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CGT tax-free allowance reducing

24/11/2022

In the Autumn Statement, the Chancellor announced that the annual exempt amount applicable to Capital Gains Tax (CGT) is to be more than halved next year. This rate had previously been fixed at £12,300 from April 2021 to April 2026 for individuals, personal representatives, and certain trusts for disabled people. The exempt amount will...

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Personal tax allowances frozen to April 2028

24/11/2022

Chancellor Jeremy Hunt announced as part of the Autumn Statement measures that the Income Tax thresholds will be maintained at their current levels for a further two years until April 2028. This will see the personal tax allowance frozen at £12,570 through to April 2028. The existing thresholds for the basic rate and higher rates of tax...

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Corporation Tax increases from April 2023

24/11/2022

The Corporation Tax main rate will increase to 25% from 1 April 2023 for companies with profits over £250,000. A Small Profits Rate (SPR) of 19% will also be introduced from the same date for companies with profits of up to £50,000 ensuring these companies pay Corporation Tax at the same rate as currently. Where a company has profits...

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CGT – share exchange

24/11/2022

One of the more ‘niche’ measures introduced as part of the Autumn Statement measures related to Capital Gains Tax: Share for Share Exchange. This is intended to stop UK tax being avoided by non-UK domiciled individuals on chargeable gains made on the disposal of a UK business, or income received in respect of shares or securities held...

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MTD for ITSA

24/11/2022

The introduction of Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA) is set to commence from April 2024. This means that clients who have not yet prepared for the change have less than 18 months to choose and begin using approved software. MTD for ITSA will fundamentally change the way businesses, the self-employed and...

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Reminder of working from home allowances

24/11/2022

Employees who work from home may be able to claim tax relief for bills they pay that are related to their work. Employers may reimburse employees for the additional household expenses incurred through regularly working at home. The relief covers expenses such as business telephone calls or heating and lighting costs. Expenses that cover...

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Fiscal drag

21/11/2022

You may have encountered this phrase, fiscal drag, in recent weeks, particularly if following the Autumn Statement announcements last week. A large part of Chancellor Hunt’s announcements confirmed that rates and allowances for Income Tax are to be frozen at current levels until April 2028. Your immediate response to this news may have...

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Tax Diary December 2022/January 2023

21/11/2022

1 December 2022 - Due date for Corporation Tax payable for the year ended 28 February 2022. 19 December 2022 - PAYE and NIC deductions due for month ended 5 December 2022. (If you pay your tax electronically the due date is 22 December 2022). 19 December 2022 - Filing deadline for the CIS300 monthly return for the month ended 5 December...

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Autumn Statement Summary

17/11/2022

The new Chancellor of the Exchequer, Jeremy Hunt, has delivered his Autumn Statement to the House of Commons against a backdrop of a worsening cost of living crisis and with confirmation from the Office for Budget Responsibility OBR that the UK has now entered into a recession. The OBR has stated that the economy is still forecast to...

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Basis of assessment changing

17/11/2022

Forthcoming 'basis of assessment' reforms will change the way trading income is allocated to tax years for the self-employed. The changes will affect sole traders and partnerships that use an accounting date between 6 April and 30 March. There is no change to the rule for companies. The reforms will change the basis period from a...

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More on HMRC payment plans

17/11/2022

Businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service. An online payment plan for Self-Assessment tax bills can be used to set up instalment arrangements for paying tax liabilities up to £30,000....

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Declare COVID support payments received

17/11/2022

HMRC is reminding Self-Assessment taxpayers that they must declare COVID-19 grant and support payments in their tax return for the 2021-22 tax year. Most COVID support scheme grants are treated as taxable income in the same way as other taxable receipts and need to be reported to HMRC. This means that if you received a taxable support...

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VAT – partly exempt businesses

17/11/2022

A business that incurs expenditure on taxable and exempt business activities is partially exempt for VAT purposes. This means that the business is required to make an apportionment between the activities using a 'partial exemption method' in order to calculate how much input tax is recoverable. Businesses that make both taxable and...

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Private pension contributions tax relief

17/11/2022

Under current rules, you can claim tax relief for your private pension contributions within certain limitations. The current annual allowance for tax relief on pension contributions is £40,000. You can also carry forward any unused amount of your annual allowance from the last three tax years if you have made pension savings in those...

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Gifts paid out of disposable income

17/11/2022

It is possible for wealthier taxpayers to make tax exempt gifts and payments that are funded as normal expenditure out of income. This is a very flexible exemption from IHT as there are no specific requirements, for example by making fixed regular gifts to the same person. With proper planning this can be a very useful tool including...

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Tax on dividends

10/11/2022

The dividend tax allowance was first introduced in 2016 and replaced the old dividend tax credit with an annual £5,000 dividend allowance. Tax was payable on dividends received over this amount. The tax-free dividend allowance was reduced to £2,000 with effect from 6 April 2018 and has remain fixed at that level ever since. This means...

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