend to just £18.60. Companies affected should consider the timing of their R&D expenditure.

For non-SME companies the R&D Expenditure Credit (RDEC) is being increased from 13% to 20% as part of the gradual alignment.

There are also important changes to the claims notification procedure from April 2023.

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.

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.

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.

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

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.

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.

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.

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.

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

Do you need further guidance on the VAT registration limits? We offer a wide range of VAT services for 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 don’t hesitate to contact us.

For more information please contact us on 0161 962 1855. Alternatively, you can email us using the form below and we will contact you as soon as possible.

Cars, Vans and Taxation!

For those provided with an electronic or ultra-low emission company car (emitting less than 75g of CO2 per kilometre), there will be annual increases in the benefit-in-kind percentages, and therefore the taxes paid by both employees and employers, from the 2025/26 tax year.

For all other company car users, there will be a 1 percentage point increase (up to a maximum of 37%) in the calculation of the benefit-in-kind in 2025/26 before being fixed for the following two tax years.

The fixed multipliers used to calculate benefits-in-kind on employer provided vans, van fuel (for private journeys in company vans) and car fuel (for private journeys in company cars) will increase in line with the Consumer Price Index (CPI) from 6 April 2023.

More announcements on Cars, Vans and Taxation

The government have also announced that they will introduce Vehicle Excise Duty on electric cars, vans and motorcycles from April 2025.

Do you need further guidance on company cars? 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.

Capital Gains Tax annual exemption cut

Many were predicting that the rates of Capital Gains Tax (CGT) paid by individuals would increase, possibly to align with the rates of income tax.

Instead, the Chancellor has announced that the current £12,300 annual tax-free CGT exemption (or allowance) will be reduced to just £6,000 in 2023/24 and only £3,000 in 2024/25.

This change will mean that those disposing of investments such as shares, second homes and buy-to-let properties will pay more tax.

If you are planning any capital disposals, please contact us to discuss the best strategy for timing of sale.

Do you need further advice on capital gains tax?

We offer a wide range of accountancy services to help. Our team of chartered accountants have a wealth of experience in a broad range of sectors, from construction and property to the charity sector. We work hard to deliver smart and effective tax-efficient solutions for all businesses.

If you want to learn more about how the team can help or simply want some start-up advice from a trusted accountant don’t hesitate to contact us. You can call, email, or use the form below.

A mini U-turn on Stamp Duty Land Tax

One of the few changes announced on 23 September that has not been reversed concerns the U-turn on Stamp Duty Land Tax (SDLT) in England and Northern Ireland. The starting threshold was increased from £125,000 to £250,000 (and, for First Time Buyers, from £300,000 to £425,000) from 23 September 2022.

However, it has now been announced that these are to be temporary changes and, from 1 April 2025, the thresholds will return to their original rates.

And remember…

As previously announced and as we head into 2023;

• The £1million Annual Investment Allowance – giving 100% tax relief to businesses investing in qualifying plant and machinery – is now permanent.
• The Government is increasing the generosity and availability of certain Venture Capital Schemes, including the Seed Enterprise Investment Scheme for start-up companies.

And finally, in all matters, we are here to help you. Please do get in touch about any of the Autumn Statement measures or otherwise.

Do you need further guidance on the mini U-turn on Stamp Duty Land Tax?

Get in touch with our team of property accountants for advice and support you can trust. You can contact us on 0161 962 1855 or by filling out the form below and we will contact you as soon as possible.

Employers will be relieved that there are no more changes to National Insurance Contribution rates and bandings or therefore consequential payroll software changes!

Like the main income tax bandings, National Insurance Contribution thresholds are now also frozen until 5 April 2028. This means that employers’ NIC will continue to apply at 13.8% to earnings in excess of £9,100 a year (£175 per week) and employees and the self-employed will continue to pay 12% and 9% respectively on earnings/profits between £12,570 and £50,270 and 2% thereafter.

Despite rumours to the contrary, the 1.25 percentage point increase to NIC rates that has just been removed from 6 November 2022, will not be making a return from 6 April 2023.

Do you need further guidance on the National Insurance Contribution? 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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For all individuals, the first £2,000 of dividend income is taxed at 0%.

The government have now decided that this ‘dividend allowance’ of £2,000 will be reduced to £1,000 in the 2023/24 tax year and then again to just £500 in the 2024/25 tax year.

It should be remembered that the income tax rates applied to dividend income outside of the allowance have only recently been increased to 8.75%, 33.75% and 39.35% (for dividend income falling into basic rate, higher rate and additional rate bands respectively).

Combined, these measures will mean that those reliant on dividend income will pay more tax.

If you are a director/shareholder, please contact us to discuss the best strategy for extracting profits from your company from 6 April 2023.

Do you need further guidance on dividend income? 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.

Overview of the Annual Investment Allowance

The £1 Million annual investment allowance is here to stay. You can claim capital allowances when you buy assets that you keep to use in your business, for example:

What are the changes to the Annual Investment Allowance?

The Government will continue to support business capital investment by keeping the level of the 100% Annual Investment Allowance (AIA) at £1 million.

This deduction is available to unincorporated businesses as well as limited companies if they invest in new or second-hand equipment.

We are, however, expecting the temporary 130% ‘super-deduction’ for company expenditure on qualifying new equipment to come to an end on 31 March 2023.

Do you need further guidance on the Annual Investment 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.

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

The 23 September Fiscal Statement included the unexpected news that the “off-payroll working” (OPW) rules would be scrapped from 6 April 2023.

These rules were introduced for public sector employers from 6 April 2017 and then extended to large and medium-sized private-sector organisations from 6 April 2021.

It has now been announced that the OPW rules will continue to apply. Affected organisations will continue to be required to determine whether or not a worker providing services via their personal service company (PSC) would be classed as an employee if they were working directly for the organisation. If so, then PAYE and NICs need to be deducted from the supplier payments made to the PSC. Employers’ NICs also need to be paid.

Where a PSC supplies services to a small private-sector organization, the ‘IR35’ rules also continue to apply. These effectively require the PSC, rather than the service-acquiring organisation, to ensure compliance.

Do you need further guidance on the off-payroll working rules?

If you want to learn more about how the team can help or simply want some payroll advice from a trusted accountant don’t 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.

The £1 million Annual Investment Allowance has now been made permanent.

An overview

You can claim capital allowances when you buy assets that you keep to use in your business, for example:

• equipment
• machinery
• business vehicles, for example vans, lorries or cars

Annual investment allowance

The changes to the £1 million Annual Investment Allowance 

Businesses investing in plant and machinery will welcome the decision to make the £1 million Annual Investment Allowance  permanent. This has been extended several times and was scheduled to revert to just £200,000 from April 2023. Unlike the super-deduction, the Annual Investment Allowance is available to unincorporated businesses as well as limited companies and the equipment does not have to be new.

Do you need further guidance on the £1 million Annual Investment 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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The Government has announced two changes to the tax advantaged Company Share Option Plan scheme. But what are all the Tax and Employee Share Schemes?

An overview

If your employer offers you company shares, you could get tax advantages, like not paying Income Tax or National Insurance on their value.

Tax advantages only apply if the shares are offered through the following schemes:

• Share Incentive Plans
• Save As You Earn (SAYE)
• Company Share Option Plans
• Enterprise Management Incentives (EMIs)

What are the changes to the Company Share Option Plan scheme?

There is currently a maximum employee share option limit based on market value at grant of £30,000. This will be increased to £60,000 for any new options granted from 6 April 2023. Existing options are unaffected by this change.

There will also be increased flexibility for share options granted from 6 April 2023 due to a removal of conditions around the class of shares used.

The Company Share Option Plan scheme is available to most UK trading companies as, unlike the Enterprise Management Incentives (EMI) share scheme, there is no size limit, and no restrictions over the nature of the business undertaken.

Do you need further guidance on the Company Share Option Plan scheme?

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.

IR35 U-turn announcement

The much criticised “off-payroll” working rules were introduced for the public sector from 6 April 2017 and then extended to large and medium-sized private-sector organisations from 6 April 2021.

The rules replaced the ‘IR35’ rules where workers supplied their services to these organisations via a personal service company (PSC) or other intermediary. The effect was to transfer the, not insignificant, tax compliance burden from the PSC to the service-acquiring organisation.

What will the new IR35 U-turn look like?

The off-payrolling rules will now be removed from 6 April 2023 and the IR35 compliance burden will revert to resting with the PSC itself. This means the PSC must calculate and pay PAYE and NICs if the worker (often the Director) would be classed as an employee if they were working directly for the service-acquiring organisation. This aligns with the requirements in cases where a PSC supplies services to a small private-sector organisation.

Do you need further guidance on the IR35 U-turn announcement?

We offer a wide range of services which are unique to your business and we work with many contractors. 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.

New investment zones within the UK

The Government is in discussion with 38 local authority areas in England to set up ‘Investment Zones’ in specific sites within their area.

What will the government offer to the new investment zones?

Each of the Investment Zones (IZ) will offer generous, targeted and time limited tax cuts for businesses along with liberalised planning rules to release more land for housing and commercial development.

These will be hubs for growth, encouraging investment in new shopping centres, restaurants, apartments and offices, and creating thriving new communities. The tax incentives under consideration are:

1. 100% Business Rates Relief– on newly occupied or expanded business premises in IZs.
2. 100% first year allowance – for companies with qualifying expenditure on assets for use in IZs
3. Enhanced Structures and Buildings Allowance– to allow businesses to reduce their taxable profits by 20% of the cost of qualifying non-residential investment per year, relieving 100% of their cost of investment over 5 years
4. Zero-rate employer NIC – on salaries of any new employee working in the IZ for at least 60% of their time, on earnings up to £50,270 per year, with Employer NICs being charged at the usual rate above this level.
5. Full Stamp Duty Land Tax (SDLT) relief – for land and buildings bought for use or development for commercial purposes, and for purchases of land or buildings for residential developers.

A list of the 38 local authorities taking part in discussions can be viewed in this factsheet – www.gov.uk/government/publications/the-growth-plan-2022-factsheet-on-investment-zones.

Encouraging investment in unlisted companies 

The new Chancellor has given his support to the tax-advantaged Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCT) and said he sees the value of extending them in the future.

The vision is for the UK to be an entrepreneurial, share-owning democracy.

In relation to the Seed Enterprise Investment Scheme (SEIS), the Treasury have confirmed that they are widening the criteria and will be allowing companies to raise £250,000 under the scheme, 66% more funding than previously.

The SEIS currently provides unconnected investors with an income tax deduction of 50% of the amount invested, up to £100,000 a year. There is also generous capital gains tax relief for the investor.

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.

Capital Gains Tax – proposed divorce changes

In response to a recommendation by the Office of Tax Simplification the Government have introduced draft legislation for inclusion in Finance Bill 2023. That extends the no gain/no loss rule when a couple separate.

Under the current rules, the no gain/no loss rule that means that there is no CGT on transfers of assets between spouses or civil partners. This applies up to the end of the tax year in which they separate. The divorce settlement or court order that transfers assets between the couple, often takes place many months after the separation. This may lead to CGT being payable.

No gain/no loss treatment

The main change proposed is that separating spouses or civil partners will be given up to three years after the year they cease to live together. In this time they can make no gain/no loss transfers. Most divorces would be concluded within this period.

No gain/no loss treatment will also apply to assets transferred as part of a formal divorce agreement.

We offer a wide range of services which are unique to your business. Do you need further guidance on Capital Gains Tax?

Our team of chartered accountants have a wealth of experience in a broad range of sectors. Our team work hard to ensure they create smart and effective tax-efficient solutions. 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.

Inflation is creating more entrepreneurs:

A need for additional income is motivating people to start their own businesses.

As UK inflation hits a 40-year high of over 9%, more and more people are starting their own businesses.

New technology such as online payment systems, digital marketing tools and free online resources are helping to remove the traditional barriers in setting up your own business.

The number of people setting up their own businesses in the UK skyrocketed in the past 12-18 months and this was largely driven by redundancies and furloughing during the pandemic. As a result, firms such as QuickBooks, Xero and Sum Up are thriving as they are geared towards serving tech savvy, small and medium sized owner-managed businesses.

Now, as the cost of living has risen so dramatically, a further wave of entrepreneurs are starting businesses in order to generate some extra income. Helpfully, according to a recent survey, the UK is considered one of the best places for entrepreneurs to start a business thanks to its skilled workforce, tax and legal systems.

The current wave of new entrepreneurs creates opportunities for other businesses that can help startups to get up and running, then grow and develop their new ventures. New entrepreneurs need an array of services such as IT, accounting, tax, banking, premises, logistics, staffing and more.

Sustainability is a key trend among the small and medium-sized business community in the UK. According to a recent report from the Federation of Small Businesses, 56% of small businesses believe the world is facing a climate crisis and 36% have a plan in place. Sustainability is clearly being taken seriously by entrepreneurs and if you intend to sell your products or services to them, sustainability should be top of your agenda too.

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.