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Autumn Budget 22 November 2017 – Key Points

Hammonds ‘Balanced approach’ – the key points:

 

Business

  • £500m to go towards a 5G mobile network, fibre broadband and AI
  • 1% increase in Benefit in Kind on diesel company cars
  • Vehicle Excise Duty to go up by 1 band from 2018 on cars that don’t meet the standard

 

Northern Ireland

  • Extra £650m to be available to NI executive

 

Living Wage

  • From April 2018 Living Wage to increase from £7.50 to £7.83

(4.4% increase)

 

Excise duty on cigarettes & Alcohol

  • Minimum duty on cigarettes will increase by 2% above retail price index
  • Duty on most ciders, wines, beers and spirits will be frozen
  • High strength white ciders to be increased

 

Fuel duty

  • Fuel duty rise scheduled for April 2018 has been cancelled – Fuel duty will now be frozen

 

Taxation

  • Personal tax free allowance to increase to £11,850 from April 2018
  • Basic rate tax band to be extended – 40% tax threshold rises to £46,350 from April 2018
  • 1% increase on Benefit in Kind on diesel company cars

 

 

VAT

  • VAT registration threshold will not be reduced for the next two years, and will be maintained at £85,000.
  • Clamp down on VAT fraud committed by on-line retailers

 

Property

First-time buyers – stamp duty abolished on homes up to £300,000.

 

Technology

 

    • £20bn of new investment in UK knowledge-intensive industries.
    • £2.5bn from the business bank.
    • Encourage pension fund investment
    • Boost to Enterprise Investment Schemes.
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Key Points Spring Budget 2017

The Spring budget was presented by Mr Philip Hammond on 8th March 2017.

 

A summary of the main points are noted below:

 

  • Class 4 National Insurance to increase from 9% to 10 % in April 2018 and to go up to 11% in April 2019. All class 4 earnings above £43,000 will continue to be taxed at 2% while those below £8,060 will continue to pay nothing.
  • Class 2 National Insurance for workers making a profit of over £5,965 is to be scrapped as planned in April 2018
  • Dividend Allowance to reduce from £5,000 to £2,000 from April 2018
  • Dividend income paid on shares held in a stocks and shares ISA will remain tax free
  • Making tax digital – Privately owned SMEs to get an extra year to prepare for digitalisation and quarterly reporting
  • £100m to be made available to place more GPS in A&E departments for next winter
  • £5m to be made available for ‘return ships’ – helping people back to work after a career break
  • New T levels to be introduced to give parity of esteem for technical education
  • Over all Isa savings limit will increase from £15,240 for 2016/17 to £20,000 for 2017/18

 

In addition to the above, Mr Hammond also addressed the following items which have been previously announced:

 

  • Personal Allowances to be increased to £11,500 this year and to £12,500 by 2020
  • Basic Rate tax band to be increased to £33,500 for 2017/18, meaning the higher rate 40% tax band will now take effect on income over £45,000 (different for those resident in Scotland)
  • Corporation tax rate to be reduced to 19 % for years beginning 1 April 2017, 1 April 2018, and 1 April 2019 and to 17% for the financial year beginning 1 April 2020
  • Corporation tax loss relief –from 1 April 2017 large companies will only be able to use losses carried forward against up to 50% of their profits above £5m. For groups, the £5m will apply to the group
  • Inheritance Tax – The nil rate band remains at £325,000. New deemed domiciled rules apply from 6 April 2017 for inheritance tax, income tax and capital gains tax
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Married Couples Allowance

Transfer unused tax allowance to save up to £212.00 in tax year 2015/16

If you are a married couple or are in a civil partnership, you may qualify for couples tax relief worth up to £212 in 2015/16.

Who does this apply to?

This tax relief is available to married couples and couples in a civil partnership where one partner earns less than £10,600 and the other partners income is below the 40% tax threshold.

One of us is self employed, are we still eligible?

This tax relief is available whether your income is from employment, self-employment, pension income, savings or a combination of these; provided your total income is within the allowable bands.

The 2015/16 tax year is nearly over, can we still apply?

Yes. You can register your interest with HMRC by clicking on this link https://www.gov.uk/marriage-allowance. If you register before the end of the current tax year, and you and your partner qualify, then you can claim entitlement for the full tax year.

How will we know if we are eligible?

1. To benefit from the Married Couples Allowance the higher earning partner/ spouse must have earnings of between £10,601 and £42,385 in the 2015/16 tax year.
2. Both members of the couple must have been born on or after 6 April 1935. There is a slightly different allowance available if you were born before this date.
3. The lower earning partner/ spouse must earn less than £10,600 in the 2015/16 tax year. The maximum relief will be available where the lower earning partners total taxable income is £9,540, or lower in 2015/16. If the lower income earning partners income falls between £9,540 and £10,600, then the amount of relief available to transfer across to the higher earning partner/spouse will be reduced accordingly.

If you would like to more about how this tax relief might benefit you please contact us at JSR Chartered Accountants.

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Budget 2016 – Key Points

Sugar levy on soft drinks

This aims to raise £520m in a two-part levy on companies – one for total sugar content above 5g per 100ml and one for drinks with more than 8g per 100ml – to be introduced in two years’ time. Pure fruit juice and milk are excluded. It will be used to fund sport and longer school days.

Tax allowance

  • An increase to £11,500 by next April.
  • A reiterated target to reach £12,500 by 2020. (It will be £11,000 from this April.)
  • An increase in the 40p tax threshold to £45,000 from next April. (£43,000 from this April.)

 

Savings

  • Tax relief on financial advice.
  • “Help to save” for lower income savers.
  • From April an increase in the Isa limit to £20,000.
  • A new lifetime Isa for £4,000 of savings.

Fuel duty

Frozen for the sixth consecutive year, saving £75 for the average driver.

 

Oil and gas

The industry gets £1bn of tax cuts as the supplementary charge on oil and gas is cut from 20% to 10%.

 

Climate change

  • An increase in the climate change levy from 2019.
  • An end to the carbon reduction commitment energy efficiency scheme.
  • £730m to back renewables.

 

Growth

Revised down for 2016 to 2% compared with 2.4% at the time of the autumn statement for 2015 and 2016, and revised down to 2.2% in 2017 (2.5%) and 2.1% in each year after that (previous forecasts for 2.4% in 2018 and 2.3% in each of 2019 and 2020).

 

Inflation target

The remit remains at 2% for the monetary policy committee and the Bank of England is asked to be particularly vigilant in the face of market turbulence.

 

Cuts

The chancellor is aiming for a further £3.5bn of savings in 2019-20.

Deficit

A surplus of £10.4bn is predicted in 2019-20 and then £11bn the year after.

 

Tax avoidance

  • £12bn to be raised over this parliament, including by cracking down on the royalty payments that firms use to shift money to tax havens.
  • This also includes efforts to stop individuals disguising their income as loans and imposing national insurance on termination payments over £30,000 from 2018.

 

Corporation tax

Cut to 17% by April 2020.

But banks are to be hit by restrictions on the amount of profit that they can offset against losses.

Northern Ireland is set to introduce a Corporation tax rate of 12.5% in 2018.

Business rates (England and Wales)

  • The threshold for small business rate relief is to increase from £6,000 to £15,000.
  • From April next year 600,000 small businesses will pay no business rates.
  • London gets full retention of its business rates next April, three years earlier than planned.

 

Stamp duty

To raise £500m a year, from Thursday, commercial stamp duty will be zero on properties up to £150,000 and 2% on the next £200,000, but a top rate of 5% on £250,000.

Homelessness

£115m to reduce rough sleeping.

 

Flood defences and insurance

A £700m increase for flood defences and a 0.5% increase in the insurance premium tax to 10%.

 

Culture

  • Cathedral repairs fund gets an extra £20m.
  • Tax breaks for galleries that go on tour.

Education (England and Wales)

  • Schools to become academies.
  • Focus on northern schools.
  • Teaching maths to 18 for all pupils.
  • £500m for national funding formula.

Tobacco

Tobacco Duty will rise by 2% and hand rolling tobacco will rise by an additional 3% from 6pm on 16 March 2016

 

Alcohol

Duty on beer, cider and whisky is frozen.

 

Capital gains tax

For commercial properties the higher rate of Capital Gains Tax will be cut from 28% to 20% and the basic rate from 18% to 10%. This will take effect from April 2016., but no change for properties.

 

Overseas aid budget

Budget will be “readjusted”, saving £650m in 2019-20.

Pensions

Increase in contributions from public sector employers.

 

Self Employed National Insurance

Class 2 National Insurance contributions to be scrapped for self-employed workers from April 2018. Currently, self-employed people have to pay Class 2 NICs at £2.80 per week if they make a profit of £5,965 or over per year. They also pay Class 4 NICs if their profits are over £8,060 per year. From April 2018, they will only need to pay one type of National Insurance on their profits, Class 4 NICs

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National Living Wage

From the 1 April 2021 the National Living Wage (NLW) for workers aged 23 (previously 25) and above will increase to £8.91 per hour. The current National Minimum Wage for those under the age of 23 will continue to apply and the rates set from 1 April 2021 can be found here National Minimum Wage Rates .

Previous posts…

The 1 April 2018 the National Living Wage (NLW) for workers aged 25 and above will increase to £7.83 per hour. The current National Minimum Wage for those under the age of 25 will continue to apply and the rates set from 1 April 2018 can be found here National Minimum Wage Rates .The Government’s objective is to have a National Living Wage of over £9 by 2020.

•The 1 April 2017 the National Living Wage (NLW) for workers aged 25 and above will increase to £7.50 per hour. The current National Minimum Wage for those under the age of 25 will continue to apply and the rates set from 1 April 2017 can be found here National Minimum Wage Rates .The Government’s objective is to have a National Living Wage of over £9 by 2020.

 

•The 1 April 2016 will see the introduction of the governments new National Living Wage (NLW) for workers aged 25 and above, by introducing a premium on top of the National Minimum Wage (NMW). From April 2016, the NLW will be set at £7.20 an hour. The current National Minimum Wage for those under the age of 25 will continue to apply and the rates set from 1 October 2016 can be found here National Minimum Wage Rates .The Government’s objective is to have a National Living Wage of over £9 by 2020.

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Budget 8 July 2015 – Key Points

Todays budget at a glance

 

Welfare and pensions

  • Working age benefits to ne frozen for four years, including tax credits and local housing allowance
  • Rents in social housing sector will be reduced by 1% a year for the next four years
  • Higher-income households in social housing will be required to pay rents at the market rate
  • Tax credits and Universal Credit to be restricted to two children, affecting those born after April 2017
  • Reduce earnings level for tax credits withdrawal from £6,420 to £3,850.
  • Disability benefits will not be taxed or means-tested
  • 18-21-year-olds will not be entitled to claim housing benefit automatically, with a new “earn to learn” obligation
  • Employment and Support Allowance payments for claimants deemed able to work to be “aligned” with Jobseeker’s Allowance for new claimants
  • pensions tax allowance to be tapered away to a minimum of £10,000 from next year
  • Dividend tax credit to be replaced with a tax free allowance of £5,000 of dividend income for all taxpayers. The rates of dividend tax will be set at 7.5%, 32.5% and 38.1%

 

Fuel

  • New VED bands for new cars to be introduced from 2017, pegged to emissions – 95% of car owners will pay £140 a year.
  • Fuel duties frozen for the remainder of this year

 

Personal Taxation

  • Personal tax allowance to rise to £11,000 next year
  • The point at which people start paying income tax at 40p to rise from £42,385 to £43,000 next year
  • National living wage to be £9 per hour by 2020 for people 25 and over, starting from £7.20 per hour from next April
  • Increase in inheritance tax threshold to £1m for married couples by 2017

 

Business

  • Corporation tax cut to 19% in 2017 and 18% by 2020
  • New apprenticeship levy on all large firms- firms that offer apprenticeships can get more back than they put in

 

Health and education

  • NHS will receive a further £8bn by 2020 (in addition to the £2bn already announced)
  • Maintenance grants for students paid to students with family income below £42,000 to be scrapped and converted into loans from 2016/17, repayable on incomes over £21,000
  • The maintenance loan will increase to £8,200

 

Housing

  • Mortgage interest relief for buy-to-let homebuyers to be restricted to basic rate of income tax
  • Rent-a-room relief scheme to rise to £7,500

 

Other

  • The cost of funding free TV licences for the over-75s will be transferred from the government to the BBC between 2018 and 2021
  • The annual household benefit cap will be reduced to £23,000 in London and to a lower level in the rest of Britain.
  • A consultation will take place on changing Sunday trading laws
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Budget 2015 – The Key Points

The Key Points from todays budget are:

  • Personal tax-free allowance will be increased to £10,800 in April 2016, and to £11,000 in April 2017.
  • Beer duty to be cut for the third year running, with 1p off the price of a pint. Cider duty to be cut by 2%. Duty on scotch whisky and other spirits to be cut by 2%. Wine duty to be frozen.
  • Pension pot lifetime allowance to be reduced from £1.25m to £1m from next year, saving £600m annually.
  • National Minimum Wage will rise by 20p an hour to £6.70 from October.
  • Corporation tax to be cut to 20% in two weeks’ time.
  •  “Help to buy ISA” will be launched for first-time buyers. For every £200 saved for a deposit, the Government will top it up with £50.
  • Personal savings allowance to be launched, taking 95% of Britons out of savings tax altogether.
  • Fuel duty increase scheduled for September is cancelled.
  • Employers’ National Insurance contributions for under-21s to be abolished from this April, and for young apprentices from April 2016.
  •  Class 2 National Insurance contributions for the self-employed to be abolished entirely in the next parliament.
  • Annual tax return to be abolished altogether.
  • “More generous” tax credits for TV and film, expanded support for video games industry and new tax credit for orchestras.
  • Trebling in £15m fund for church roof appeals, and extension to £8,000 in automatic gift aid to benefit 6,500 small charities.
  • Review on the use of deeds of variation to avoid inheritance tax to report by the autumn.
  • Charities for British servicemen and women to receive £75m, funded by Libor fines.
  • Up to £600m to clear new spectrum bands for further auctions, improving mobile phone coverage nationwide, including in remote communities.
  • Funding for wifi in public libraries and new national plan for ultra-fast broadband to nearly all homes in the country.
  • New investment in transport and regeneration across London, and funding to address acute housing shortages in the capital.
  • Automotive industry to receive £100m in investment in the race to driverless technology.
  • North Sea oil industry to receive £1.3bn in support through four new measures.
  • £1m to buy defibrillators for public places, including schools.
  • Expanded support for creative industries, including a new tax credit for orchestras.
  • Consultation on tax support for local newspapers.
  • Measures on tax avoidance and evasion to raise £3.1 billion over the forecast period.
  •  Legislation next week on diverted profits tax aimed at multinationals shifting profits offshore, with policy to take effect at the start of April.
  • The Office for Budget Responsibility says Britain’s economy grew by 2.6% last year.
  • Growth forecast for 2015 revised up by 0.1% to 2.5%, with unemployment set to fall by 0.1% from 5.4% to 5.3%.
  • OBR revises 2015 inflation forecast down to 0.2%.
  • Sale of £13bn of mortgage assets held by the Government after the bailout of Northern Rock and Bradford & Bingley is going to be launched. This will be used to pay down the national debt.
  • Bank levy increased to 0.21%, raising an additional £900m a year. New banking taxes to raise £5.3bn across forecast period.
  • Farmers will be allowed to average their incomes for tax purposes over five years.

 

 

 

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BUDGET 2014 THE KEY POINTS

 

PERSONAL TAX

  • The Personal Allowance will increase from £9,440 to £10,000 from April 2014 and to £10,500 from April 2015
  • Threshold for 40p income tax is to rise from £41,150 to £41,865 next month and by a further 1% to £42,285 next year.
  • Inheritance Tax waived for members of emergency services who give their lives in the job
  • 10p rate for savers is abolished

 

NATIONAL INSURANCE

  • The primary threshold for employees will increase from £7,755 to £7,956
  • Upper Earnings Limit will rise from £41,150 to £41,865
  • New NIC employment allowance of £2,000 begins in April 2014
  • Under 21’s taken out of employers’ national insurance contributions

 

CORPORATE TAX

  • Currently at 23%
  • Will be cut to 21% in April 2014
  • Will be cut again to 20% April 2015

 

PROPERTY AND INFRASTRUCTURE

  • Help to buy equity loan scheme extended to March 2020
  • From midnight tonight properties bought for more than £500,000 through “corporate envelopes” will be liable for 15% Stamp duty.
  • Government to create £500m builders finance fund which will provide loans to developers to unlock housing units stalled due to difficulty accessing finance

 

 

BUSINESSES

  • Annual investment aallowance to be doubled to £500,000 until the end of 2015
  • First enterprise zone in Northern Ireland to be established in Coleraine, which the government will support by offering enhanced capital allowances to investors within that zone.

 

DUTIES

  • Fuel duty rise as planned for Sept 2014 has been cancelled
  • Beer duty will be cut by 1 penny from 24 March 2014
  • Duty on spirits will be frozen for 2014-15
  • Machine games duty (MGD) the government will create a new higher rate of machine games duty at 25% for B2 machines
  • Bingo duty will be reduced from 20% to 10%
  • Tobacco duty will increase by 2% above the rate if inflation from 6pm on 19 March 2014. Annual duty increases of 2% above the rate of inflation will continue until the end of next parliament.

 

SAVINGS

  • A new single ISA will be introduced with equal limits for cash and stocks and shares. The annual investment limit will be increased to £15,000 per year
  • The cap on investments in premium bonds will be lifted from £30,000 to £40,000 from 1 June 2014, to be lifted again to £50,000 in 2015-16

 

PENSIONS

  • All tax restrictions on pensioners’ access to their pension pots to be removed. The taxable part of pension pot taken as cash on retirement to be charged at normal income tax rate, typically 20% down from 50%
  • There will be an increase in total pension savings people can take as a lump sum to £30,000
  • The total amount you can contribute to your pension scheme with tax relief each year is being cut from £50,000 to £40,000
  • The tax free lifetime allowance for the value of your pension pot is being cut from £1.5m to £1.25m

 

CHILDCARE

The Tax free childcare costs cap, against which parents can claim 20% support, will be increased to £10,000 per year for each child. This will mean that eligible parents can now benefit from greater support, worth up to £2,000 per child per year from autumn 2015. Tax free childcare will be rolled out to eligible families with children under 12 within the first year of the schemes operation.

 

The new 12 sided £1 coin to be introduced in 2017

£1 coin

 

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Bookkeeping software – The mind boggles!

So you are at the point now where your business needs a computerised bookkeepping package, but where to start and what to choose?

 

We are increasingly finding that our clients are needing this more than ever now, and its all good! Although it seems like just another time consuming hassle, it means their business is growing!

 

However, when it comes to chosing the right software, where would you even start?

 

It is important you chose the right software for your buisness, which may not be the same as what your neighbour or friend is using! Every business has it’s own unique set of requirements.

The wrong software will leave you frustrated and feeling bombarded because it will either be too simple and not provide the exact information that you and your business needs, or be too complicated and not only cost a lot but will leave you feeling extremely overwhelmed!

We can help!

 

We have been able to advise numerous businesses on their software needs, simply because we understand their business and know what they need to expect out of their software.

 

A few helpful points we have come across are as follows:

 

1. Only  a Few Transactions a Month?

 

If your business only has a few transactions a month, then you may not need bookkeeping software at all.

  • You will be able to get by using Excel, or even a paper filing system, and simply hand over the papers to your accountant when he needs them.
  • Make sure you have a separate bank account. These are generally the first thing we ask for and it helps if your business account is seperate from your personal account. This saves alot of time and makes the process of bookkeeping simpler.

 

2. Requiring regular Management Accounts?

 

If you require a regular set of Management Accounts then you will most certainly need bookkeeping software.

You should be looking at bookkeeping software that has purchase ledgers, sales ledgers, bank reconcilliation functions and is able to pull out reports such as Creditors and Debtors reports and provide  you with an easily understandable Profit and Loss Account and balance sheet.

 

3. Only Statutory Requriements

 

If you just want to fulfil your obligations to file returns  and produce annual accounts then keep it simple.

There are many packages out there that can be user friendly and help you submmit these necessary returns. They can also be easily adapted to pull out more reports if you decide you do need them.

 

4. Another alternative is to let us do it for you.

 

  • We have a broad range of skills and are well experienced in doing this
  •  We already have the software thus saving you that hassle and cost
  • We are used to the routine of bookkeeping saving you the hassle of finding the time to actually sit down and do it, letting you concentrate on your customers and your business
  • With  internet and email, information can pass efficiently and timely

 

Whatever your bookkeeping requirements why not contact us to discuss what is best suited to you and your business.

 

email us at info@jsrcharteredaccountants.co.uk

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Single Use Carrier Bag charge – VAT implications (Part 2 )

What happens if a retailer charges the customer more than the minimum 5 pence for a single use carried bag?

 

If we look an example where a retailer charges 12 pence for a single use carrier bag.

The full amount of the 12 pence is subject to VAT.  The “net sale” would amount to 10 pence and the VAT on the sale would amount to 2 pence.  The retailer, assuming he/ she is VAT registered, MUST charge VAT  on the full amount charged to the customer (provided the charge is greater than 5 pence per bag).

The amount payable to The Department of the Environment is still 5 pence.

In this instance the “sale” is deemed to be “within the scope of VAT”.

The retailer MUST charge VAT on the full amount of the proceeds of each bag sold.

 

The Net Sales entry on their VAT return (Vat Return Box 6).  The retailer needs to include the net proceeds generated from sale of bags in their routine VAT returns.  In the above example that would equate to 10 pence for each bag sold during the VAT return period.

 

The VAT due in this Period (Vat Return box 1).  The retailer needs to include the VAT liability arising on the sale of the bags in their routine VAT returns.  In the above example that would equate to 2 pence for each bag sold during the VAT return period.

 

The retailer can reclaim an input VAT incurred on the purchase of the carrier bags as normal.

 

Single Use Carrier Bag quarterly returns – please see our first article in this series where we discussed the information to be included in the quarterly returns to The Department of Environment. https://jsrcharteredaccountants.com/single-use-carrier-bag-charge

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