Taxation of Dividend Payments in 2019/20

Traditional advice would then be to extract any additional profits from the company in the form of dividends. Where dividends fall within the basic rate band (now £37,500) the rate continues to be 7.5% after the £2,000 dividend allowance has been used. Thus where husband and wife are 50:50 shareholders they would each pay £2,663 […]

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Advisory fuel rate for company cars

In line with recent reductions in fuel prices, HMRC have reduced their suggested reimbursement rates for employees’ private mileage using their company car from 1 March 2019. Where there has been a change the previous rate is shown in brackets. Note that for hybrid cars you must use the petrol or diesel rate. You can […]

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Tax planning to minimise the high income child benefit charge

The substantial increase in the higher rate threshold to £50,000 is good news for many taxpayers. However, that same figure is the point at which child benefit starts being clawed back and there has been no increase in that threshold since the High Income Child Benefit Charge was introduced in 2013/14. The charge applies if […]

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Changes to personal allowance and tax bands

The personal allowance and the higher rate tax threshold increased on 6 April 2019. The personal allowance has risen to £12,500 and the basic rate band to £37,500, which means that for most taxpayers the higher rate tax threshold will be £50,000. These thresholds were due to come into effect from 6 April 2020 but […]

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Extracting profit from the family company

The start of the new tax year means that shareholder/ directors may want to review the salary and dividend mix for 2019/20. The £3,000 employment allowance continues to be available to set against the employers national insurance contribution (NIC) liability which means that where the company has not used this allowance it may be set […]

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Corporation Tax Relief back for Acquired Goodwill

A further late change to the finance bill will reintroduce relief for acquired goodwill on the acquisition of businesses with eligible property from 1st April 2019. This relief was withdrawn back in July 2015 and the restoration of relief for goodwill is very welcome although the new form of relief will be more restricted. The […]

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Buy new equipment before 6th April?

Your business year end, not 5th April, is relevant for capital allowances purposes. If however you are running a business and making up accounts to 31st March or 5th April, you should consider buying plant and machinery to take advantage of the Annual Investment Allowance (AIA). Note that the AIA was increased from £200,000 to […]

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Passing on the family home

New inheritance tax rules for passing on the family home started on 6th April 2017. This additional relief should be taken into consideration when drafting your Will and we can work with your solicitor to make sure your Will is tax efficient. From 6th April 2017 an additional nil rate band of up to £175,000 […]

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Pension Planning

For most taxpayers the maximum contribution is £40,000 each tax year, although this depends on their earnings. This limit covers contributions by both the individual and their employer. Note that the unused allowance for a particular tax year may be carried forward for three years and can be added to the relief for the current […]

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VAT Registration limit continues to be frozen

The VAT registration limit normally increases in line with inflation each year. However, It was announced last year that the limit would be frozen at £85,000 until 1st April 2020. It has now been announced that the limit will now remain at the same level until 2022.  The deregistration limit will remain at £83,000.

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