6 April 2019 marked the start of the 2019/2020 tax year. Here we focus on some of the key changes you should be aware of and consider when making business decisions.
- Making Tax Digital for VAT – businesses now must keep records in digital form and file using approved software. Do you need to register?
- Payroll – updates to paying your employees including minimum wages, national insurance and share schemes.
- Tax for Property Investors – don’t forget ATED and changes to capital gains and Stamp Duty rules.
If you need help or advice for your specific circumstances please get in touch with our friendly expert team.
Making Tax Digital for VAT
It has been hard to miss the news that digital tax is coming. You can’t have missed adverts by HMRC and software suppliers. The moment has come and now if your business has a taxable turnover of over £85,000 you are now required to keep records in a digital form and submit via software.
If we already help you with VAT Returns
We will take care of the registration process and be in touch with you if any action is required. This is an ideal opportunity to see if your book-keeping systems could be updated to take advantage of the benefits of cloud accounting.
If you handle your own VAT Returns
There are penalties for failing to comply so act now.
- Have you registered? Is it the right time to do so?
- Is your existing software acceptable to HMRC?
- Are you prepared to submit your information at the press of a button?
Not VAT Registered?
Don’t bury your head in the sand. The Making Tax Digital scheme is planned to extend to other taxes and will likely have a big impact on the way you manage your business finances.
Minimum wage increases take effect every April. You must take these changes in account when paying your employees.
Remember that you may need to look at employees birthdays, as their rate may change. We also find that there can be confusion about who is entitled to the apprentice rate.
|25 and over
|21 to 24
|18 to 20
Changes to Payslips
From 6 April 2019, the number of hours worked must be displayed on payslips where hourly rates apply. There are also changes to the way that termination payments need to be shown (specifically when payments are made related to notice periods).
Employment Allowance Warning
This allowance is currently claimed by over 1.1 million employers to reduce their employer National Insurance Contributions bill by up to £3,000. From next year (6 April 2020) if your NI bill is over £100,000 you will not be allowed to claim the allowance.
Employment Related Securities (ERS) Schemes
If you have gifted or awarded of shares in your company to employees you may need to report them to HMRC. Submissions need to be made to report new tax-advantaged schemes and reportable events for non-tax advantaged schemes.
Any returns need to be submitted by 6 July 2019.
Tax for Property Investors
Annual Tax on Enveloped Dwellings (ATED)
ATED is an annual tax payable on UK residential property not owned by individuals and valued at more than £500,000. What you need to pay is dependant on the value of the property. There are reliefs and exemptions from the tax, which may mean you do not have to pay.
Any returns need to be submitted by 30 April 2019.
Capital Gains Tax (CGT)
Non-UK residents who dispose of UK property or land need to report the transaction to HMRC within 30 days of completion. The Return still needs to be completed even if a loss has been made and even if you plan to report it separately under Self-Assessment. If you do not tell HMRC before the deadline, you may have to pay a penalty.
This system currently applicable to non-UK residents, will be introduced for UK residents from 6 April 2020.
Stamp Duty Land Tax (SDLT)
The reporting and payment deadline has been reduced to 14 days (was previously within 28 days of the effective date of transaction). Most people use a solicitor or legal conveyancer to act on their behalf but it is best to be aware of your responsibilities.
There is a new fixed penalty regime for late filing.