In 2015 the government announced major plans to modernise the tax administration system by introducing digital services for tax. There are three main strands to these proposals, as follows:
Our sister company Friar Gate currently has a vacancy for a Part Time Administration Assistant - for full details visit:
FGIFS - Administration Assistant
We thought it was time for a new Ashgates look! We hope you like it..
We now look a little crisper and more modern but other than our logo and colours, we remain the same Ashgates you have always known.
Our new look was driven by our Director of IT, Jon Woliter and his IT team, who have designed and delivered our new look through all forms of media, from our website & app to our printed letterhead. We specifically knew our previous logo was not befitting to modern digital publications and as we wanted to release a new mobile friendly website, we took the opportunity to refresh our whole look at the same time.
If you wish to discuss ways the Ashgates IT team can help you, please get in touch - 01332 380691 or www.ashgatesit.co.uk.
Following consultation the government has issued further details of the new Lifetime ISA account which is expected to be available from April 2017.
In summary the account will be available to adults under the age of 40 and individuals will be able to contribute up to £4,000 per year and receive a 25% bonus from the government. Funds, including the government bonus, can be used to buy a first home at any time from 12 months after opening the account and can be withdrawn from age 60 completely tax free.
The new Lifetime ISA is designed to allow flexible saving for first time buyers and those wishing to save for their retirement.
Further details of the new Lifetime ISA are as follows:
HMRC recently lost a first tier tribunal case on the recovery of VAT on the purchase of six cars.
Although most VAT registered businesses are able to recover the VAT on the purchase of commercial vehicles the rules for the recovery on a car state two conditions must be met:
• the vehicle must be used exclusively for business purposes and
• it is not made available for private use.
In the case of Zone Contractors Ltd the court accepted that six cars were not available for private use which allowed the business to successfully recover the VAT on the six cars.
The business had a strongly worded contract of employment that prevented employees from using company cars for private travel. This was the crucial factor in this case and allowed the business to recover over £27,000 in input VAT on the purchase of six new cars. The tribunal was satisfied that the cars were wholly used for business purposes and were not available for private use. The tribunal also rejected HMRC’s argument that the company had failed to demonstrate that the cars were not available for private use.
Other factors which were relevant:
Internet link: Tribunal decision
The National Minimum Wage (NMW) is a minimum amount per hour that most workers in the UK are entitled to be paid. NMW rates increases come into effect on 1 October 2016.
• the rate for 21 to 24 year olds will increase by 25 pence to £6.95 per hour
• the rate for 18 to 20 year olds will increase by 25 pence to £5.55 per hour
• the rate for 16 to 17 year olds will increase by 13 pence to £4.00 per hour
• the apprentice rate will increase by 10 pence to £3.40 per hour.
The mandatory National Living Wage (NLW) applies for workers aged 25 and above. This is £7.20 an hour.
NLW and NMW rates will in the future be uprated every April starting in April 2017.
Penalties may be levied on employers where HMRC believe underpayments have occurred and HMRC may ‘name and shame’ non-compliant employers.
National Living Wage hits small business costs
According to research, 47% of small business owners blame increased wages following the introduction of the NLW as the main contributor to rising costs.
The research, carried out by the Federation of Small Businesses (FSB), revealed that a third of FSB members claim that the NLW has led to a small increase in their wage costs while one in five have said that their staff costs have increased significantly. Although 59% of FSB members absorbed the increased costs through reduced profitability, 35% have increased prices, 24% reduced staff hours and 23% cut investment.
HMRC have updated their guidance on payroll reporting including what employers should include on the Full Payment Submission (FPS) and Employer Payment Summary (EPS) returns.
Please contact us if you would like help with your payroll.
Internet links: ACAS article FSB press release Payroll guidance
HMRC have announced further details of the new Tax Free childcare scheme which is to be introduced in 2017.
To be eligible, families will have to have all parents in work and each expecting to earn at least £115 per week and less than £100,000 a year and not be already receiving support through Tax Credits or Universal Credit. The government will top up the account with 20% of childcare costs up to a total of £10,000 - the equivalent of up to £2,000 support per child per year (or £4,000 for disabled children). HMRC are asking childcare providers to register for the scheme as soon as possible.
Tax-Free Childcare will be launched from early 2017. The scheme will be rolled out gradually to families, with parents of the youngest children able to apply first. Parents will be able to apply for all their children at the same time, when their youngest child becomes eligible. All eligible parents will be able to join the scheme by the end of 2017.
The current system of employer supported childcare will continue to be available for current members if they wish to remain in it or they can switch to the new scheme. Employer supported childcare will continue to be open to new joiners until April 2018.
The existing system of employer supported childcare provides an income tax and national insurance contributions (NIC) relief. The maximum relief is an exemption from income tax and NIC on £55 a week. This relief is per employee so if both parents are in employment the maximum exemption is £110 per week. In the new scheme the limit is per child.
Throughout September and October 2016, letters are being sent to regulated and approved childcare providers asking them to sign up online for Tax-Free Childcare. Only childcare providers registered with a regulator (such as Ofsted) can receive Tax-Free Childcare payments.
The government will make more information available, including details of how parents can sign up, later this year.
Internet link: GOV.UK tax free childcare
The Chancellor of the Exchequer, Philip Hammond, will present his first Autumn Statement to Parliament on Wednesday 23 November 2016.
The Chancellor recently met with representatives from British business and business groups to listen to their views ahead of the Autumn Statement. The events, which took place at the Treasury and Downing Street, also provided the opportunity for discussions regarding leaving the EU.
The Chancellor said:
‘My message to businesses is clear: in our negotiations to leave the EU, we will work hard to get the best deal for Britain and that includes ensuring that British companies can continue to trade with the single market in goods and services.’
Carolyn Fairbairn, Director General of the CBI, commented:
‘Business wants the openness of the UK’s economy to be preserved – specifically access to markets, skills and trade – and to see an ambitious Autumn Statement that drives investment and growth, and delivers jobs and prosperity for all of the UK’s regions.’
We will keep you up to date with pertinent announcements from the Autumn Statement.
Internet links: GOV.UK News Gov.UK News