There has been an increase in fraudsters targeting email addresses with promises of tax rebates.

HMRC will never contact you about a rebate by email (or text message), only by official letter.

Never click on any links in suspicious emails, proclaiming to be from HMRC.  DO NOT provide your sign in details or bank details!

If in doubt, give us a call and we can check your account online.

~ Sarah

Summary of the main announcements in the Spring Budget, 8th March 2017

The Chancellor confirmed that the individual personal allowance will increase to £11,500 for 2017/18 from the current rate of £11,000.

The Higher Rate Threshold will rise by £2,000. This means that the point at which the higher rate of Income Tax is payable will increase from £43,000 in 2016 to £45,000 in April 2017.

The rates of tax for 2017/18 will remain at 20% and 40% for the basic and higher rates and the additional rate of tax remains at 45%.

Corporation Tax

Corporation Tax rate, currently at 20% for 2016/17 will drop to 19% from 1^st April, 2017. It will fall to 17% by 2020 – the lowest in the G20.

The review of the Research and Development Tax Credit regime for small and medium sized companies has found that the UK’s R&D regime is an effective and internationally competitive element of the government’s support for innovation. To further support investment, the government will make administrative changes to the Research and Development Expenditure Credit to increase the certainty and simplicity around claims.

Companies will have to use digital software and update HMRC on a quarterly basis from 1^st April, 2020.

Dividends

Just one year after its introduction in April 2016, the dividend allowance will be reduced from £5,000 to £2,000, to reduce the tax differential between the self-employed and employed, and those working through a company. From April 2017 this measure will cost basic rate taxpayers £225, higher rate taxpayers £975 and additional rate taxpayers £1,143 a year.

Value Added Tax

Registration and deregistration thresholds – From 1 April 2017 the VAT registration threshold will increase from £83,000 to £85,000 and the deregistration threshold from £81,000 to £83,000.

The rate of VAT remains unchanged at 20%.

National Insurance

The government has already announced that it will abolish Class 2 NICs – a flat-rate charge on the self-employed – from April 2018.

However, Class 4 National Insurance Contributions on the self-employed will rise from the current rate of 9% to 11% over the next two years.

The Chancellor believes this will be fairer as the self-employed have always paid less NIC than employees. He didn’t mention that the self-employed do not get the same benefits as the employed – no employer pension contributions, sick pay nor holiday pay. (And he missed the obvious point that he could have been fairer to everyone by cutting the NIC on employees!)

Fuel Duty

Vehicle Excise Duty (VED) – From 1 April 2017, VED rates for cars, vans and motorcycles registered before April 2017 will increase by Retail Prices Index (RPI).

HGV VED and Road User Levy – HGV VED and Road User Levy rates will be frozen from 1 April 2017.

Air Passenger Duty

APD rates for 2018-19 will be increased in line with RPI.

Miscellaneous

Making Tax Digital

The government will provide an extra year, until April 2019, before Making Tax Digital is mandated for unincorporated businesses and landlords with turnover below the VAT threshold. This will provide them with more time to prepare for digital record keeping and quarterly updates.

Other unincorporated businesses and landlords will be required to use digital software to keep tax records and update HMRC on a quarterly basis from April, 2018.

Final Thought:

If you want less of something, you tax it more e.g. tax on cigarettes and sugar.

Maybe the Chancellor should reflect that the same might apply to self-employment?

FEEL FREE TO CONTACT ME FOR FURTHER DETAILS ON ANY OF THE ABOVE:

 JOHN BARFOOT   028 796 31343

OR EMAIL ME AT   jb@johnbarfoot.co.uk

Our clients are in numerous sectors, and we use our 30+ years of experience along with our small-practice ‘family’ culture to provide expert advice and guidance for each one.

We are a full-service firm and our clients benefit from our range of specialist services, including:

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Our approach is strictly proactive and our continued professional training and research means we stay up to date with the very latest in UK tax law.  When there is a new development in this area or something changes in your family or business situation, we will contact you to advise on what these changes will mean for you and your business.  Our clients are always welcome to get in touch with us for advice on financial or business matters.

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Over 30+ years, we have worked with many hundreds of different businesses, to develop a series of processes, systems and tools to help businesses like yours become much, much more successful.  We will analyse your business and show you exactly where you need to focus to increase your profit, reduce stress and enjoy more time off from working.  What would you do with the extra money and freedom?

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