Last year the Southport area in Merseyside saw 668 new companies registered in the area.
Now 668 new companies is a lot of new business, at a rate of over twelve per week that is good going by anyone's standards, granted some with be companies who after being dissolved have started again, others could also be people changing their trading status form sole trader or partnership, but even so these are positive signs.
At Holden Associates we saw an increase last year in people starting a business for the first time, some through redundancy and others through choice, but they all had one thing in common, they needed a firm of accountants who could aid them in their new life.
We have now updated our Budget Reports page with our 2013 Budget Report detailing the measures outlined by the Chancellor today, 20 March 2013.
You can access our full 2013 Budget Report by clicking here.
For the full 2013 Budget Report click here.
Following our live twitter coverage of the Budget 2013 today here are some main points:
- Personal allowances – 6 April 2014 increased to £10,000 (6 April 2013 - £9,440).
- Pensions – from April 2016 a flat rate of £144.00 per week.
- Social care costs – a cap of £72,000 cap on the cost of social care.
- Childcare – from the end of 2015 working parents will receive up to £1,200 per child each year towards the cost of childcare costs.
- Homebuyers – the introduction of the new ‘Help to Buy’ scheme.
- Home to Buy scheme – first part- Buyers will put down a 5% deposit and the government will lend up to a further 20% to both first-time buyers and existing homeowners .
- Home to Buy scheme – second part – Those wishing to move up the property ladder but only have a 5% deposit the government through a mortgage guarantee scheme will encourage lenders to offer access to low-deposit mortgages.
- Tax-free employer loan – employers will now be able to lend an employee tax-free up to £10,000 for such things as season rail tickets.
- National Insurance – a new employment allowance cutting small businesses national insurance bill by £2,000 for each employee.
- Main corporation tax rate reduced to 20% from 2015 for larger businesses.
We will have our 2013 Budget Report live on our website tomorrow morning.
HMRC have announced another new campaign, this time it is aimed at individuals who have previously sold a residential property either in the UK or abroad which is not their principal private residence and of which they have not informed HMRC of the sale.
HMRC are clearly looking at when a second property is sold which is not the main residence, on which the disposal proceeds of this asset are subject to capital gains tax on any gain (profit). That said, with the state of the housing market, any sales of second homes in recent years may result in a loss as opposed to a gain.
This is another good opportunity for individuals to put their tax affairs in order. It should be noted that where losses have been made these can be offset against future gains, just be aware of the time limits, you have 4 years from the end of the tax year when you make a loss in which make a claiming, so don't miss the boat.
The campaign commenced on 5 March 2013 and individuals have until 9 August 2013 to notify their intention to make a disclosure with all disclosures being submitted to HMRC by 6 September 2013.
This campaign does not offer any enhanced penalty terms, other than making a voluntary disclosure, and there is no guarantee of immunity from prosecution for the tax offence. With this in mind individuals may wish to consider making a disclosure to HMRC under the terms of the Liechtenstein Disclosure Facility where reduced penalties may be available and an immunity from prosecution secured.
Don’t forget, HMRC have a number of ways to obtain information regarding property transactions, these include Stamp Duty Land Tax forms, Land Registry, third party notices to estate agents and conveyance solicitors, third party notices to banks, information obtained as part of overseas bank initiatives, property websites etc., as you can see there really is little chance to hide, take advantage now and come clean.
We have today updated our website for the new Advisory Fuel Rates from HMRC.
To go to our advisory fuel rates page please click here.
Do you hold a Swiss bank account; if you do and you choose to stay anonymous under the conditions of the United Kingdom ‘UK’ and Switzerland ‘Swiss’ Tax Agreement did you know you could risk putting your family under HM Revenue & Custom’s scrutiny?
The UK/Swiss Agreement which will come into force on 1 January 2013 will create greater transparency around Swiss bank accounts for taxation purposes.
Letters are currently being sent to all Swiss bank account holders with UK addresses outlining a number of options.
One option is to pay a one-off levy of between 21% and 41% on the value of investments (not real estate) on 31 May 2013 and maintain anonymity, thereby avoiding tax scrutiny. This route potentially has serious Inheritance Tax consequences for surviving family members on the death of the account holder.
Another option is to disclose to HM Revenue & Customs the details of the bank accounts and investments and avoid the levy mentioned above; however you will have to pay any unpaid taxes as well as interest and penalties.
Or you can move the funds to another jurisdiction. Subject to when such a transfer takes place the Swiss bank will only have to notify HM Revenue & Customs as to where the funds have been transferred.
It is important that account holders get independent advice from a specialist who is familiar with the terms of the agreement and making disclosures to HM Revenue & Customs.
If you need further guidance please contact us as soon as possible.
Key points from yesterday’s autumn budget:
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Main rate of corporation tax to fall to 21% from April 2014 (Small Companies Rate remains unchanged at 20%)
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A temporary 2 year increase in the Annual Investment Allowance from £25,000 to £250,000 from January 2013
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An extension of the temporary doubling of Small Business Rate Relief for another 12 months from 1 April 2013
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Pensions cap – the amount that can be saved tax free each year will fall from £50,000 to £40,000
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Personal allowance will from 6 April 2013 rise to £9,440 (currently £8,105)
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Higher earners will see the 40% tax rate bite earlier, the rate at which you pay 40% tax will reduce from £42,475 to £41,450
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ISAs are to increase to £11,520 from, April 2013, of which £5,760 can be in cash
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Inheritance threshold will increase in April 2015 to £329,000
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Shares in return for reduced employment rights proposals – draft legislation is to be published on 11 December 2012
For a full copy of the Autumn Statement 2012 please click here.
After a pause from 3 February 2012 to 31 October 2012 for HM Revenue & Customs ‘HMRC’ to review recommendations it has today started the Business Records Checks ‘BRC’ again.
For those who have not heard about this before or forgotten this is what the HMRC website has to say:
Fresh approach to Business Records Checks
Businesses need to keep adequate business records so that they can complete their tax returns correctly.
A pilot programme of Business Records Checks (BRC) began in April 2011. This involved checks by HMRC on the adequacy of Small and Medium-sized Enterprises’ (SMEs) statutory business records. SMEs are businesses with an annual turnover below £30 million who employ less than 250 people.
Up until 17 February 2012, 3,431 BRC had been carried out. These found that 36 per cent of businesses had some issue with their record-keeping of which 10 per cent had issues serious enough to warrant a follow up visit.
Following a review, HMRC announced a fresh approach to its pilot BRC programme on 3 February 2012.
The review of the pilot programme, which included discussions with trade and professional bodies’ representatives, found clear evidence that the programme was effective in improving record-keeping practices amongst SMEs. However, it recommended that the checks were better targeted in future, and linked to wider education and support activities.
In order to implement the review’s recommendations all new BRC activity was paused from 3 February to 31 October 2012 to allow HMRC to redesign the BRC process.
Read the full report of the Business Records Checks Review (PDF 145K)
Overview of new approach to BRC
A new approach to BRC started on 1 November 2012. Customers who are more likely to be at risk of having inadequate records will be contacted by letter to arrange for HMRC to call them to go through a short questionnaire.
Depending on the outcome of this call, HMRC will confirm to some customers that no further action is required. Where some issues are identified, customers will be offered targeted self-help education options. Customers who are assessed as being at risk of keeping inadequate records will be referred for a BRC visit.
Useful Information
Business Records Checks
So how has the process changed? Simply put HMRC will now:
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Write to those Small and Medium sized Enterprises ‘SMEs’ selected for a BRC.
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Telephone the selected SMEs to talk through their business record keeping. The call is expected to last 10 – 15 minutes.
Based on the responses received, HMRC will then:
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Assess whether a face to face BRC visit is required.
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If the business records are deemed to be adequate, the HMRC officer making the call will tell the SME and then confirm the decision in writing.
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If the business records are deemed to require improvement, an HMRC officer from the Business Education and Support Team will make contact with the SME.
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If the business records are deemed to be inadequate and a visit required, the HMRC officer will ask one of their colleagues on the booking team to call to make the arrangements.
This appears to be very similar to the traffic light system used by HMRC prior to the suspension. Adequate records were given the green light, records in need of improvement were given the amber light and inadequate records awarded a red light.
HMRC recovers more than £1 million from investigations into freelancers underpaying tax, the number of enquiries into whether freelancers are caught under the IR35 rules has doubled to more than 50.
Remember both Employees and Employer would normally pay more tax and national insurance than that paid when paying a freelancer working through their own personal service company.
According to Accountancy Age – Reports suggest that the increase in HMRC’s interest in chasing down those it believes are caught under IR35 correlates with details that emerged of freelancers operating within their own companies while working with the BBC.
From 1 October 2012 the national minimum wage rates will be as follows:
Aged 21 and above £6.19 (2011 – £6.08)
Aged 18 to 20 (inc) £4.98 (2011 – £4.98)
Training Rate:
Aged 16 and 17 £3.68 (2011 – £3.68)
Apprenticeship Rate £2.65 (2011 – £2.60)
For more information please click here.
