fpdteam, Author at Bennetts Accountancy

Free company information

19th May 2022 by fpdteam

There is a significant amount of information about companies that can be obtained from Companies House. Companies House is responsible for incorporating and dissolving limited companies, examining and storing company information and making company information available to the public.

Much of this information is available at no cost. This is in line with the government’s commitment to free data and means that all publicly available digital data held on the UK register of companies is accessible free of charge. These records provide access to over 170 million digital records on companies and directors.

This includes:

company information, for example registered address and date of incorporation
current and resigned officers
document images
mortgage charge data
previous company names
insolvency information

There is also a service called WebCHeck that allows you to view a company's filing history and purchase copies of document images, as well as a selection of company reports, for a nominal fee. You can also elect to monitor a company and receive email alerts of any new documents filed at Companies House. This can also be a useful facility to check on filings made for your own company(ies).

Source:Companies House| 16-05-2022

UK Infrastructure Bank set-up

19th May 2022 by fpdteam

The UK Infrastructure Bank Bill, announced as part of the measures in the Queen’s speech, represents the final step in setting up the UK Infrastructure Bank as an operationally independent institution. The new Bank officially opened for business in June 2021 but the Bill will remove legal obstacles so the Bank can lend directly to local authorities and the Northern Ireland Executive for infrastructure projects.

The Bank, headquartered in Leeds, is tasked with accelerating investment into ambitious infrastructure projects, cutting emissions and levelling up every part of the UK. The establishment of the Bank is expected to result in a long-lasting public institution helping to drive growth across the UK.

Since its launch, the Bank has completed five deals, including financing the UK’s largest solar farm in South Wales, investing £100 million to provide high-capacity broadband to around 500,000 properties in hard-to-reach UK premises and a further £50 million to improve digital connectivity for rural homes and businesses across Northern Ireland.

The bank started with an initial financial capacity of £22bn made up of £12bn in capital and £10bn in government guarantees. This is expected to unlock more than £40 billion of overall investment in local government lending and to the private sector.

Source:HM Treasury| 16-05-2022

Access to cash protection increased

18th May 2022 by fpdteam

The new Financial Services and Markets Bill, announced as part of the Queen's speech, will provide increased protections for those still dealing with cash. Access to cash remains vital for many people across the UK, including the more vulnerable in society. The government has committed to preserving the use of cash as an option even as the UK becomes more reliant on digital banking and payments.

The new Bill will support consumers by protecting access to cash and help ensure the continued availability of withdrawal and deposit facilities across the UK. The Bill will also enable the Payment Systems Regulator to require banks to reimburse authorised push payment (APP) scam losses, protecting individuals who are the victims of fraud.

HM Treasury has published the following listing of the main elements of the Bill:

Revoking retained EU law on financial services and replacing it with an approach to regulation that is designed for the UK. This includes the Solvency II legislation governing the regulation of insurers, which the government has committed to reform.
Updating the objectives of the financial services regulators to ensure a greater focus on growth and international competitiveness.
Reforming the rules that regulate the UK’s capital markets, the engine of the UK economy, to promote investment.
Ensuring that people across the UK continue to be able to access their own cash with ease.
Introducing additional protections for those investing or using financial products, and to make it safer and support the victims of scams.

More details will be available when the Bill is formally introduced.

Source:HM Treasury| 16-05-2022

Income excluded from a property business

12th May 2022 by fpdteam

HMRC publishes a list of income streams that are excluded from a UK property business. The list includes fishing concerns, hotels and guest houses, tied premises, caravan sites, lodgers and tenants in your own home, extra services to tenants and letting surplus trade accommodation. In most cases the income from these activities will be taxed as income of a trade and not as property income.

In addition, there are certain receipts that can arise out of the use of land, and which are specifically excluded by statute from a rental business. These include yearly interest, income from the occupation of woodlands managed on a commercial basis, income from mines and quarries and income from farming and market gardening.

There is also a £1,000 property income allowance that applies to income from property (including foreign property). If a taxpayer’s annual gross property income is £1,000 or less the amount is exempt from tax and does not need to be reported on their tax return.

Source:HM Revenue & Customs| 09-05-2022

Structures and Buildings Allowances

12th May 2022 by fpdteam

The Structures and Buildings Allowances (SBA) allows for tax relief on qualifying capital expenditure on new non-residential structures and buildings. The relief applies to the qualifying costs of building and renovating commercial structures.

The relief was introduced in October 2018 at an annual capital allowance rate of 2% on a straight-line basis. The annual rate was increased to 3% from April 2020, and the corresponding period reduced to thirty-three and one-third years.

HMRC’s guidance sets out the process for making a claim. In order to make a valid claim a written allowance statement is required.

The allowance statement must include:

information to identify the structure, such as address and description
the date of the earliest written contract for construction
the total qualifying costs
the date that you started using the structure for a non-residential activity

The claimant must also meet the necessary requirements in respect of the building itself and the chargeable period for the claim.

The start date of the claim is the later of the following two dates:

the date when you started using the structure for a qualifying activity
the date that you are due to pay for the structure or construction.

No relief is available where parts of the structure qualify for other allowances, such as plant & machinery allowances.

Source:HM Revenue & Customs| 09-05-2022

ISAs 2022-23

12th May 2022 by fpdteam

The maximum amount that can be invested in an ISA in the current (2022-23) tax year is £20,000.

ISA’s are a valuable and flexible relief and should be considered as an option for most investors.

An ISA is a tax-exempt savings account available to UK residents. Whilst the amount invested in an ISA does not benefit from tax relief the income and gains are free from most taxes including Income Tax and Capital Gains Tax. Eligible holdings include cash ISAs, stocks and shares ISAs and innovative finance (including peer-to-peer loans) ISAs.

There is no minimum period for which an ISA must be held, and you can make withdrawals at any time without the loss of tax relief. The £20,000 limit can be used in one account or split across diverse types of ISA’s.

It is also possible for qualifying taxpayers to invest up to £4,000 of the £20,000 ISA limit in a Lifetime ISA. The Lifetime ISA is available to those aged between 18 and 40 to save for a new home or for their retirement. Under the scheme, the government provides a 25% bonus on yearly savings of up to £4,000 and once you start saving before you are 40, you can continue using the scheme until you turn 50. If you are approaching the age limit cut-off it is well worth opening a Lifetime ISA before you turn 40 as you can continue saving until the day before you are 50. The money invested in a Lifetime ISA can be used for other purposes but will be subject to a 25% withdrawal charge.

There are also Junior ISAs available for under 18’s which were introduced to encourage children to save money. The returns from Junior ISAs are also tax-free and are usually locked until the child reaches 18. The annual subscription limit for Junior ISAs is currently £9,000.

Source:HM Revenue & Customs| 09-05-2022

When you are required to register for PAYE

12th May 2022 by fpdteam

There are a multitude of rules that new businesses must follow when they start employing staff for the first time. These include ensuring registering for PAYE as an employer with HMRC. This must be done before the first payday and this process must even be completed by directors of a limited company who are employed by the company.

There is no requirement to register as an employer in the event that none of your employees are paid more than £123 a week, don’t receive expenses or benefits and don’t have another job or get a pension. However, even if this was the case you are still required to keep payroll records.

Setting up payroll for the first time can be daunting and we are here to help. As a general rule you have the choice between using a payroll provider or running your own payroll. If you decide to run your own payroll you must choose suitable payroll software.

HMRC also needs to be sent information about tax and other deductions from employees’ pay when the employee is paid. This is done using the Real Time Information (RTI) system which involves employers sending HMRC information each tax month. Tax months run from the 6th of one month to the 5th of the next.

You must also ensure that you are complying with the minimum wage legislation, check that any new employees have the legal right to work in the UK and to be aware that you will be required to offer a workplace pension scheme.

Source:HM Revenue & Customs| 09-05-2022

Holiday lets occupancy check

12th May 2022 by fpdteam

The furnished holiday let (FHL) rules allow holiday lettings of properties that meet certain conditions to be treated as a trade for tax purposes.

In order to qualify as a furnished holiday letting, the following criteria need to be met:

The property must be let on a commercial basis with a view to the realisation of profits. Second homes or properties that are only let occasionally or to family and friends do not qualify.
The property must be located in the UK, or in a country within the EEA.
The property must be furnished. This means that there must be sufficient furniture provided for normal occupation and your visitors must be entitled to use the furniture.

In addition, the property must pass the following three occupancy conditions.

Pattern of occupation condition. The property must not be used for more than 155 days for longer term occupation (i.e., a continuous period of more than 31 days).
The availability condition. The property must be available for commercial letting at commercial rates for at least 210 days per year.
The letting condition. The property must be let for at least 105 days per year and homeowners should be able to demonstrate the income from these lettings.

Where there are a number of furnished holiday lettings properties in a business, it is possible to average the days of lettings for the purposes of qualifying for the 105 days threshold. This is called an averaging election.

There is also a special period of grace election which allows homeowners to treat a year as a qualifying year for the purposes of the furnished holiday let rules where they genuinely intended to meet the occupancy threshold but were unable to do so subject to a number of qualifying conditions.

Source:HM Revenue & Customs| 09-05-2022

Reminder to look out for tax credit renewal packs

12th May 2022 by fpdteam

HMRC is currently sending the annual tax credit renewal packs to some 2.1 million tax credit claimants and is encouraging recipients to renew their tax credits claim online. HMRC started writing to taxpayers at the end of April and expects all packs to be with recipients by 27 May 2022.

A renewal is required if the pack has a red line across the first page and it says, 'reply now'. Families and individuals that receive tax credits should ensure that they renew their tax credit claims by 31 July 2022. Claimants who do not renew on-time may have their payments stopped. Around 630,000 taxpayers are expected to receive these packs and can renew their tax credits via GOV.UK or on HMRC’s app.

If the renewal pack has a black line across the front page and says, ‘check now’ then you will need to check your details are correct. Taxpayers need to notify HMRC where there have been changes to the family size, childcare costs, number of hours worked and salary. Details of previous year's income also need to be completed on the form to allow HMRC to check if the correct tax credits have been paid. Claimants must also inform HMRC of any changes in circumstances not already reported during the year such as new working hours, different childcare costs or changes in pay.

Taxpayers are not required to report any temporary falls in their working hours as a result of coronavirus. They will be treated as if they are working their normal hours until the Coronavirus Job Retention Scheme closes.

Universal credit is expected to fully replace tax credits, and other legacy benefits (including Income-Related Employment and Support Allowance, Income-Based Jobseeker’s Allowance) by the end of 2024. HMRC restarted their managed migration process on 9 May 2022. This process was paused during the pandemic. This means that claimants will gradually be notified when required to move to Universal Credit. This process is due to be completed by 2024. Claimants can also elect to move from tax credits to Universal Credit if they would be financially better off. An independent benefits calculator can be used to check.

Source:HM Revenue & Customs| 09-05-2022

IHT business asset relief

5th May 2022 by fpdteam

There are a number of reliefs available that can reduce liability to IHT if you inherit the estate of someone who had died. One of these reliefs is known as Business Relief and is a valuable tax relief for taxpayers with business interests, offering either 50% or 100% relief from IHT on the value of the business assets if certain conditions are met.

100% Business Relief can be claimed on a business or interest in a business or on shares held in an unlisted company.
50% Business Relief can be claimed on:
– shares controlling more than 50% of the voting rights in a listed company
– land, buildings or machinery owned by the deceased and used in a business they were a partner in or controlled
– land, buildings or machinery used in the business and held in a trust that it has the right to benefit from

Relief is only available if the deceased owned the business or asset for at least 2 years before they died. There are a number of restrictions to the relief, for example if the company in question mainly deals with securities, stocks or shares, land or buildings, or in making or holding investments. In some cases, partial Business Relief may be available.

Source:HM Revenue & Customs| 02-05-2022