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Paying Class 2 NICs

Whether or not Class 2 National Insurance Contributions (NICs) can be paid depends on whether an individual falls within the definition of a ‘self-employed earner’ for NIC purposes, and if so, whether profits are in excess of the existing small profits threshold (£6,025 for 2017/18).

The definition of a self-employed earner is defined as someone ‘who is gainfully employed in Great Britain otherwise than in employed earner’s employment (whether or not he is also employed in such employment)’ (SSCBA 1992, s 2(1)(b)). A person who is regarded as self-employed…

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New anti-money laundering regulations take effect

The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Pay) Regulations2017 (SI 2017/692) took effect from 26 June 2017 and replace the previous 2007 Regulations with new statutory requirements for systems and procedures. Broadly, the regulations require firms undertaking certain financial activities to apply risk-based customer due diligence measures and take other steps to prevent the firm’s services from being used for money laundering or terrorist financing.

The regulations apply to a number of different business sectors, including financial and credit businesses, accountants and estate agents….

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We’re Proud to Have our Head in the Cloud

Every industry has its moments of great transformation and modernisation, when ‘the way we’ve always done it’ becomes redundant.

With the arrival of cloud-based accounting, our working world is going through a great sea-change and this is something SME owners should be delighted about.

Thanks to the functionality, the transparency and the instant nature of cloud-based accounting, it has never been simpler to see the inner workings of your business, to spot any potential weak points, to take advantage of untapped areas of opportunity, to react nimbly and to plan…

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Is HMRC Knocking? Don’t Be An Ostrich

Few letters will strike fear into the heart of abusiness owner faster than one from HMRC stating their intention to begin an investigation into the firm.

While the problem of tax evasion or aggressive tax avoidance is hardly a new thing, it has perhaps never been as politicised as it is now, and there is a concerted effort on the part of HMRC to crack down – and to be seen to crack down – on those who play fast and loose with taxes.

One  law firm claimed recently…

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Savvy Forward-Planning Will Deliver Succession Success

If you have been at the helm of your own business for some years, nurturing it from germination to becoming a fruitful concern, your thoughts will, at some point, turn to passing it on – and enjoying the rewards of your hard work.

Long before you start to dream about a relaxing retirement sampling the verdant golf courses of the world, you have another very important duty to perform in order to safeguard the long-term vitality of your business – and…

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Mileage rates for electric and hybrid cars

Some confusion has been reported over how businesses should calculate mileage expenses rates for electric and hybrid company cars. This confusion has arisen largely because HMRC’s advisory fuel rates, or approved mileage allowance payments, only cover petrol and diesel cars. There are no separate ‘approved’ rates for electric or hybrid vehicles.

Currently, whilst HMRC do recognise that employees should be reimbursed for costs incurred for business travel, they do not currently recognise electric charging costs as a ‘fuel’ expense and do not therefore, currently publish separate rates.

HMRC’s advisory fuel…

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Switching to the cash basis

Many small, unincorporated businesses choose to use the ‘cash basis’ for working out taxable income. Under this method, participants will be taxed on the basis of the cash that passes through their books, rather than having to undertake complex and time-consuming calculations designed for larger businesses, who generally have to use ‘traditional’ methods for tax purposes. Whilst easing the administrative burdens of preparing ‘traditional’ accounts, using the cash basis can also help with cash flow.

For the 2017/18 tax year onwards, the eligibility income threshold for using the cash…

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SDLT on second homes

Stamp Duty Land Tax (SDLT) is payable on the purchase of residential property in increasing portions of the property price above £125,000.

Current rates of SDLT on individual and additional properties are as follows:
– Purchase price up to £125,000 – SDLT rate Zero; additional property rate 3%
– The next £125,000 (portion from £125,001 to £250,000) – SDLT rate 2%; additional property rate 5%
– The next £675,000 (portion from £250,000 to £925,000) – SDLT rate 5%; additional property rate 8%
– The next £575,000 (portion from £925,000 to £1.5m) – SDLT…

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Paying voluntary NICs

There are various reasons as to why gaps may arise in an individual’s national insurance contributions (NIC) record, for example, because that person has been on low earnings for several years, they have been living abroad, or because they have been unemployed and have not been claiming benefits. In certain circumstances therefore, it may be possible, and beneficial, to pay voluntary Class 3 National Insurance Contributions (NICs) as this can safeguard entitlement to a future state retirement pension and certain other state benefits.

Broadly, voluntary contributions may be paid…

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Workers Rights, The Gig Economy and The Autumn Budget

I suspect that for Philip Hammond, the last budget seems like it happened mere weeks ago. But the thoughts of employers, employees and of all of us concerned with finances and tax are turning to the Autumn Budget 2017.

Budget predictions are proving to be as difficult as predicting election results, so let’s not venture too far down this route.

However, some of the topics that The Chancellor is going to have to address include workers rights and the rights of those working in the ever-growing gig economy.

The issue of…

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