Tax / 90 posts found
New credit card payment fees take effect
Clients may be interested to know that HMRC have introduced a new schedule of fees, which apply from 1 April 2016, and replace the former 1.5% fee. The new rates vary depending on the type of card used and whether the card is a personal or corporate card. Broadly, the fees for paying using personal credit cards have been reduced and the rates for corporate credit cards have increased. The new rates can be found in the schedule to The Fees for Payment of Taxes, etc. By Credit Card Regulations 2016 (SI 2016/333). For personal credit cards, the fees are [...]
New student loan plans take effect
Repayment of student loans is a shared responsibility between the Student Loans Company (SLC) and HMRC. Employers have an obligation to deduct student loan repayments in certain circumstances and to account for such payments 'in like manner as income tax payable under the Taxes Acts' (Education (Student Loans) (Repayment) Regulations 2000, SI 2000/944, reg 14). With effect from 2016/2017 there are two plan types for student loan repayments: plan 1 with a 2016/2017 threshold of £17,495 (£1,457 a month or £336 per week); plan 2 with a 2016/2017 threshold of £21,000 (£1,750 a month or £403 per week). Plan 1 [...]
May 2016 Q&A
Q1. How do I work out my share of a capital gain? I owned a quarter share in a property that was sold in 2015. It was not my main residence at any time during my period of ownership. I am trying to work out my share of the capital gain arising on the property. Do I simply divide the purchase price, sale price, and any improvement costs by four to work out how much tax I will have to pay? A: Assuming that all the improvement costs and the sale proceeds relating to this property were 25% your responsibility, [...]
Closer alignment of income tax and NICS?
The Office of Tax Simplification (OTS) has published its recommendations on the closer alignment of income tax and national insurance contributions. The report contains some bold recommendations for what would be a major reform of the UK's tax rules. At summer Budget 2015, the government asked the OTS to look at options for aligning Income Tax (IT) and National Insurance Contributions (NICs). This followed on from recommendations made by the OTS as far back at 2011, and the latest report builds on earlier work of the OTS including the reviews of small business taxation and employee expenses and benefits. Key [...]
OTS recommends simplifications for small companies
The Office of Tax Simplification (OTS) has unveiled a package of recommendations aimed at making the tax system simpler and easier to use for small companies. The report, entitled Small company taxation review contains a mix of long range structural change ideas and simpler short term administrative improvements. The recommended administrative changes include: aligning filing and payment dates, e.g. VAT and PAYE, and annual returns and corporation tax; HMRC providing extra support at weekends and evenings when more small company owners deal with their tax affairs; stopping companies providing the same information to various government departments who instead should share [...]
Guidance on SDLT Budget reforms
Following announcements made in the 2016 Budget on 16 March, HMRC have published further guidance on the changes that are being made to stamp duty land tax (SDLT), and how they affect non-residential property transactions from 17 March 2016. The changes mean that: on or after 17 March 2016, the SDLT rate for non-residential freehold and leasehold transactions will only be payable on the portion of the consideration which falls within each band (rather than tax being due at one rate on the entire value); SDLT on the rental element of non-residential leasehold transactions is already taxable on the portion [...]
April 2016 Q&A
Q. Can I transfer my personal allowance? I work part time and don't earn enough to pay tax, but my wife earns £25,000 a year from her full time job. I have been told that I can transfer some of my personal allowances to her so she can save some income tax. Is this true? A Claiming the marriage allowance can save married couples or civil partners up to £220 in 2016/17, but many couples have not claimed it yet. The allowance was introduced from 6 April 2015, and enables married couples or civil partners to transfer £1,100 of personal [...]
Employee bonus schemes in the spotlight
HMRC have recently published the latest addition to their tax avoidance guidance series, entitled Employee Bonus Schemes: Growth Securities Ownership Plan and other avoidance schemes based on contracts for difference (Spotlight 28). The Spotlight guidance confirms that, in HMRC's opinion, growth securities ownership plan schemes do not work and any payment made by an employer to an employee on the maturity of the contract for difference should be taxed as employment income and subject to PAYE income tax and National Insurance contributions (NICs). Broadly, under this type of arrangement, each employee acquires a contract for difference which entitles the employee [...]
Personal savings allowance update
From 6 April 2016, the personal savings allowance (PSA) will allow basic rate taxpayers to receive up to £1,000 of savings income tax-free. For higher rate taxpayers, this limit will be £500. HMRC have published guidance setting out details of what counts as savings income and how the allowance will be calculated, including some useful examples. Savings income includes account interest from: bank and building society accounts; accounts with providers like credit unions or National Savings and Investments. It also includes: interest distributions (but not dividend distributions) from authorised unit trusts, open-ended investment companies and investment trusts; income from government [...]
Landlords’ replacement wear and tear allowance
Capital allowances are not available for expenditure on furniture and furnishings for use in dwelling houses. However, until 5 April 2016 (1 April 2016 for corporation tax) a deduction for wear and tear may be claimed (known as a 'wear and tear allowance election'), equal to 10% of the 'net rents' from furnished lettings (ie after deducting payments that would normally be borne by the tenant, such as water rates). In addition, a deduction may be claimed for replacing fixtures that are an integral part of a building (eg central heating systems), but excluding additional expenditure on 'improved' versions of [...]