Coronavirus

The information available to individuals and businesses is available on the government website

 

https://www.gov.uk/coronavirus/business-support

 

We are happy for clients and non-clients to call us for a review of their entitlements.

 

Tax planning

Tax rules are constantly changing and the topical issues in 2020/21 are as follows;

 

- dividend tax

 

- rates for capital gains tax for individuals are 10% for basic rate taxpayers and 20% for higher rate taxpayers.  Please note that for 2nd properties that are residential, the rates remain at 28% and 18%.

 

- for sale of residential buy-to-lets after 6 April 2020 the tax is due within 30 days of completion and not on the normal due dates for self assessment

 

- National Insurance allowance to £4,000 for employers (but removal for single employee payrolls)

 

- restriction in interest that can be claimed on buy-to-let mortgages.  For 2019/20 only one quarter of the mortgage interest qualifies for full tax relief.  In this tax year (2020/21) none of the interest is allowed to be deducted against income

 

- 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

 

- No benefit in kind for 2020/21 on fully electric cars.  Full 100% write off on the cost of an electric car against profits

 

- increase in the living wage from April 2020

 

 

2019/20 tax returns

The 2019/20 tax year finishes on the 5 April 2020.  The tax return, and payment of tax, is due to HMRC before the 31 January 2021.  If you miss the deadline you will incur a £100 fine and interest on any unpaid tax.

 

Expected changes in the forthcoming March 2021 budget

One area that is expected to change is increases in the rates of tax for capital gains.  We have been working with clients advising them to bring forward transactions before the March 2021 budget.

 

 

 

 

This above information is for general guidance only.  No liability is accepted for acting upon or refraining from acting upon the above.