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Don’t Get Caught Short When It Comes to Retirement

More and more people – particularly in Wales – are self-employed, but according to recent figures* only eight percent of self-employed workers aged 25 to 34 are saving into a private pension.

This is compared with 59 percent of employees in the same age group who are contributing to their pension pot.

This is a worrying state of affairs, since UK-wide figures show self-employment has grown by 46 percent since 2000 and if this upward trend continues the self-employed could outnumber public sector workers by 2020.

While many enjoy the…

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February key tax dates

2 – Last day for car change notifications in the quarter to 5 January – Use P46 Car

19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/2/201

28 – First 5% penalty surcharge on any 2015/16 outstanding tax due on 31 January 2017 still unpaid

– Talk to us about year end and pre-budget planning

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February Questions and Answers

Q. Due to unforeseen circumstances I have recently had to sell my house and down-size to a smaller property. I sold the house for £20,000 less than I paid for it. Can I offset this loss against income from my business and reduce my income tax liability for this year?

A. Unfortunately the tax law does not permit you to do this. I am assuming that you are not trading in properties and the house was either your main residence or an investment asset. Losses on the sale of…

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Coming soon: tax-free childcare

Plans for the introduction of a new scheme called ‘tax-free childcare’ were initially announced way back in the 2013 Budget. The original proposals have since been amended and the scheme is now set to be implemented during 2017. Broadly, the new scheme, which aims to help working parents with the cost of childcare, will replace the current system of employer-supported childcare (ESC) which is offered by less than 5% of employers and used by around 450,000 families.

Parents will be able to open an online voucher account with a…

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Employers beware of plans to change Scottish income tax threshold

Shortly before Christmas, the Scottish draft budget contained an announcement that Scottish taxpayers will start paying the 40p higher rate of income tax at a lower point than taxpayers elsewhere in the UK. This announcement means that businesses across the UK, not just in Scotland, will need to review their payroll systems to ensure that the proposed change can be accommodated.

Scotland’s Finance Secretary Derek Mackay confirmed that the Scottish Government intends to restrict increases in the rate at which people start paying the higher rate of income tax…

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HMRC’s Tougher Approach to Offshore Tax Evasion

HMRC have implemented various measures over recent years designed to encourage those not paying the right amount of tax across their offshore tax affairs to make full disclosures. Whilst there has been a positive approach to the facilities provided, HMRC have recently reminded taxpayers that things are about to get even tougher for those who try to hide investments offshore.

To date, over 100 countries have committed to exchange information on a multilateral basis under the Organisation for Economic Co-operation and Development Common Reporting Standard (CRS) ,which means that…

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Treasury Committee Urges Caution On Making Tax Digital Implementation

Back in January 2016 we talked about the Government’s Making Tax Digital initiative – the £1.3 billion overhaul of HMRC to transform it into one of the most digitally advanced tax administrations in the world by 2020.

It was intended that by April 2016 each individual and small business would have access to their own secure digital tax account allowing them to interact with HMRC digitally and begin digital reporting for income tax and National Insurance.

So far, so 21st century.

However, as Shakespeare almost said, the course of simpler…

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January Questions and Answers

Q. My husband and I jointly own and run a restaurant. We have both, in the past, faced heavy financial losses due to divorce and we don’t wish to be in this situation in the future. What should we do to safeguard both of our interests in the event of a marital split?

A. Some may think this is an unromantic approach, but knowing your interests are safeguarded can give you both real peace of mind and allow you to get on with your lives without nagging worries about the future.

If…

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January key tax dates

1 – Due date for payment of Corporation Tax for the year ended 31 March 2016

14 – Return and payment of CT61 tax due for quarter to 31 December 2016

19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/1/2017 or quarter 3 of 2016/17 for small employers

31 – Deadline for filing 2016 Self Assessment personal, partnership and trust Tax Returns – £100 first penalty for late filing even if no tax is due or tax due is paid on time

– Balancing self assessment payment due…

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January questions and answers

Q. I am thinking of renting out a small outbuilding that I own to a friend so that he can store his work equipment in it when he’s not using it. The rent is likely to be less than £1,000 a year. Will I have to declare this income to HMRC on a self-assessment return? My tax affairs are quite straight-forward – I am employed and currently I don’t need to send in a tax return.

A. Two new annual tax allowances of £1,000 each are being introduced from…

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