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Business Tax News

Wrong 2010 Tax Codes

Revenue have issued the wrong tax codes to millions of taypayers for 2010/11. Please check your coding notice carefully, with no change in the personal allowance this year your code should be similar to that of 2009/10. Revenues’ new computer system is picking up employments from prior years that you may no longer have, incorrectly coding employment benefits and in some cases not giving sufficient personal allowances for older tax payers.

Please call or email us if you would like help with this issue, the onus is on the tax payer to check their own coding notices for errors and not doing so could result in additional tax being paid in the 2010/11 tax year.

February 2010

December 2009 Pre-budget Report

Darling unveils measures to 'secure recovery'

Chancellor Alistair Darling has presented the 2009 Pre-Budget Report, to a politically charged House of Commons. In the context of the global recession, and with a General Election looming, this year's statement has particular significance.

» Read the full report

December 2009

Forthcoming VAT and PAYE Changes

You may be aware that there are a few changes coming into force over the coming months, some of which may be relevant to your company. We thought we would highlight a few of the important ones.

• Change of VAT rate - VAT reverts to 17.5% from January 1st 2010
• Changes to the way that businesses file VAT returns from April 1st 2010
• PAYE Late Payment Penalties
• New National Minimum Wage Rates

November 2009

Statements of Account - July 2009

Second payment on account due 31 July. The Revenue has recently installed a new computer system which has affected the production of statement reminders for the second payment on account for self-assessment clients. No statements will be issued for the July payment. When queried with Revenue we were told that the legislation states that clients should know how much they need to pay and make the payment accordingly – not sure how you do that with no payslip or bank details!

Please call the office if you need help with this.

July 2009

Small company dividends

From March 2006 the tax advantage of the self-employed turning themselves into Limited Companies reduced slightly; in April 2008 the advantage was reduced further with the rise in the Corporation Tax rate for the first £300,000 of profits to 21% - but is still worthwhile. The current net effect is that dividends taken on taxable profits lower than £300,000 will have been taxed at a 21% tax rate but this compares with a 28% effective tax rate for the self employment (being 20% income tax plus 8% National Insurance). This works on each shareholder in the business where they have earnings up to the higher rate tax threshold. Above the higher rate tax band rate the difference is marginal, so we work with you to seek to avoid that happening!

Updated July 2009

New powers for Revenue to visit Business Premises

From 1 April 2009 Revenue & Customs can visit your place of business and ask to see your tax and accounting records without warning. This applies to all taxes - VAT, Corporation Tax, CIS and income tax and for current and prior years. Revenue will have absolute right of access to statutory records under the new regime and businesses will not be able to appeal.

There are also new penalties if Revenue consider you are not taking reasonable care with your tax affairs ranging from 30% - 100% of any additional tax due.

If we can help in reviewing your current accounting procedures please call.

March 2009

Late filing penalties

Company Directors – Companies House has imposed new fines from year ends from April 2008. The new regime is effective from 1 February 2009.

In a move to encourage companies to file their accounts on time penalties are being increased significantly and time frames between penalty rises are shorter.

In addition where there was a failure to comply with filing requirements in relation to the previous financial year (and that the previous financial year had begun on or after 6 April 2008), the penalty will be double that shown in the table.

The new scales are as follows:

The penalties also apply to dormant companies.

February 2009

Tax payments became due on 31 January

Having problems paying your tax bill? As part of the Governments initiative to help businesses in the current financial crisis a new dedicated Business Payment Support Service has been set up. If overdue payments are causing you problems call them on 0845 302 1435, have your tax reference to hand together with details of current business income and expenses. They will review your circumstances and wherever possible will agree to spread the payments over a longer period. No late payment surcharges will be applied but interest will be charged until the liability is settled in full. For more information please call us.

Updated February 2009

Surviving the Credit Crunch

Barely a day goes by without a news story about the struggling economy, and you may be concerned about how your business will cope in the so-called 'Credit Crunch'...

» Download our information sheet...

November 2008

National Minimum Wage

From 1st October 2008, the National Minimum Wage increased to £5.73 an hour for staff aged 22 and over; the rate for those aged 18 to 21 increased to £4.77 an hour with the rate for those aged 16 and 17 increasing to £3.53 an hour.

Updated September 2008

Audit Limits

In 2004 the audit exemption limit rose to £5.6m (from £1m) and has at last moved again after constant mutterings in government. The 2004 change was estimated to save businesses over £60m per year in accountant's fees so the new change will no doubt help too!

In 2008 the audit exemption limit rose for accounting periods starting on or after 6th April 2008. Companies (or groups) with an annual turnover of less than £6.5m (previously £5.6m), and assets less than £3.26m (previously £2.8m) are exempt from audit requirements – those above require a UK statutory audit.

The limits for defining "small" companies also rose to the audit thresholds - these limits are relevant in order to claim higher rate capital allowances.

Updated May 2008

Annual Leave

From 1 October 2007 the minimum entitlement changed from 20 days to 24 days (if the employee works a 5 day week) and from 1 April 2009 it will  change again to 28 days. This can include the 8 bank holiday days.

Part-time workers are entitled to the same leave pro rata.

Updated January 2008

Capital Allowances

Capital Allowances for the tax year 2007/08 are 50% in the year of expenditure for all types of plant and equipment including IT expenditure.

There are changes from April 1 2008, predominantly amongst these are 100% allowances for all expenditure to £50,000 in a year and 20% thereafter. Writing Down Allowances are also reduced to 20% from this date.

The future allowances for low CO2 emission cars and energy efficient equipment currently allowable at 100% are currently unknown.

Updated January 2008

Use of home allowances.

The Revenue has agreed that up to £156 per year may be claimed for home working without supporting evidence.

06/10/03

Money Laundering

Within the Proceeds of Crime Act, accountants, auditors, estate agents, tax advisors and other professionals have to report any suspicious transactions under the 1993 Money Laundering Regulations. If we are called upon to do this we also cannot advise you of what we are doing...