Month: February 2020
More Great communication from HMRC resulting in panic.
From 6th April this year there are changes to the eligibility for claiming the Employers Allowance. This is worth up to £3,000 and is design to encourage employment. Will you be affected by the changes? Chances are, if you qualify now, probably not.
If you employ people over the primary NI threshold (currently £166pw), or have two directors both being paid above the primary threshold, you currently qualify for the allowance. This is not changing.
If your secondary NI liability for the previous tax year exceeds £100,000 or you receive other State Aid that take you over a defined de minis state aid limit based on your industry sector, then you will lose your EA or have it restricted. For these businesses, the EA does not make a lot of difference or provide the same incentives for which it was intended.
No need to panic!
As the 6th April is getting closer confusion over the implementation of the new rules applying to the private sector remains with HMRC updating guidance, changing the application of the rules and providing assurances that are resulting in more anxieties.
How HMRC will view and treat your position can found with the new and updated employment status checker.
Here you will find links to further guidance whether you are an employer, an intermediary or working through your own PSC.
If your allowable expenses against property income is less than £1,000 you can elect to use the property allowance as partial relief against the income. This allows you to deduct £1,000 from your rental income and is beneficial if your costs are minimal. If the property is owned jointly then each of the joint owners can claim the allowance. If your rents are minimal (less than £1,000) then you can claim full relief and may not even need to complete a self assessment return. You can’t create a loss from the property allowance to carry forward but might be worth considering depending on your circumstances.
Sneaking under the radar come the new tax year is the Property Disposal Return. These have been in place for non-resident landlords for a few years now but from the 6th April will affect all UK residential property owners making a disposal of a property that is not their main residence. The tax due remains unchanged ( subject to next month’s budget of course) but will be payable within 30 days of completion along with a Property Disposal Return. This means that where you had 9 months from the end of the tax year in which the disposal was made, tax will have to be paid within a month of the sale!
Back now after a few days in Iceland. Amazing place. Very fortunate to see the Aurora so clearly. Back to VAT returns and everything else I put off until the end of January. Can’t wait!