Blog

Tax Diary May/June 2018

1 May 2018 - Due date for corporation tax due for the year ended 30 July 2017. 19 May 2018 - PAYE and NIC deductions due for month ended 5 May 2018. (If you pay your tax electronically the due date is 22 May 2018) 19 May 2018 - Filing deadline for the CIS300 monthly return for the month ended 5 May 2018. 19 May 2018 - CIS tax deducted for the month ended 5 May 2018 is payable by today. 31 May 2018 - Ensure all employees have been given their P60s for the 2017-18 tax year. 1 June 2018 - Due date for corporation tax due for the year ended...

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Renewing tax credit claims

Families and individuals that receive tax credits should ensure that they renew their tax credit claims by 31 July 2018. Claimants who do not renew on-time may have their payments stopped. HMRC has started to send tax credits renewal packs to tax credit claimants and is encouraging recipients to renew their tax credits claim online. All packs should be with recipients by the end of June. A renewal is required if the pack has a red line across the first page and it says, 'reply now'. Claimants need to notify HMRC where there have been changes...

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How much does Class 4 NIC cost?

There are currently two types of national insurance contributions (NICs) payable by most self-employed people. These are known as: Class 2 NICs, and Class 4 NICs. Class 2 NICs are paid by all self-employed taxpayers unless they qualify for the small earnings exception or other exemptions which remove the necessity to pay NICs. Class 2 NICs are payable at a flat weekly rate of £2.95 for the current 2018-19 tax year. Class 2 NICs count towards payments such as the basic state pension, the employment and support allowance, maternity allowance...

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Claiming for job related expenses

Employees who use their own money to buy things they need for their job, can sometimes claim tax relief for the associated costs. It is usually only possible to claim tax relief for the cost of items used solely for work. There is no tax relief available if your employer refunds any costs in full. In addition, you cannot claim tax relief if your employer has provided you with a suitable item, but you want a different or upgraded model. For example, you are provided with a mobile phone for your work, but you want to use a newer and more...

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Don’t forget to handout P60s

The deadline for employers to provide employees with a copy of their P60 form is by 31 May 2018. A P60 must be given to all employees that were on the payroll on the last day of the tax year – 5 April 2018. The P60 is a statement issued to employees after the end of each tax year that shows a summary of their pay and deductions for the previous tax year. Employers can provide the P60 form on paper or electronically. Employees should ensure they keep their P60s in a safe place as it is an important record of the amount of tax they have paid....

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What is a PET?

Most gifts made during a person’s life are not subject to tax at the time of the gift. These lifetime transfers are known as 'potentially exempt transfers' or 'PETs'. These gifts or transfers achieve their potential of becoming exempt if the taxpayer survives for more than seven years after making the gift. If the taxpayer dies within 3 years of making the gift, then the inheritance tax position is as if the gift was made on death. A tapered relief is available if death occurs between three and seven years after the gift is made. PETs have...

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Non-resident landlord’s scheme

The Non-resident landlord (NRL) scheme is a special scheme for the UK rental income of non-resident landlords. This includes companies or trustees whose 'usual place of abode' is outside the UK. HMRC classifies a person living abroad for 6 months or more per year, as a non-resident landlord. Interestingly, this is the case even if the person is a UK resident for tax purposes. Generally, basic rate tax (currently 20%) must be deducted, after expenses, from the rent payable to a non-resident landlord, either by the letting agent or where there...

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Let property disclosure campaign

Landlords that receive letting income should notify HMRC by 5 October after the end of the tax year for which you start to receive that income. So, for the 2017-18 tax year that has just ended, HMRC needs to be notified by 5 October 2018 of any letting income. The Let property campaign, provides landlords who have undeclared income from residential property lettings in the UK or abroad with an opportunity to regularise their affairs by disclosing any outstanding liabilities, whether due to misunderstanding the tax rules or because of...

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EMIs lose tax clearance under state aid

HMRC's recently published, and usually routine, Employment related securities bulletin contains an important announcement on the future of EMI share options. It transpires that the EU state aid approval for the EMI share options scheme expired on 6 April 2018, and the government has yet to obtain a renewal agreement from the EU. HMRC’s bulletin was only published on 4 April 2018 and therefore provided almost no notice to those affected by this announcement. We are told that the government applied to the European Commission for fresh approval...

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Reminder to submit details for Benefits in Kind

Employers are reminded that the deadline for submitting the 2017-18 forms P11D, P11D(b) and P9D is 6 July 2018. P11D forms are used to provide information to HMRC on all Benefits in Kind (BiKs), including those under the Optional Remuneration Arrangements (OpRAs) unless the employer has registered to payroll benefits. This is known as payrolling and removes the requirement to complete a P11D for the selected benefits. However, a P11D(b) is still required for Class 1A national insurance payments. The new OpRA legislation was introduced with...

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