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Ken Dodd has the last laugh

21 Mar, 2018

The recent death of the comedian, Sir Ken Dodd, aged 90, would not usually be the topic of one of our weekly articles. However, the comedian managed to have one last laugh by marrying his partner of 40 years just days before his death. By doing this it is estimated his estate has avoided a tax bill of almost £2 million.

Directors beware National Living Wage complications

21 Mar, 2018

From 1 April 2018, the National Living Wage (NLW) will increase by 33p to £7.83. This represents an increase of 4.4%. The NLW is the minimum hourly rate that must be paid to those aged 25 or over. For the 21 to 24 year old’s, the hourly rate of the National Minimum Wage will increase to £7.38 (a rise of 33p).

Marriage allowance still time to apply

21 Mar, 2018

The marriage allowance is available to married couples and those in a civil partnership, where a spouse or civil partner doesn’t pay tax or doesn’t pay tax above the basic rate threshold for income tax.

The lower earning partner can transfer up to £1,150 (increasing to £1,190 in 2018-19) of their personal tax-free allowance to a spouse or civil partner. The marriage allowance can only be used when the recipient of the transfer doesn’t pay more than the basic 20% rate of income tax.

Tax Diary April/May 2018

20 Mar, 2018

1 April 2018 - Due date for corporation tax due for the year ended 30 June 2017.

19 April 2018 - PAYE and NIC deductions due for month ended 5 April 2018. (If you pay your tax electronically the due date is 22 April 2018)

19 April 2018 - Filing deadline for the CIS300 monthly return for the month ended 5 April 2018.

19 April 2018 - CIS tax deducted for the month ended 5 April 2018 is payable by today.

30 April 2018 – 2016-17 tax returns filed after this date will be subject to an additional £10 per day late filing penalty.

Childcare voucher scheme deadline extended

18 Mar, 2018

The government has announced that the employer-operated childcare voucher scheme will remain open to new entrants for a further six months, i.e. until October 2018. The childcare voucher scheme, also called employer-supported childcare (ESC), was due to close from 6 April 2018 and be replaced by the government-backed childcare payments scheme, also called tax-free childcare (TFC). The government announced the extension during a debate in the House of Commons in response to concerns expressed by MPs about problems with the operation of TFC.

New offshore tax penalties

14 Mar, 2018

New legislation that comes into effect from 1 October 2018 will see higher penalties for anyone with undeclared offshore assets. HMRC has published a news release urging taxpayers with undeclared offshore assets to become compliant and warning taxpayers that they will prosecute the most serious cases of tax evasion. These new penalties are part of HMRC’s plans to target overseas tax avoidance.

ISAs transfer of benefits upon death

14 Mar, 2018

New rules were introduced in April 2015 that allow for the spouse or civil partner of a deceased ISA saver to benefit from additional ISA benefits. Under the rules, if an ISA saver in a marriage or civil partnership dies, their spouse or civil partner inherits their ISA tax advantages.

Surviving spouses are able to save an additional amount in an ISA or ISAs up to the value of their spouse or civil partner’s ISA savings at the date of death. This additional allowance does not count against the surviving spouse’s/civil partner’s annual ISA subscription limit.

Information Commissioner’s Office publishes introduction to the Data Protection Bill

14 Mar, 2018

The Information Commissioner's Office (ICO) has published a 77-page introduction to the Data Protection Bill, to help businesses navigate their way around the Bill and focus on the areas that are most relevant to them. Assuming it receives Royal Assent and becomes the Data Protection Act 2018, the Bill is expected to come into force on 25 May 2018, i.e. on the same date as the EU General Data Protection Regulation (GDPR). The two pieces of legislation will then work alongside each other in place of the current Data Protection Act 1998, which is to be repealed.

Tax avoidance scheme scuppered by HMRC

14 Mar, 2018

A tax avoidance scheme used by businesses that sought to avoid paying tax and National Insurance on company directors’ bonuses was the subject of a recent Upper Tribunal hearing. HMRC challenged the validity of tax claims by two companies firstly at the First-Tier Tribunal and then at the Upper Tribunal.

The two cases were heard together as the underlying appeals raised similar issues and were designated as related cases by the Tribunal. In addition, there were also over a hundred other businesses using similar schemes and attempting to avoid paying over £55m in tax.

Claiming legal and financial costs

14 Mar, 2018

The self-employed are often concerned as to whether an expense is allowable for tax purposes. As a general rule, the self-employed can deduct running costs of the business when working out their taxable profit as long as the expenses are classed as 'allowable expenses'. In this article, we briefly look at the rules for claiming expenses relating to claiming legal and financial costs.

HMRC provides the following guidance on the matter.

Accountancy, legal and other professional fees can count as allowable business expenses.

You can claim costs for:

Inflation proofing corporate gains ceased December 2017

14 Mar, 2018

As part of the Autumn Budget measures, the Chancellor announced that the indexation allowance for corporate chargeable gains would cease on 31 December 2017. The indexation allowance allowed companies to compensate for the effects of inflation and claim tax relief when calculating any chargeable gains.

Tax break to help black cabs turn green

14 Mar, 2018

The government has confirmed that a new tax allowance for electric taxis will come into effect from April 2018, a year earlier than had been expected. The new exemption will be worth £1,550 for anyone purchasing a new zero emission black cab. In addition, zero emission taxis worth over £40,000 will no longer have to pay the Vehicle Excise Duty charge from this April.

It is hoped that these changes will help encourage more taxi drivers to replace old diesel taxis for a cleaner and greener alternative. Drivers will also benefit from over £400 a month in fuel savings.

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