Tax E-News

New Year resolutions to save tax

At this time of year we think about New Year’s resolutions. It is also a good time to start planning your tax affairs before the end of the tax year on 5th April.

Pension planning

For most taxpayers the maximum pension contribution is £40,000 each tax year, although this depends on their earnings. This limit covers both contributions by the individual and by their employer.

New VAT rules for construction sector start on 1 March 2021

New VAT rules are finally due to come into effect this March which will impact on accounting for VAT for transactions in the construction sector. These new rules, which were originally scheduled to start back in October 2019, have already been delayed twice as there was a lack of awareness of the changes in the industry.

£1 million annual investment allowances extended

The Chancellor recently announced that the temporary increase in the Annual Investment Allowance (AIA) for expenditure on plant and machinery has been extended to 31 December 2021.

Advisory fuel rate for company cars

These are the suggested reimbursement rates for employees' private mileage using their company car from 1 December 2020. Where there has been a change the previous rate is shown in brackets.

Time to review your will?

Top of the to do list for many individuals is to make or update their will. Many think this is something to leave until later in life but it is important to get things in place once property is acquired or when children come along.

Passing on the family home

One recent change that should be taken into consideration when drafting your Will is the additional Inheritance Tax (IHT) nil rate band for passing on the family home to direct descendants on death. We can work with your solicitor to make sure your Will is tax efficient.

Diary of main tax events

January / February 2021

Claim your "furlough" grant by 14th

We now have further details of the operation of the extension of CJRS “furlough” that will apply from 1 November 2020 through to the end of March 2021.

Reference pay

An employee’s reference pay will depend upon whether or not they were on the payroll and subject to an RTI submission for 2019/20 on or before 19 March 2020.

New penalties for overclaimed CJRS, SEISS and "Eat out to help out" grants

HMRC have announced that they will be imposing penalties of up to 100% of the amounts overclaimed on businesses so make sure that your claims are correct.

Make a claim if you are working from home

With more of us working from home there is good news from HMRC that employees can now make a claim for tax relief to cover some of their costs while they are working from home.