Karen Wharf Accounting

16/01/2023

Self assessment deadline looming 😯

23/12/2022

10/11/2022

Intuit QuickBooks.

29/09/2022

HIGHLIGHTS FROM MINI BUDGET - SEPT 2022

National Insurance U-Turn

In April 2022 Class 1 National Insurance (NI) contributions increased by 1.25p in the pound, this has now been reversed by the Government from 6 November 2022. Increases to Class 1A, Class1 B and Class 4 National Insurance Contributions have also been reversed by 1.25p in the pound.
This increase in National Insurance was the first step towards introducing the Health and Social Care Levy, an initiative that has now been scrapped.

Income Tax reduction
The Government will cut the basic rate of income tax to 19% from April 2023 (One year earlier than previously communicated). Meanwhile, the 45% additional rate of income tax will be abolished for England, Wales and Northern Ireland taxpayers (Different rates and thresholds for Scotland apply). Instead, there will be one single higher rate of income tax of 40% from April next year.

Corporation tax increase scrapped
During the Spring Statement, the former Chancellor announced an increase in the main rate of Corporation tax, rising from 19% to 25% in April 2023. This tax increase has now been cancelled and will not take place as scheduled.

Any other news in the business sector?
Whilst the news around Income Tax, National Insurance and Corporation Tax is the headline business news, there are further updates.
• The IR35 reforms of 2017 and 2021 will be repealed on 6 April 2023 - This means Agency workers (Contractors) providing their services via an intermediary will once again be responsible for determining their employment status, and paying the appropriate amount of tax and National Insurance contributions.
• The Annual investment allowance amount will remain at £1m indefinitely
• Start-up companies will now be able to raise up to £250,000 under the Seed Enterprise (SEIS) scheme that gives tax relief to investors. From April 2023 the criteria for entry has been widened, meaning more companies are eligible
• The amount of shares that can be optioned to employees under the Company Share Option Plan (CSOP) has been doubled from £30,000 to £60,000. This increase will be introduced from April 2023

24/03/2022

The Chancellor made his annual Spring Statement speech yesterday where he set out the Government’s tax plan to support the UK economy, businesses and families in both the short and the medium term.
Key measures the Chancellor announced as part of the plan include:
• an increase to the National Insurance Primary Threshold for Class 1 NICs and the Lower Profits Limit for Class 4 NICs from 6 July 2022, aligning it with the equivalent income tax personal allowance which is set at £12,570 per annum
• from April 2022, self-employed individuals with profits between the Small Profits Threshold (SPT) and the Lower Profit Limit will not pay Class 2 NICs, while allowing individuals to be able to continue to build National Insurance credits
• the Employment Allowance will be increased by £1,000 from 6 April 2022 to £5,000, which will benefit around 495,000 businesses
• an immediate reduction in duty on diesel and petrol from 6pm on 23 March 2022, by 5 pence per litre, for 12 months.

The full detail on all the measures, some of which are subject to parliamentary approval, can be found on GOV.UK.

31/01/2022

Well that's my final 2021 tax return all filed with HMRC 😀. However for those who have tax returns still outstanding, the Revenue have given some extensions due to Covid. If you need any help please do not hesitate to contact me.

23/12/2021

Wishing you all a Merry Christmas and a happy healthy new year 🎄🎅🏻

28/10/2021

October 2021
The Chancellor, Rishi Sunak, delivered the Autumn Budget on 27 October 2021. The key announcements are summarised below.
Individuals
• The 1.25% Health and Social Care Levy will be introduced from 6 April 2022 via an increase to National Insurance Contributions, before becoming a freestanding levy from 6 April 2023.
• From 6 April 2022, the dividend tax rates will also be increased by 1.25%. The basic rate dividend tax will increase to 8.75%, the higher rate dividend tax will increase to 33.75% and the additional rate dividend tax will increase to 39.35%. No increases or changes to the main or savings income tax rates.
• No increases to capital gains tax and inheritance tax rates or allowances. No changes to reliefs, including APR and BPR.
• The 30 day time limit for reporting capital gains on the sale of residential property and for payment of the tax has been increased to 60 days from Budget day.
• The income tax limits and personal allowance will remain at their current level until April 2026.
• The SDLT nil rate band for property purchases reverted to £125,000 from 1 October 2021.
• The taper rate in Universal Credit will reduce from 63p to 55p and work allowance increased to £500.
• National Living Wage will increase to £9.50 an hour from 6 April 2022.

Businesses
• Basis period reform is expected to commence from 6 April 2024, with a transitional year before this.
• This is a major change expected to raise an additional £820 million in the first full year.
• The main rate of corporation tax will remain at 19% until April 2023. From this date the main rate will increase to 25%, with a Small Profits Rate of 19% for profits not exceeding £50,000. There will be marginal relief for profits between £50,000 and £250,000 (these thresholds are proportionately reduced for the number of associated companies and short periods). Close investment holding companies, including most family investment companies, will not qualify for the 19% rate.
• Between 1 April 2021 and 31 March 2023 (extended in the Budget from 31 December this year), expenditure on new plant and machinery qualifies
for a 130% super-deduction. Expenditure on assets in the special rate pool (such as integral features in buildings and certain cars) will benefit from a 50% first year allowance.
• The £1 million annual investment allowance (AIA) limit for expenditure on plant and machinery will be extended until 31 March 2023.
• From April 2023, Research & Development (R&D) Tax Relief will be extended to include data and cloud accounting costs. Plans to target abuse and improve compliance will be published later in the Autumn.
• From 1 April 2022, Residential Property Developer Tax will be introduced at 4% for businesses with profits over £25 million.

VAT and indirect taxation
• VAT registration threshold will remain at £85,000 until 31 March 2024.
• The bank surcharge will be cut from 8% to 3% for banks with revenue over £25 million. For challenger banks, this limit is £100 million.
• 50% business rate discount for companies in the retail, hospitality and leisure sectors, up to a maximum of £110,000.
Duties
• Alcohol, fuel and vehicle excise duty rates have been frozen.
• Air passenger duties will be reduced by 50% for domestic flights from 1 April 2023.
• In wide-ranging changes to the whole regime for duties on alcohol, higher strength alcoholic drinks will attract higher duties and lower strength drinks will attract lower tax rates.
• Draught Relief and Small Brewers’ Relief will be introduced to encourage small scale brewers and pubs.