Uncategorised

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

CGT annual exemption: use it or lose it!

Thursday, June 1, 2017

Capital gains tax (CGT) is normally paid when an item is either sold or given away. It is usually paid on profits made by selling various types of assets including properties (but generally not a main residence), stocks and shares, paintings, and other works of art, but it may also be payable in certain circumstances when a gift is made.

The most common method for minimising a liability to capital gains tax is to ensure that the annual exemption is fully utilised wherever possible. Whilst this is relatively straight-forward…

IHT: main residence nil-rate band

Thursday, June 1, 2017

From April 2017, each individual spouse or civil partner will be offered a residence nil rate band (RNRB), which is designed to help pass on a home to ‘direct descendants’, including children or grandchildren, tax-free after their death. The rules governing the inheritance tax (IHT) nil rate band are complex and it is always recommended that prior professional advice is considered.

Phasing in of RNRB

The RNRB is being phased in over a four-year period as follows:

– £100,000 in 2017-2018
– £125,000 in 2018-2019
– £150,000 in 2019-2020
– £175,000 in 2020-2021

Broadly, the…

Reform of landlords’ taxation?

Thursday, June 1, 2017

The government’s plans to allow landlords to use the cash basis for tax purposes were confirmed in the 2017 Spring Budget, but although the proposed legislation was included in Finance Bill 2017, it did not appear in the much reduced Finance Act 2017, which received Royal Assent on 27 April 2017. It is likely that the proposals have been temporarily shelved, pending the outcome of the General Election, and are expected to reappear in a second Finance Bill later this year. If the provisions are subsequently enacted, they…

Brexit legislation update

Thursday, June 1, 2017

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…

Automatic enrolment for pensions

Monday, May 1, 2017

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…

VAT Flat rate scheme: changes take effect

Monday, May 1, 2017

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…

May key tax dates

Monday, May 1, 2017

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

Tax-free savings update

Monday, May 1, 2017

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….

HMRC launch consultation on employee expenses

Monday, May 1, 2017

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…

May questions and answers

Monday, May 1, 2017

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…