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hart parry blog

Making Tax Digital

It is just 7 weeks until HMRC start their pilot scheme of Making Tax Digital (MTD), this is where as a minimum businesses will be required to report their figures each quarter rather than annually as now.  The full system is due to be rolled out from 6 April 2018 – Sole Traders and Landlords being the first to be mandated to do this, followed the next year by partnerships and lastly limited companies  by 2020. There is still a lot of detail to be resolved, and we are already busy planning what we need to do to help you be compliant with the new system.  We will be requesting your assistance in due course, in making it possible for your returns to be both accurate, on time and without penalty.  There may need to be changes to the way you keep your records, both to meet the new regulations and also to help us be able to meet the new deadlines for you. For those of you that are VAT registered, you are already a long way there, and it will not be such a big change, and by 2019 your VAT return and Making Tax Digital returns will be one and the same, HMRC have indicated their intention to combine the 2 returns – so watch this space – lots of changes ahead – we are here to help you smoothly through them. VAT Flat Rate Scheme changes The government considers that some businesses with ‘limited costs’ are obtaining too much advantage in using FRS as, although they correctly use the flat rate appropriate to their trade...

Christmas Opening Hours

The office will close at 4 pm on Friday 23 December. The office will re-open at 9 am on Tuesday 3 January. We would like to wish all our clients a very Merry Christmas and a Happy, Health and Prosperous New Year from all the team at Hart Parry. If there is anything urgent during this period, please contact us by email and we will try to...

Newsletter Winter 2016

The Autumn Statement is set to be an important event. We have a new Prime Minister and Chancellor of the Exchequer with a potentially different slant on economic policy than their predecessors. There is also the need to deal with the impact of Brexit. A busy time ahead for our tax system HMRC are proposing a number of short term and long term changes to our tax system. Over the summer, HMRC issued over 30 consultation documents. Many of these are technical in nature but there are some big themes being aired. Chief among these are the proposals related to the Making Tax Digital project. Six of the consultation documents cover different aspects of the project at the heart of which lies the desire to allow all personal and business taxpayers to engage with HMRC online and for taxpayers to see up to date and accurate information on their tax bills throughout each tax year. Three of the consultation documents contain proposals to tackle the hidden economy. In 2013/14, the hidden economy ‘tax gap’ was £6.2 billion and HMRC are tasked with reducing the size of that gap. We will keep you up to date with tax changes that may impact upon you and your business as these develop beyond the consultation stage.   Financial accounts for small companies – time to choose Most of our client companies have been preparing and filing ‘small company accounts’ under a Financial Reporting Standard for Small Entities (FRSSE). However for financial years beginning on or after 1 January 2016, FRSSE has been withdrawn and small companies, which qualify as ‘micro-entities’, have a...

Newsletter Autumn 2016

Sorting out interest receipts On 6 April 2016 a new allowance – the Savings Allowance – was introduced into our tax system. The Savings Allowance applies a new 0% rate for up to £1,000 of interest receipts for a basic rate taxpayer and up to £500 for a higher rate taxpayer. The introduction of the Savings Allowance will mean that the majority of taxpayers will not pay tax on their interest. The government has therefore removed the requirement (from 6 April 2016) for banks and building societies to deduct tax from account interest they pay to customers. This has not been extended to private companies paying interest on directors loan accounts so the CT61 regime still applies and basic rate tax will still be deducted at source from some forms of savings income such as interest distributions from unit trusts and OEICs. The government proposes to remove this requirement from April 2017. Of course if your interest income exceeds the Savings Allowance, there will be extra tax to pay and if you are a higher rate taxpayer, you are more likely to be in this position as the Savings Allowance is only £500. Brexit and tax The EU referendum result will, of course, have significant long term economic consequences for the UK and many areas of law will need to be adapted to the new era. What are the possible tax consequences of the UK ceasing to be a member of the EU? The main point to note is that many areas of taxation such as personal and corporate tax rates have been matters which the UK has been...

Newsletter Summer 2016

Minimum Wage rates increases rescheduled The National Living Wage (NLW) came into effect in April 2016 for workers aged 25 and over and has caused many businesses to consider their remuneration policies for employees. The initial rate of £7.20 is a 50p increase in the rate that used to apply. In terms of detailed rules, the NLW is really just a new category rate for the National Minimum Wage (NMW). However there is an important difference of principle in the setting of the rates. Changes to the NMW rates have been recommended by the Low Pay Commission in an annual report. Amongst the 368 pages of the latest report are the recommendations for changes to the NMW rates to apply from 1 October 2016. The rate for 21 to 24-year-olds will increase by 25p to £6.95 for example. The Commission will continue to recommend rates for those aged under 25 and apprentices that will not damage the employment prospects of these groups. It will also recommend rates for NLW but focused on the government target of reaching 60% of median earnings by 2020 (on latest forecasts this would mean £9 in 2020). The government has announced that the NMW and NLW cycles will be aligned with effect from April 2017 so that both rates are amended in April each year. Four reasons to add social media to your marketing plan The use of social media in businesses has rocketed over the last few years as it is a great way to communicate with a wide audience. If you’re not an active user you could be missing out on vital...