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Brexit legislation update

The House of Commons Library has published two research briefing papers entitled Brexit timeline: events leading to the UK’s exit from the European Union and Legislating for Brexit: the Great Repeal Bill.

The Brexit timeline paper provides a timeline of the major events leading up to the referendum and subsequent dates of note, looking ahead to expected events as the UK and EU negotiate Britain’s exit. The Queen’s speech at the State Opening of Parliament, scheduled for 19 June 2017, will include the Great Repeal Bill in…

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Automatic enrolment for pensions

To encourage workers to start building up retirement benefits, the Pensions Act 2008 introduced certain reforms requiring all employers to offer workplace pension schemes and to enrol eligible workers into their schemes. These reforms are commonly known as the ‘automatic enrolment’ provisions. Automatic enrolment is currently being phased in, starting with the largest UK employers – eligible employees should have been enrolled by 1 February 2018 at the latest. By October 2018, all existing employers will be required to offer workplace pensions to eligible workers.

Broadly, ‘eligible workers’ are…

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VAT Flat rate scheme: changes take effect

The VAT flat rate scheme (FRS) is used by many small businesses to help simplify their VAT reporting obligations. Businesses could often gain a cash advantage from using the scheme, but this advantage has been significantly curtailed from 1 April 2017, particularly in relation to service-related businesses. Whilst the FRS continues to operate, many businesses will no longer find it economical to use.

Broadly, the FRS is a simplified VAT accounting scheme for small businesses, which allows users to calculate VAT using a flat rate percentage by reference to their…

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May key tax dates

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

19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/5/2017

31 – Deadline for copies of P60 to be issued to employees for 2016/17

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Tax-free savings update

Although interest rates for savings generally remain low, there are still a few tax-efficient savings opportunities on offer, with increased savings thresholds taking effect from 6 April 2018.

Individual Savings Accounts

Broadly, cash ISAs are available to investors aged 16 and over, who are resident in the UK, and stocks and shares ISAs are available to UK-resident individuals aged 18 and over. The maximum annual investment limit has been raised to £20,000 from April 2017, which means that a couple can now invest up to a sizeable £40,000 for 2017/18….

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HMRC launch consultation on employee expenses

As confirmed the Spring Budget 2017, HMRC have launched a consultation on the use of the income tax relief for employees’ business expenses, including those that are not reimbursed by their employer. The main objectives of the consultation, which will run until 12 June 2017, are to understand:

– if the current rules or their administration can be clearer and simpler;
– whether the tax rules for expenses are fit for purpose in the modern economy; and
– why the cost to the exchequer of the tax relief for expenses which are…

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May questions and answers

Q. My company owns a car which is used during the day by various employees for business travel only. However, since there is no overnight parking facility at our business premises, one of my employees takes the car home each night and parks it outside his house. He does not use the car privately. Am I correct in assuming that no taxable benefit arises?

A. Unfortunately not. To qualify for exemption under the pool car rules, the vehicle must not normally be kept overnight on or near the residence of…

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Making Tax Digital –  Gone But Not Forgotten

The much-scrutinised Making Tax Digital (MTD) programme has been dropped from the Government’s Finance Bill 2017 in the run-up to the General Election, in a move that is likely to please some small business owners. However, nobody doubts that MTD will return in the next Parliament.

In some ways this action is simply a political technicality being played out. These are the last few days of Parliament before dissolution, prior to the imminent General Election, so Public Bills must be passed or scrapped – they cannot simply be…

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Making Tax Digital Should Be Xero Hassle

While there have been a few bumps in the road on the way to Making Tax Digital (MTD) its introduction is proceeding apace and it is something all businesses need to take on board.

The new system shouldn’t hold too many fears for business owners. However, all accountants have those clients who arrive at the door once a year with a carrier bag full of receipts and a sheepish look on their face. These business owners will need to adjust their approach to accounting, since MTD will compel…

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April key tax dates

5 – End of 2016/17 tax year. Last day to use up your annual exemptions for capital gains tax, inheritance tax and ISA’s

6 – Start of the 207/18 tax year

14 – Return and payment of CT61 tax due for quarter to 31 March 2017

19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/4/2017 or quarter 4 of 2016/17 for small employers. Interest will run on any unpaid PAYE/NIC for the tax year 2016/17

30 – Additional daily penalties of £10 per day up to a maximum of £900 for failing to…

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