Tax Tips

Please find below all the articles that have been categorised as 'Tax Tips'.

Birthday surprise

Wednesday, April 1, 2015

Do you know when your younger workers will reach their key birthdays: 18 and 21? It is essential to know exactly when these dates fall, as reaching such a milestone will change the level of national minimum wage (NMW) which must be paid to that worker. The current and proposed NMW hourly rates are:

Age or status of employee:	From 1 October 2014	From 1 October 2015
21 and over	£6.50	£6.70
18 to 20	£5.13	£5.30
Under age 18	£3.79	£3.87
Apprentices under 19 or in 1st year	£2.73	£3.30

An employee’s pay must be increased from the beginning of the pay period…

Charities and tax

Wednesday, April 1, 2015

If you help to run a charity you need to keep on top of the tax and audit regulations that apply to charities, and the gift aid scheme.

A person with earnings or pension income of less than £10,600 and interest of up to £5,000 will pay no income tax in 2015/16. These individuals should not make gift aid declarations for donations made on or after 6 April 2015, as they do not pay the income tax which the charity reclaims in respect of that donation.

As a charity you…

Pension freedom or liberation?

Wednesday, April 1, 2015

Pension freedom is a GOOD thing. The change in law from 6 April 2015 means that members of defined contribution pension schemes who are aged 55 or more should be able to draw what they want from their pension schemes. But “pension liberation” is a BAD thing. This is when scammers use confidence tricks to separate taxpayers from their pension savings, and the taxpayer has to pay high charges and tax penalties. Can you tell the difference?

If you are thinking about taking funds from your pension plan, you…

Company cars

Monday, March 2, 2015

Does your company still own or lease the car you use for private journeys? You may need to rethink that arrangement in light of the tax charges due to apply in the years ahead.

From 6 April 2015 all company cars will generate a tax charge for the driver and the employer, even electric cars will be taxed on 5% of their list price. The taxable benefit for other low emission vehicles (51-75g/kg) will leap up from 5% to 9% of the vehicle’s list price. The taxable benefit for…

RTI penalties

Monday, March 2, 2015

Last month we warned you about the penalties coming into effect for late filed RTI reports. The good news is that HMRC are cutting employers just a little slack, and will now allow three extra days in which to submit the full payment submission (FPS) report.

Normally the FPS must be submitted on or before the day the employees are paid, but there are some circumstances in which the FPS can be submitted up to 7 or 14 days later. For example, the FPS can be submitted within 7…

Salary, dividend or pension contribution?

Monday, March 2, 2015

When you work for your own company you can decide how much salary to pay yourself, how much to pay into your pension fund, and what proportion of the remaining profits to take as a dividend. The split is important as it will affect the tax and national insurance payable by you and your company.

A salary just sufficient to be covered by your personal allowance (£10,600 for 2015/16), will be tax free, assuming you have no other income. However, if your company has more than one employee (including…

Unpaid Self Assessment Tax Surcharge Imminent

Wednesday, February 25, 2015

If you have not made arrangements to settle your outstanding self-assessment tax, which was due for payment on 31 January 2015, penalties could be levied by HMRC. In order to avoid a 5% surcharge being levied on your balancing payment for 2013/14, payment will need to be made no later than 2 March 2015. HMRC is taking a very stringent approach with taxpayers with little clemency for late payment. The easiest method to settle the outstanding tax is via…

Mini One Stop Shop (MOSS) – Revision

Saturday, November 1, 2014

This sounds like a friendly retail outlet where you might buy a pint of milk on a Sunday evening. In fact it is short-hand for the online portal which UK businesses should use from 2015 to account for VAT they owe in respect of digital services provided to customers in other EU countries.

We mentioned this new rule in our July 2014 newsletter. “Digital services” includes a multitude of products such as:

– music downloads;
– video on demand;
– electronic books;
– online games;
– anti-virus services;
– software purchased by download;
– charges by…

Don’t Get a Tax Hangover From Your Christmas Party!

Thursday, October 16, 2014

Here at Morgan Hemp we are keen to keep our clients abreast of news, issues and events to help you keep your finances in order and to make sure you are not losing out.

Heading in to the festive period you are probably making plans for a Christmas party. But have you thought about making sure the big annual celebration isn’t a gift to the taxman?

Entertaining your employees can be allowable for tax relief in your business accounts, and it…

Child Benefit, Tax Penalty Ticking Time Bomb

Friday, September 26, 2014

Government changes to child benefit claims for households where at least one person earns over £50,000 can lead to surprise Self-Assessment penalties, if there is a failure to register for Self-Assessment prior to the 5th October 2014 and your circumstances have changed.

Less than two weeks away!

Consider these two scenario’s

1. You or your partner have received a pay increase in the past year taking your employment income in excess of £50,000, and you continue to receive child benefit. You must…