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Posts archive for ‘Accounting’


30th October 2018

Autumn Budget 2018

Filed Under: Tax, Accounting, Business News


Income Tax

  • Personal allowance to go up to £12,500 from April 2019. It will remain the same for 2020/21 and then increase by the rate of inflation thereafter.
  • The basic rate band will be extended to £37,500 from April 2019 and again will remain the same for 2020/21 and then increase by the rate of inflation.
  • Starting rate for savings 0% band will remain at £5,000.

Capital Allowances

  • The first-year allowanced for electric charge-points will be extended by 4 years until 31 March 2023 for corporation tax and 5 April 2023 for income tax purposes.

Capital Gains Tax

  • The qualifying period for Entrepreneurs’ Relief will be extended from one year to two years. This will affect disposals on or after 6 April 2019 except where a business ceased before 29 October 2018.
  • To qualify for Entrepreneurs’ Relief on the disposal of shares in a personal company the tests will now require the claimant to have a 5% interest in both the distributable profits and the net assets of the company.
  • UK tax residents disposing of a UK residential property will be required to make a payment on account of the capital gains tax liability due on disposals on or after 6 April 2020.
  • From April 2020 the final period exemption for private residence relief will be reduced from 18 months to 9 months.
  • From April 2020 capital gains tax letting relief will be reformed so that it only applies in circumstances where the owner of the property is in ‘shared-occupancy’ with a tenant.

Miscellaneous

  • The Gift Aid Small Donations Scheme individual donation limit increases to £30.
  • The off-payroll rules that applied to workers in the public sector form April 2016 will apply to workers in the private sector from April 2020.
  • The ISA allowance has remained unchanged at £20,000.
  • The lifetime allowance for pension savings will increased to £1,055,000.
  • The VAT registration threshold for registration and deregistration will not change for a further two years and will remain at £85,000 and £83,000 respectively.

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26th September 2018

Making Tax Digital for VAT

Filed Under: Tax, Accounting, Business News, VAT


Making Tax Digital (MTD) is probably the biggest change to the tax system in the UK since the introduction of Self-Assessment.  Full MTD is being phased in over a number of years, with Making Tax Digital for VAT being introduced April 2019.

Outline

With effect from 1 April 2019 all businesses with a taxable turnover above the VAT registration threshold (currently £85,000) will be required to keep digital records and submit VAT returns digitally.  This obligation continues even if their taxable turnover subsequently falls below the VAT threshold.

Businesses that are voluntary registered with a turnover below the threshold are not obligated to keep and submit digital records.  However, these businesses may wish to comply to MTD if they believe that their turnover will exceed the turnover threshold in the foreseeable future.

It will be a requirement to keep digital records; these can be maintained in more than one program or software product. The use of spreadsheets, either to record individual transactions or as part of a suite of software and spreadsheets is permitted. However, the spreadsheet will need to MTD compatible so that data can be sent to and received from HMRC systems. Where the records are maintained in more than one program or product there must be digital links between each of the pieces of software.

Choosing software

There are many software packages out there that offer MTD compatibility, some more expensive than others and some offering more functionality.  Organisations that are already making extensive use of information technology will need to ensure that their software supplier is going to provide MTD compatible versions of the applications that they may use. In these cases the existing and future requirements of an organisation will need to be considered. In recent years we have seen a number of major changes to UK legislation; for example, GDPR, auto-enrolment, open banking and MTD.  In many cases it may well be easier and cost effective for an organisation to choose an application that resides, or is at least connected, to the “cloud”.  Applications that are hosted on the internet (in the cloud) are able to make connections with other digital services and as a result provide increased functionality and flexibility.  Those not currently using software will need to bring their accounts processes up to date.  There are many advantages to using modern cloud-based packages which can help increased efficiency and profits given the right support. It is fair to say that the rate of change in technology and business has never been faster. That rate of change will only ever increase. As a result, all organisations will need to consider how they will remain competitive in the future.

How we can help

We appreciate that this is a big issue for our clients and that decisions made now will impact significantly the future.  We are therefore offering free drop in workshops to look at the various software packages available and to discuss the criteria that you would need to consider ensuring you make informed judgements in your selection process.  Our ‘Getting to Grips with Making Tax Digital’ week commences on 26 November 2018.  More details will follow, and you will be able to sign up to workshops at our Autumn Drinks Party on 5 October 2018.

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7th June 2018

THL Top 10 Benefits to Cloud Accounting

Filed Under: Tax, Accounting


With the Government’s plans to Make Tax Digital (MTD) by 2019, quarterly submission will be required to be filed using some form of software.

From April 2019, businesses with a turnover above the VAT threshold will have to keep digital records for VAT purposes and from 2020, businesses may be asked to keep digital records and update HMRC quarterly for other taxes.

In preparation for when the new regulations are fully introduced, online/cloud accounting software is propose as a solution for small and medium-sized businesses. Cloud accounting software, such as Xero, increases efficiency, offers a range of features and many more benefits.

Our Top 10 Benefits to Cloud Accounting

  • Easy to use
  • Access to multiple users and set permissions
  • Automatic software updates
  • Save time with automation
  • Works from anywhere with an internet connection
  • Value for money
  • Up-to-date data
  • Secure
  • Collaborate easily with your accountant
  • Performance reports for your business

It is worth noting that HM Revenue & Customs currently have no plans to provide a free software for Making Tax Digital.

For further information regarding Cloud Accounting please contact our Accounts Manager Laura Clark .

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