Get your Tax Return done early!

Get your Tax Return done early!

 

Are you putting off filing your tax return? Are you one to put it off until next year, given the deadline is 31st January 2023? Getting your tax return submitted early could attract several benefits.

Let’s take a look at eight reasons why we think getting your tax return prepared and submitted early is beneficial.

Know your liability-Filing your tax return early will ensure you know your tax liability earlier, claim all allowable tax reliefs as early as possible and avoid last minute panic.

Receive a repayment sooner– You are entitled to a refund from HMRC if you have overpaid tax during the year. If you have overpaid tax, it is advisable to complete your tax return as soon as possible, so that you can claim this refund. This could improve your cashflow.

More time for tax planning– Preparing your return early enables you to consider any tax planning opportunities, allowing you to implement them in time for the following tax year.

Do you owe less than £3000 in tax? there is an option to have this tax collected through an adjustment to your tax code.  This means any tax owing would be collected from your monthly salary over 12 months. This is effectively an interest free loan from HMRC. However, you must file your tax return before 31 December and elect to pay this way.

Avoid late penalties– Filing early will give you time to address any problems and avoid HMRC’s late filling penalties. If you miss the January 31st deadline, you will incur a £100 penalty.

Need to contact HMRC– If you have attempted to get in touch with HMRC’s personal tax helplines in January, you will most likely know their hold music by heart.

With increasing pressure on already stretched resources due to the coronavirus pandemic, and new customs requirements due to Brexit, it is all set to get even worse.

According to HMRC’s own data released last year, the average wait time for callers had risen to almost 14 minutes, and 49.2% of callers had to wait for more than 10 minutes to be answered. Filing early will mean avoiding this.

Avoid stress and Minimise Mistakes– HMRC says that 26,562 people filed their tax return between 11pm and 11:59pm on the January 2021 deadline.

While leaving it late might be unavoidable for some, it does carry the risk of making more errors than necessary, and mistakes can lead to fines. HMRC charge 0 to 30% of the tax due if people have been careless.

Also leaving filing until the last minute could mean not being able to get important information, such as dividend certificates and bank interest details, before the deadline.

Gives you more time to research Professional advice– You can include the costs of hiring a professional accountant or adviser as a tax-deductible expense. It gives you more time to find the right professional to help you out. It’s important to do your research and make sure you find someone with a great reputation, as bad advice can cost you time and money.

Their advice can help you set up a proper record-keeping system, also, their knowledge of tax and expenses could go towards reducing your overall tax liability.

For a free no obligation meeting click here: http://integrityaccountancy.com/contact-us

Autumn Budget 2021

Autumn Budget 2021

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The Chancellor, Rishi Sunak, is due to announce the Autumn Budget on
the 27th of October. This budget usually entails financial and economic reports, and an update on the state of public finances. He will also announce changes to tax rates, any tax-free allowance adjustments and detail out plans for future government spending.
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What we already know for this Autumn’s budget

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We know that higher taxes are on the cards in the spring as the government finds ways of paying for their high rates of spending.
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Here are some changes that we already know about:
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  • National insurance contributions will increase by 1.25% from April next year.
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  • Dividend tax will increase by 1.25%, which means investors will have to pay more on their earnings.
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  • We also know that the government will give a £500m Household Support Fund to councils to help the most vulnerable families in England this winter.

 

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In under two weeks’ time, we will know more about other economic changes, and how our finances will be affected both for our businesses and on an individual level.
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If you’d like a free meeting with a Chartered Management Accountant, please contact us on 0333 444 1539.
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Card Reader Options for Small Businesses

Card Reader Options for Small Businesses

 

 

With today’s current climate and buying habits, it’s commonly accepted that most businesses accept card payments. The contactless spending limit is even due to increase from £45 to £100 later this year, the Treasury has confirmed.

However, it is often less obvious to decide how to accept card payments. There are many options available, such as fixed card terminals, portable machines, and mobile card readers. In this article, we’ll explore which type to use for your business, and why.
App-based card readers are becoming increasingly popular with small businesses and start-ups, especially those which operate a mobile business. They work by connecting the small device to Wi-Fi or a mobile phone connection to process the payment. For low-volume, low-value scenarios they are ideal with low start-up costs and no monthly fees. But their slower speed of operation and higher transaction costs mean they are not as suitable as volumes and values increase.
For larger operations, or businesses or charities who regularly accept card payments, especially where speed of operation is a requirement and/or high values are involved, traditional chip and PIN terminals are the preferred option.

 

These terminals include:
Countertop machines – where the machine sits on a counter connected by wires to a broadband or phone line port.
These machines are ideal for businesses or charities with a fixed location who serve customers at a till point.
Portable machines – where the machine sits in a cradle or base unit and can be picked up and used up to approximately 50 metres away from the base unit. The base unit is connected to an internet or phone line and charges the portable terminal and establishes a connection through Bluetooth or Wi-Fi.
Portable terminals are ideal for businesses with a fixed location who accept payments from around the premises such as restaurants and bars.

 

Mobile machines – a self-contained portable chip and PIN machine which uses mobile internet or Wi-fi connections to complete transactions. These machines are ideal for businesses and charities who operate at a variety of locations or events. Mobile food vans, pop-up shops and market stalls as well as charities canvassing for donations in different areas can all benefit from a mobile chip and PIN terminal.

 

Particularly for small businesses, we have found that SumUp offers the best card reader with the lowest running costs. Their wireless card reader can facilitate contactless and chip payments, connecting to a mobile device via Bluetooth. It accepts all major card types, including Visa, Mastercard, American Express, Apple/Google Pay etc. SumUp offers the lowest transaction fees, at 1.69%. The upfront cost is £29 (excl. VAT), and there are no monthly fees like a fixed card terminal.

 

If you’d like any other advice on becoming self employed or forming a limited company, please contact us to book a free meeting with a Chartered Management Accountant.

0333 444 1539

The Company Christmas Party in 2020 – Time for Virtual!

The Company Christmas Party in 2020 – Time for Virtual!

 

The Covid-19 lockdown restrictions have put a stop to the annual office party and have forced employers to think of alternative ways to wish employees a happy Christmas and to boost morale.  

 

Christmas parties

Employers are allowed to host an annual event. This doesn’t have to be at Christmas, it could be held at any time of the year, the key here is that it is an annual event and is made available to all employees, or all in a particular location where an employer has more than one location, at a cost of less than £150 per head.

 

All costs of providing the event must be counted when calculating the ‘per head’ cost. This could include:

Entertainment

Food and drink

Transport and accommodation that enables an employee to attend

VAT

This list isn’t exclusive.

 

If the cost exceeds £150, then the whole amount will become taxable.

 

HMRC has now confirmed, that where all normal conditions are met, virtual events can be included when considering the £150 exemption.

 

An example of this may be a company holds one annual function in a tax year and does so virtually using IT. All employees are invited and each is provided with a hamper consisting of some food and drink to be enjoyed by the attendees during the party. The total cost per head is £100 which is within the £150 exemption and so the exemption applies.

This is great news to almost half of employers who confirmed in a recent poll, that they fund the full amount incurred for hosting the annual Christmas party.

 

Trivial benefits

The statutory exemption lays out certain criteria that must be met in order to be counted as a trivial benefit which ensure that:

The benefit is not cash or a cash voucher

The cost to provide does not exceed £50

The benefit is not provided as a contractual entitlement

The benefit is not provided in return for a normal service (or services) expected by the employee – e.g. hitting a pre-set performance target

 

Common examples seen include a gift of flowers on a birthday, a turkey at Christmas, or a modest layette on the birth of a child. More than one trivial benefit can be provided during the year; however, where the employer is a close company and the trivial benefits are given to a director, office holder or members of their families or households, an annual limit of £300 exists.

 

When all else fails

Otherwise referred to as a Christmas bonus, arguably a cash gift could present the employer with the most simple solution for saying thank you to their employees and spreading a little cheer during the festive season. Even a modest cash bonus can bring out the child in us (who didn’t love a £5 note from a favourite Aunt or Uncle tucked into our birthday or Christmas cards)?

 

A gift such as this, and for whatever reason it is given, will be subject to PAYE income tax and Class 1 NICs but the amount that the employee receives in their pay will depend upon their individual circumstances, and particular tax bands.

 

How do employers normally celebrate during the Christmas period?

A recent survey found that most employers demonstrated their Christmas spirit, and provided gift vouchers (4%), turkeys (1%), chocolates/biscuits (4%), a cash bonus (4%), an annual party (35%) and even some (1%) employers showering unlimited generosity (budget allowing). There remained a some Scrooge-like behaviour, with 46% of respondents admitting to being provided with nothing from their employers at Christmas. Bah Humbug!

Updated Job Support Scheme

Updated Job Support Scheme 

 

Are you aware of the new government support available for your business and employees?

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A newly updated Job Support Scheme will replace the furlough scheme on 1 November, in an attempt to help business owners retain their staff.

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If you have to close your business, your staff could receive 67% of their wages, up to a maximum of £2,100 a month. The employee must be off work for a minimum of seven days to be eligible. You won’t have to pay towards their salary.

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What if your business is open but not busy?

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If your business can stay open but your employees have less work available, they can work part-time and still receive extra support. This is regardless of which tier you’re in.

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You will have to pay your staff to work at least 20% of their usual hours per month. You must pay an extra 4% of total wages, and the government will pay 49% of their total salary.

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In total, the employee would receive at least 73% of their salary for working 20% of their contracted hours. The maximum contribution the government will make is £1,541.75. To qualify, you must have been on your work’s payroll since 23 September.

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You can be moved on and off the scheme, or work different hours, but each working arrangement must cover at least seven days. The scheme will run for six months from 1 November, and then be reviewed.

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A grant available to self-employed people affected by coronavirus has also been doubled to 40% of profits, with a maximum grant of £3,750 over a three-month period.

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At Integrity Accountancy Services, we are more than happy to help more businesses receive these support payments and grants. Even if you would just like to know more information about this, please don’t hesitate to contact us on 0121 777 5361