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Thursday 16th November 2017

Winter 2017 Newsletter

This edition includes articles on changes to pension auto-enrolment and an update on the National Minimum Wage.

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Wednesday 30th August 2017

Autumn 2017 Newsletter

In this edition there are articles on the delayed Making Tax Digital plans and the new data protection rules.

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Wednesday 14th June 2017

Summer 2017 Newsletter

The Summer edition of the newsletter highlights the changes to the dividend allowance and the current position with Making Tax Digital

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Thursday 16th March 2017

Spring 2017 Newsletter

The Spring edition of the newsletter leads on changes to the VAT flat rate scheme

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Friday 7th October 2016

Autumn 2016 Newsletter

In this edition there are articles on Brexit, auto enrolment and cyber security for businesses.

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Tuesday 8th May 2018

The Federation of Small Businesses (FSB) is warning small and medium-sized enterprises that time is running out for them to prepare.

With less than one month until the introduction of the new General Data Protection Regulation (GDPR), the Federation of Small Businesses (FSB) is warning small and medium-sized enterprises (SMEs) that time is running out for them to prepare.

The business group stated that small businesses face an ‘uphill challenge’ in ensuring that they are compliant by the date when GDPR takes effect of 25 May 2018.

Under the new rules, organisations which collect, store and process individuals’ personal data will be subject to new obligations, with an increased emphasis on accountability and transparency.

The financial penalties for failing to comply are severe, with fines costing up to €20 million or up to 4% of total annual worldwide revenue, whichever is the greater.

Mike Cherry, National Chairman of the FSB said:

‘As the GDPR deadline swiftly approaches, there is a real danger that many small businesses are yet to have adequately prepared for the changes. Fortunately for these businesses, there is still time on the clock to start, or finish, their preparations.’

‘The GDPR is the largest shake-up of data protection laws for years, and whether you are a personal trainer or a consultant, most businesses will have to implement changes to their current practices to make sure they are complying with the new rules.’

Further information on the GDPR can be found on the ICO website.

Internet links: ICO guidance FSB press release

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Tuesday 8th May 2018

The Government has stated that it will ensure that tax reliefs continue to work as they were intended as the new Scottish Income Tax rates and bands are introduced.

The Government has stated that it will ensure that tax reliefs continue to work as they were intended as the new Scottish Income Tax rates and bands are introduced from 6 April 2018. The Government has confirmed:

  • Marriage Allowance
    Marriage Allowance allows taxpayers to transfer 10% of their tax-free Personal Allowance to their spouse or civil partner, reducing their tax bill by up to £230 in 2017 to 2018, and £238 in 2018/19. The UK government will ensure that all those claiming Marriage Allowance in Scotland can continue to do so at the current rate (20%).

  • Gift Aid
    Gift Aid allows charities to claim back 25p for every £1 donated. The UK government will make changes to ensure that Scottish taxpayers can benefit from the right rate of tax relief on Gift Aid. Gift Aid will continue to be paid to charities at the basic rate, with Scottish taxpayers able to claim the correct amount of additional relief on top of this.

  • Pensions relief at source
    The UK government confirmed that current processes will continue while it works with stakeholders to establish how this will work in the longer term. For 2018/19, Scottish taxpayers who receive relief on their contributions at source will, therefore, continue to receive relief in their pension pot at 20%, with no adjustment for those taxed at a rate of less than 20%, and scope for those taxed at a rate higher than 20% to claim additional relief.

  • Social security pension lump sum
    The UK government will make changes so that Scottish taxpayers who receive a social security pension lump sum will be taxed, where appropriate, at the new Scottish starter rate.

  • Finance cost relief 
    This will continue to apply at 20%, the same rate applicable to landlords across the UK.

Please contact us if you have queries on the workings of any of these tax reliefs for Scottish taxpayers and those resident elsewhere across the United Kingdom.

Internet link  GOV.UK changes to tax relief Scotland

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Tuesday 8th May 2018

The Enterprise Management Incentive (EMI) allows selected employees (often key to the employer) to be given the opportunity to acquire a significant number of shares in their employer through the issue of options.

The Enterprise Management Incentive (EMI) allows selected employees (often key to the employer) to be given the opportunity to acquire a significant number of shares in their employer through the issue of options. An EMI can offer significant tax advantages as the share option scheme allows options to be granted to employees which may allow the shares to be received without any tax bill arising until the shares are sold.

HMRC have warned that EMI share options granted in the period from 7 April 2018 until EU State Aid approval is received may not be eligible for the tax advantages presently afforded to option holders, and accordingly share options granted in that period as EMI share options may necessarily fall to be treated as non-tax advantaged employment-related securities options meaning that the options may be taxable when exercised.

To read more, please visit the link below or contact us for specific advice.

Internet link: GOV.UK EMI Bulletin

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Tuesday 8th May 2018

The forms P11D which report details of benefits and some expenses provided to employees and directors for the year ended 5 April 2018, are due for submission to HMRC.

The forms P11D which report details of benefits and some expenses provided to employees and directors for the year ended 5 April 2018, are due for submission to HMRC by 6 July 2018. The process of gathering the necessary information can take some time, so it is important that this process is not left to the last minute.

Employees pay tax on benefits provided as shown on the P11D, generally via a PAYE coding notice adjustment or through the self assessment system. Significant changes were introduced to the rules for reporting expenses from 6 April 2016.

Some employers ‘payroll’ benefits and in this case the benefits do not need to be reported on forms P11D but employers should advise employees of the amount of benefits payrolled.

In addition, regardless of whether the benefits are being reported via P11D or payrolled the employer has to pay Class 1A National Insurance Contributions at 13.8% on the provision of most benefits. The calculation of this liability is detailed on the P11D(b) form. The deadline for payment of the Class 1A NIC is 19th July (or 22nd for cleared electronic payment).

HMRC produce an expenses and benefits toolkit. The toolkit consists of a checklist which may be used by advisers or employers to check they are completing the forms correctly.

If you would like any help with the completion of the forms or the calculation of the associated Class 1A NIC please get in touch.

Internet links: HMRC guidance Toolkit

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Tuesday 8th May 2018

HMRC have issued details of the updated VAT fuel scale charges which apply from the beginning of the next prescribed VAT accounting period starting on or after 1 May 2018.

HMRC have issued details of the updated VAT fuel scale charges which apply from the beginning of the next prescribed VAT accounting period starting on or after 1 May 2018.

VAT registered businesses use the fuel scale charges to account for VAT on private use of road fuel purchased by the business.

Please do get in touch for further advice on this or other VAT matters.

Internet link: GOV.UK fuel scale charges

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Tuesday 8th May 2018

HMRC are consulting on the tax exemption which will apply from 6 April 2018 on workplace electric charging facilities used by employees.

HMRC are consulting on the tax exemption which will apply from 6 April 2018 on workplace electric charging facilities used by employees.

It was announced in the Autumn Budget 2017 that the government intends to implement an exemption for the benefit of electricity provided by an employer, at the workplace, to charge electric or plug-in hybrid vehicles. The necessary legislation will be included in the Finance Bill later this year and its effect will be made retrospective to 6 April 2018.

This means that there is no need for employers to report the value of electricity provided for the workplace charging of employees’ vehicles from that date.

This consultation seeks comments on workplace charging tax exemptions for electric and plug-in hybrid vehicles.

This guidance will be of interest to employers that pay taxable benefits to employees and provide electric charging points for employee use and the provision of workplace charging facilities, which vehicles the exemption covers and the qualifying conditions of the exemption.

Internet link: GOV.UK consultations/draft guidance

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Wednesday 4th April 2018

New data protection rules from General Data Protection Regulation (GDPR) will replace the Data Protection Act in the UK from 25 May 2018.

New data protection rules from General Data Protection Regulation (GDPR) will replace the Data Protection Act in the UK from 25 May 2018.

GDPR is designed to safeguard personal data of citizens from EU member states, with particular emphasis on transparency and accountability. It applies to all businesses in the EU and non-compliance will lead to substantial fines.

The new GDPR is a regulation which is intended to strengthen and unify data protection for all individuals within the European Union (EU). The regulation will become a law without exception in the UK from 25 May 2018. The government has confirmed that the UK’s decision to leave the EU will not affect the commencement of the GDPR.

The government has also confirmed that the UK will replace the 1988 Data Protection Act (DPA) with legislation that mirrors GDPR, post-Brexit. This means that any business, big or small, will be required to comply with GDPR - which deals with secure collection, storage and usage of clients’ personal data.

Failure to comply with the regulation can result in heavy fines of up to €20 million or 4% of the businesses’ annual turnover (whichever is higher amount).

Internet link: ICO guide to GDPR

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Wednesday 4th April 2018

Many employers help employees with childcare costs, often by providing childcare vouchers by way of salary sacrifice.

Many employers help employees with childcare costs, often by providing childcare vouchers by way of salary sacrifice. Following the roll out of Tax-Free Childcare (TFC), the new government scheme to help working parents, existing Employer-Supported Childcare (ESC) schemes were expected to close to new joiners from April 2018.

However following the Chancellor’s Spring Statement, Education Secretary Damian Hinds, made a concession to delay scrapping the scheme by six-months.

The Childcare Choices website which provides useful guidance to parents on the childcare options available to them including ESC, TFC and other free entitlements has been updated to show that childcare vouchers will be available to new joiners until the end of September 2018.

Under the rules employees already using ESC can choose whether to remain in existing schemes or switch to TFC, but parents cannot be in both TFC and ESC at the same time.

Internet link: GOV.UK Childcare Choices

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Wednesday 4th April 2018

The regulations to bring into force Making Tax Digital for VAT (MTDfV) are now law.

The regulations to bring into force Making Tax Digital for VAT (MTDfV) are now law, and digital VAT returns will be required from 1 April 2019.

MTDfV is the first phase of HMRC’s landmark Making Tax Digital (MTD) regime, which will ultimately require taxpayers to move to a fully digital tax system. Regulations have now been issued which set out the requirements for MTDfV.

Under the new rules, businesses with a turnover above the VAT threshold (currently £85,000) must keep digital records for VAT purposes and provide their VAT return information to HMRC using MTD functional compatible software.

The new rules have effect from 1 April 2019, where a taxpayer has a ‘prescribed accounting period’ which begins on that date, and otherwise from the first day of a taxpayer’s first prescribed accounting period beginning after 1 April 2019.

HMRC is piloting MTDfV during 2018, ahead of its introduction in April 2019. Keeping digital records and making quarterly updates will not be mandatory for taxes other than VAT before April 2020, although businesses below the VAT threshold which have voluntarily registered for VAT can opt to join the scheme.

As with electronic VAT filing at present, there will be some exemptions from MTD for VAT. However, the exemption categories are tightly-drawn and unlikely to be applicable to most VAT registered businesses.

Keeping digital records will not mean businesses are mandated to use digital invoices and receipts but the actual recording of supplies made and received must be digital. It is likely that third party commercial software will be required. Software will not be available from HMRC. The use of spreadsheets will be allowed, but they will have to be combined with add-on software to meet HMRC’s requirements.

Internet link: GOV.UK statutory instrument

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Wednesday 4th April 2018

From 1 April 2018, Land Transaction Tax (LTT) will replace Stamp Duty Land Tax (SDLT).

From 1 April 2018, Land Transaction Tax (LTT) will replace Stamp Duty Land Tax (SDLT). LTT will be collected by the Welsh Revenue Authority (WRA). HMRC has published guidance on the introduction of the new tax and the way in which property transactions straddling 1 April 2018 and cross border transactions will be dealt with.

Property Taxes across the UK

From 22 November 2017, there is an exemption for first-time buyers from SDLT on the first £300,000 when buying a home, where the total price of the property is not more than £500,000. 5% is payable on purchases between £300,000 and £500,000. However, with devolved taxes, buying a property in Scotland and Wales can bring different tax consequences.

In Scotland, Land and Buildings Transaction Tax (LBTT) applies instead of SDLT. Therefore an LBTT relief for first-time buyers of properties up to £175,000 has been proposed in the Scottish Draft Budget 2018/19. This is subject to a government consultation before the relief launches in 2018/19.

Welsh first-time buyers benefit from first-time buyers SDLT relief until 31 March 2018. Land Transaction Tax (LTT) replaces SDLT in Wales from 1 April 2018. The starting rate for LTT will be £180,000, benefiting not just first-time buyers but other home buyers in Wales. A higher rate, of 3% over standard rates for additional residential properties, applies to purchases throughout the UK whether SDLT, LBTT or LTT applies. A new land-transaction-tax-calculator is available.

HMRC has issued guidance on the changes in Wales and the transitional rules for property transactions.

Internet links: GOV.UK news GOV.SCOT LBTT first time buyer relief

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