2016 Tax Questionnaires
Shortly each of you will be receiving your tax questionnaires and it is important you fill them in correctly as the information on them is used on your personal tax returns for 2016. If there are any questions that you are not sure about, please ring the office and get clarification as any errors or omissions can result in fines penalties or both from HMRC. This is an important document so please take care with it.
Insurance against HMRC Investigation.
Our link with National Organisation Taxwise enables us to offer you an inexpensive insurance against investigation by HMRC. We will be sending you an invoice in May and for a few pounds you can have peace of mind if HMRC come calling. This covers all our time dealing with the enquiries on your behalf whether the enquiry is in to your accounts, your payroll, your personal tax or your VAT. If this happens to you at least you know you will have nothing to pay for the work done by us to answer any enquiry. This insurance is purely voluntary so if you do not feel it is necessary then do not purchase it. With HMRC investigations and penalties on the increase getting the insurance may well be the best investment you make this year. If you did not take out the policy last year give it some serious thought and if you did, then take it out again and continue to sleep easily!
The tax free personal allowance is increasing to £11,500 from April 2017
Business rates relief for small businesses has been expanded and made permanent. Make sure you are paying the correct tariff.
Capital gains tax has been reduced to 20% for higher rate tax payers and 10% for basic rate taxpayers but does not apply to sale of residential properties.
New life time ISAs are introduced from April 2017 for people between 18 and 40 they look extremely attractive but as usual the devil will be in the detail when the full information is released.
The new living wage of £7.20 per hour came in force on 01/04/2016 for all over 25 year olds. If you have your payroll done by ourselves you will have been informed separately, if your payroll is done by yourselves or a third party make sure this has been dealt with.
Life insurance policies are regularly taxed when the policy holder dies and most people are not even aware this happens. This can be avoided by having the policy written differently. We are working alongside Grapevine Financial Services who specialise in this area. So if you want to review your mortgage protection, key-man insurance or employer’s liability insurance we can get them to ensure you have the right policy the right cover and the right price.
New Tax Year New Tax
Remember that in the current tax year only the first £5000 of dividends are tax free so all of you have been taken a wage and dividends need to be aware of this. If you would like to discuss and clarify this and re plan how you take your income, then give us a call and we can see what the best options are for you going forward.
Good News: There will be no tax deducted from bank interest from 6/4/2016 and the first £1000 of interest is tax free for basic rate tax payers.
Bad News: you will need to invest £100,000 to earn that £1000 in interest.