Forthcoming major changes to tax reporting
Businesses need to consider 'making tax digital' from April 2019. This applies to businesses (sole traders, partnerships and limited companies) where the turnover is above £85,000.
From April 2019 it will initially apply to VAT returns only. It will mean that manual cashbooks will no longer be acceptable.
Metsons is now able to offer advice in this area so please let us know if you require any assistance.
Tax rules are constantly changing and the topical issues in 2019/20 are as follows;
- dividend tax
- reduction in rates for capital gains tax for individuals to 20% for higher rate taxpayers and 10% for basic rate taxpayers. Please note that for 2nd residential homes, the rates remain at 28% and 18%.
- reduction in rates for corporation tax over the next 3 - 4 years
- National Insurance allowance to £3,000 for employers (but removal for single employee payrolls)
- increase in stamp duty for additional residential properties
- restriction in interest that can be claimed on buy-to-let mortgages. For 2018/19 only half of the mortgage interest qualifies for full tax relief
- removal of wear and tear allowance on buy-to-let properties
- changes to allowances on business vehicles and increases in the benefit in kind taxation. Hybrids and electric cars now have to be considered as a company car as pure diesel/petrol is not really an option
- increase in the living wage from April 2019
- increase in the percentage contributions on auto enrolment from April 2019
2018/19 tax returns
The 2018/19 tax year finishes on the 5 April 2019. The tax return, and payment of tax, is due to HMRC before the 31 January 2020. If you miss the deadline you will incur a £100 fine and interest on any unpaid tax.
This above information is for general guidance only. No liability is accepted for acting upon or refraining from acting upon the above.