Budgets

De-coding tax codes

Accounting, National Insurance, Payroll, Personal Tax l

Tax-codesA tax code (also known as a PAYE code) appears on every payslip, but do you know what it means and how it is impacting on the net pay you are receiving?

Common tax codes include ‘BR’, ‘1100L’, ‘NT’, and ‘D0’, but what do these mean and what if they are wrong? HMRC expects everyone with a PAYE code to check it but do you and your employees (if you have them) realise this, and know where to start?

A month today – changes to the National Minimum Wage/Living Wage & to the penalties for not complying

Accounting, Budgets, National Insurance, Payroll l

A wage packet– In amongst playing pranks on your nearest and dearest, 1st April 2016 also sees changes to the National Minimum Wage (NMW) and introduction of the National Living Wage (NLW) for employees aged 25 and over.

 

From 1st April 2016 the minimum rates of pay are

– Age 25+ – £7.20 per hour (the National Living Wage)

– 21-25 – £6.70 per hour

– 18-21 – £5.30 per hour

– <18 – £3.87 per hour

– Apprentices – £3.30 per hour

In addition to these changes, the penalty payable by employers who underpay is being increased from 100% to 200% of the underpayment due to each worker.

The good, the bad and the ugly (of the autumn statement)

Accounting, CGT, Law, National Insurance, Payroll, Personal Tax, Property l

goodThe dust has settled on the autumn statement, and it is now clear on the good, the bad and the ugly effecting SME’s, employers and self-employed.

 

The Good!

National Insurance employment allowance increased to £3,000 from April 2016

Extension of the doubling of small business relief rates to April 2017 (good news – make sure you have this if you operate from an office)

The Bad!

3% additional stamp duty land tax will be charged on second homes or investment properties purchased from April 2016, which in added to the reduced relief for interest previously announced from April 2017 is a double hit for active investors

3% differential on Benefit in Kind for diesel cars retained from April 2016 for 5 more years

The Ugly!

Capital gains tax due to be paid within 30 days of completion of any disposal of residential property from April 2019. This ties in with the introduction of digital tax accounts for most taxpayers.

If you have any queries or concerns arising from the autumn statement, contact our team at Morrell Middleton on 01904 691141.

FREE AUTO ENROLMENT & XERO ACCOUNTS SEMINAR (AND LUNCH)

About Us, Accounting, Businesses, National Insurance, Payroll, Pensions, Personal Tax, VAT, Xero l

xero-logo-hires-RGBPension-PeopleAuto Enrolment – everything you need to know about it and the lack of time you have to implement it!

Xero Online Account – How to keep your books sitting on a beach in Hawai whilst drinking cocktails!

Morrell Middleton have teamed up with Ardent Financial advisers to discuss the in’s and out’s of implementing the Governments solution to the pensions crisis – Auto Enrolment.

The rules will apply even to individuals who employ just one person, such as a nanny or gardener. Employers will have to enrol workers who are classified into 3 areas, Entitled Worker, Non-Eligible Jobholder and a Jobholder. Who is which and what you have to do for them is all in our notes!

HMRC new power to issue pay now, investigate later demands

Accounting, Businesses, National Insurance, Personal Tax, Tax/VAT Cases l

Tax calculatorHMRC are reported to be undertaking a targeted campaign against IT and financial services contractors, using the new “accelerated tax demands” to force tax payers into making payments within 90 days, ahead of the tax payer being able to respond.

* Campaign started August 2014

* £1bn collected to date

* £24m already refunded on appeal

* 64,000 notices expected by 2020

HMRC announces £45m to improve customer service

Businesses, Corporation Tax, National Insurance, Personal Tax, Tax/VAT Cases, VAT l

angry-Homer-phoneHMRC has announced today that it is allocating £45m to improve customer service, as it released statistics  indicating a prolonged decline in the quality of its call handling.

The allocation will pay for around 3,000 additional staff to join customer service teams, alongside around 2,000 staff who are being moved over from other parts of HMRC to help with the tax credits deadline and letters and forms.

3 Months Free with Xero accounts and Morrell Middleton

About Us, Accounting, Businesses, National Insurance, Payroll, VAT, Xero l

xero-logo-hires-RGBAs one of Yorks leading Xero accountants we have teamed up with them to offer your first 3 months subscription FREE to existing and new clients of our accountancy practices.

Xero is the UK’s best Online accounting solution so for those people who operate on the move, have different locations for staff or just want less hassle in their book keeping lives then this may be a solution for you.

The end of Class 2 NIC via Direct Debit

Budgets, National Insurance, Personal Tax l

NI StampsMany people still refer to these contributions as “stamps” from the days when you actually bought a National Insurance stamp from the Post Office to stick on a card.

Nowadays the flat rate of £2.75 per week is paid either by monthly or 6 monthly direct debit, in arrears, or on receipt of a bill from HMRC.

With effect from year 2015/2016 your Class 2 NICs liability will be established within your Self Assessment Tax Return and will be payable alongside Income Tax and Class 4 NICs which are based on the level of profits from self employment.

The final direct debit payments will be taken on 10 July 2015 for the period ended 11 April 2015.

No Employer’s NIC for employees aged under 21

Accounting, Businesses, National Insurance, Payroll, Uncategorized l

under21With effect from 6 April 2015 employers with employees under 21 years old will no longer have to pay Class 1 secondary National Insurance contributions (NICs) on earnings up to the Upper Secondary Threshold (£815 per week) for those employees.

You will need to record a different NI category letter for any such employees. Current category A will be replaced by category M until the employee’s 21st birthday.

There is no effect on the NICs payable by the employee.

National minimum wage increases from 1 October 2014

Accounting, Budgets, Businesses, Growth, National Insurance, Payroll, Personal Tax l

A wage packetDon’t get caught out by the increases in National Minimum Wage which come into place from 1 October 2014.

It is also important where you have younger employees, to ensure that you make sure they get the paid at least the minimum rate as they go through the age brackets, and as an employer you don’t become guilty of paying less than minimum wage.

Full details of the rates can be found at https://www.gov.uk/national-minimum-wage-rates

Key dates for your diary

About Us, Accounting, Businesses, Clients News, Corporation Tax, Growth, National Insurance, Payroll, Personal Tax, Tax/VAT Cases, VAT l

DiaryAs a self-employed person, or someone who is running a business every day is important. However, some dates should be in your diary to ensure that you don’t fall foul of HM Revenue & Customs or Companies House.

We’d recommend having the following dates in your business diary as reminders of tasks which need to be done.

Are you next on the taxman’s hitlist?

Accounting, Auditing, Businesses, CGT, Corporation Tax, IHT, Investments, National Insurance, Payroll, Pensions, Personal Tax, Property, Shares, Tax/VAT Cases, VAT l

Arthur DaleyTax crackdowns have arrived thick and fast in the past three years. Officials have targeted everyone from doctors to Avon ladies to claw back £35bn lost in unpaid tax each year – and more inquiries are in the pipeline.

Accountants claim that HM Revenue & Customs focuses on “soft targets” through special task forces that investigate specific job sectors.