Strategies for saving tax ahead of the 5 April year end

With the end of the 2017/18 tax year approaching, now may be the ideal time to think about strategies to help mitigate your tax liability. There are many different options to consider so do contact us for further advice.

Reducing your personal tax liability…

Are you making the most of your tax-free personal allowance (PA)? Individuals are entitled to their own PA, which is set at £11,500 in 2017/18. Therefore, if your spouse or partner has little or no income, you could stand to benefit by spreading your income more evenly to ensure that each PA is being fully utilised.

Some married couples may also be eligible to transfer 10% of their PA to their spouse under the Transferable Tax Allowance, or ‘Marriage Allowance’. It means £1,150 may be transferred in 2017/18, which could help to reduce a couple’s tax liability by up to £230 in this financial year. Certain rules apply.

And despite relatively low interest rates, for many individuals ISAs are still an attractive tax-free way to save. For 2017/18, the overall subscription limit for ISAs is £20,000, of which no more than £4,000 can be deposited into a Lifetime ISA. With a range of ISAs to choose from, you have until 5 April 2018 to make your 2017/18 ISA investment.

… and your business’s tax bill

Are you maximising claims for capital allowances? The majority of businesses are able to claim a 100% Annual Investment Allowance on the first £200,000 of expenditure on most types of plant and machinery (except cars). In many cases, a purchase made just before the end of the current accounting year will mean that the allowances are available a year earlier than if the purchase was made just after the year end.

Business owners may also wish to consider tax-efficient ways in which they can extract profit from their business. There are many ways to achieve this. Some may opt to take dividends instead of a salary or bonus, as these are paid free of national insurance contributions. Others may wish to talk to us about incorporating their business, while employer pension contributions can be another tax-efficient means of extracting profit.

As always, it is important to seek our advice before taking action. For more information on tax-saving strategies to implement ahead of the 5 April 2018, please visit the Hot Topics section of our website.

Government proposes replacing self assessment penalties with new points-based system

The £100 penalty regime for filing a late tax return could be scrapped and replaced with a new ‘driving licence-style’ points system, HMRC has revealed.

Under the current system, taxpayers who fail to submit their tax return by the 31 January deadline are liable to an instant £100 fine, with further penalties applying for prolonged delays.

Under new plans being considered by the tax authority, taxpayers who miss the self assessment filing deadline could receive points instead of an immediate fine. Only those taxpayers accruing too many points would then be penalised. Individuals would also see points wiped from their record after a set period of time.

It is thought that around 840,000 taxpayers missed the filing deadline in the last tax year.

The new ‘holistic’ approach is intended to focus on taxpayers who persistently break the rules rather than those who make genuine errors of judgement.

The proposals are included in the Treasury’s Red Book, which states: ‘The government will reform the penalty system for late or missing tax returns, adopting a new points-based approach. It will also consult on whether to simplify and harmonise penalties and interest due on late payments and repayments’.

HMRC intends to consult on the plans, and must seek approval from Parliament. If approved, the new points-based system could undergo a phased introduction for different taxes.

However, some experts have warned that the abolition of the £100 late filing penalty could have ‘unintended consequences’.

The Association of Taxation Technicians (ATT) warned that a new points system could generate anomalies, and has urged the government to ensure that the consultation details exactly how the new system would work, in order to avoid such anomalies.

We can help to ensure that your tax returns are filed accurately and on time – please contact us for further assistance.

Recommended App – TAX READY

TAX READY

With cloud-based technology becoming a feature of everyday life, businesses are wise to implement good, modern software and apps where possible. The right apps can simplify your life and work; improving efficiency and profitability (time is money)!

So, continuing with our regular app recommendations, this month we’d like to recommend TAX READY – our very own, brand new app!

What is it?

Tax Ready is a smartphone app (available on Apple, Android and Windows devices). It has been designed with business owners and managers in mind; providing a range of useful tools to help with the operational aspects of running a business.

How much does it cost?

£0 – it’s free!

What are its features?

  • Tax calculators – there’s a calculator for almost everything but, as an example, the income tax and NI calculator enables you to work out the gross cost of employing a new staff member – or help your employees to understand their net pay.
  • Tax tables – quick access to up-to-date tax rates.
  • Key tax dates – keep track of deadlines and easily add them to your phone’s calendar (just one-click and the reminder’s there) .
  • News – regular news articles on a variety of useful topics.
  • Mileage and expense recording – keep track of your mileage and expense claims whilst on the move, then download them as a spreadsheet when required.

Why do we recommend it?

Although somewhat biased, we genuinely believe the app is a useful resource for our clients and contacts. We think it’s easy to navigate, has a fresh, modern design, and it’s free!

How do I get the app?

To add the app to your device, search ‘Tax Ready’ in your app store … then download and enjoy exploring the features.

 

 

 

Our new app – Tax Ready – is now available to download!

Our brand new smartphone app – Tax Ready – is now available to download on Apple, Android and Windows devices!

Created with business owners and managers in mind, Tax Ready provides key tax rates and convenient access to a range of useful tax tools, news and tips in one app.

The app comes with tools such as mileage and expense trackers – which make it easy to keep a track of your claims whilst on the move.

To find the app, search ‘Tax Ready’ in your app store. It’s completely free to download and use.

We hope you find it a useful and informative resource.

Recommended App – Zoom

ZoomLogoBlue_copyFollowing last month’s article (the first in our series of monthly app recommendations), our featured app for July is:

ZOOM

What is it?

Zoom is a video conferencing solution which can be used on your desktop, tablet or mobile. It can be used for 1 to 1 video meetings, conference calls or to host webinars.

How much does it cost?

The pricing structure is staggered for different requirements but the basic version is free.

Features

The free version enables 1 host (the person holding the meeting/the account holder) to have group video meetings with up to 100 participants, for up to 40 minutes. The host can arrange as many 1 to 1 meetings as they like (without a time limit)… The 40 minute limit only applies to group meetings of 3+.

Meeting attendees (i.e. people that the host has invited to join), don’t need a Zoom account to participate – they just need a meeting code or link to join.

If required, the meeting host can share their desktop/screen with attendees.

Why we recommend it

  • It’s quick and simple to install and use on any device. We’ve generally used it on the I Pad app – which is very intuitive and easy to navigate.
  • It has some very clever features. For example, in group meetings, the picture automatically switches to the person that is speaking (i.e. you don’t have lots of small faces on the screen at once – just the face of the person that is talking).
  • If the video link fails, or connectivity is poor for an attendee, they can dial into the meeting by telephone using a VOIP number that is generated for the meeting.
  • Scheduling meetings and inviting attendees is really easy and looks smart and professional.
  • The free version is great but the ‘small business’ version (£11.99 per month per host) also provides an affordable solution with great additional features.

 

 

Recommended App – Wunderlist

 

 

 

 

 

 

 

With cloud-based technology becoming a feature of everyday life, businesses are wise to implement good, modern software and apps where possible.

The right app can simplify your life and work; improving efficiency and profitability (time is money)!

So, to help you choose the right solutions for YOUR business, we’ll be recommending a tried and tested app each month.

This month, our featured app is:

WUNDERLIST

What is it?

A to-do list app (available on iOS and Android)

How much does it cost?

£0 – It’s free!

Features

  • Users can create any number of to-do lists for projects, tasks, shopping lists, read-lists etc.
  • Items can also have sub-tasks (to add specifics/finer details).
  • A due date/deadline can be set for tasks. Reminders can pop up as push notifications or they can be sent by email.
  • Lists can be shared with other users to create shared projects or to delegate tasks.
  • It works across all devices (there’s also a desktop version as well as the app) and syncs seamlessly and instantly between them.

Why we recommend it

  • It’s very easy to use; intuitive and simple.
  • It’s free… but there are no annoying adverts.
  • It makes a very satisfying ‘ding’ when you tick off a completed item.
  • The due-dates help with prioritisation and ensure you/your team members keep on top of tasks.
  • The instant syncing across all devices make it accessible and ready to use wherever you are.
  • The shared lists are incredibly useful for team project work.