Time to declare offshore income gains and assets warns HMRC

HMRC is urging UK taxpayers to come forward and declare any foreign income or profits on offshore assets before 30 September to avoid higher tax penalties.

New legislation called ‘Requirement to Correct’ requires UK taxpayers to notify HMRC about any offshore tax liabilities relating to UK income tax, capital gains tax, or inheritance tax.

Some UK taxpayers may not realise they have a requirement to declare their overseas financial interests. Under the rules, actions like renting out a property abroad, transferring income and assets from one country to another, or even renting out a UK property when living abroad, could mean taxpayers face a tax bill in the UK.

From 1 October more than 100 countries, including the UK, will be able to exchange data on financial accounts under the Common Reporting Standard (CRS). CRS data will significantly enhance HMRC’s ability to detect offshore non-compliance and it is in taxpayers’ interests to correct any non-compliance before that data is received or be faced with higher penalties.

The most common reasons for declaring offshore tax liabilities are in relation to foreign property, investment income and moving money into the UK from abroad. Over 17,000 people have already contacted HMRC to notify them about tax due from sources of foreign income, such as their holiday homes and overseas properties.

Vacancy for receptionist/administrator at our Wigton Office

We are seeking a full-time experienced receptionist/administrator for our Wigton Office.

The ideal candidate will be conscientious, self-motivated and of smart appearance.  They will also be IT literate having a detailed working knowledge of Microsoft Office.  Please Email your C.V explaining why you are suitable for the role to Andrew Irving wigton@saint.co.uk  by 30th September 2018.

Advisory fuel rates from 1 September 2018

COMPANY OWNED VEHICLES

HM Revenue and Customs have announced revised tax free advisory fuel rates from  1 September 2018 which may be paid for business journeys in a car owned by the business.   Rates for the previous quarter are shown in brackets.

Engine size Petrol Diesel LPG
1,400 cc or less  12p (11p) 7p (7p)
1,600 cc or less 10p (10p)
1,401 cc to 2,000 cc 15p (14p)  9p (9p)
1,601 cc to 2,000 cc 12p (11p)
Over 2,000 cc 22p (22p)  13p (13p) 13p (14p)

These rates may be used in the following circumstances:-

  1. Where employers reimburse for business travel in company cars.
  2. Where employers provide fuel for company cars but employees are required to reimburse the cost of fuel for private use.

 

INPUT VAT CLAIMS ON MILEAGE PAID FOR COMPANY CARS OR EMPLOYEE OWNED VEHICLES

HM Revenue & Customs will accept the above figures for claiming input VAT on fuel for company cars, provided a VAT receipt is available to cover the cost of the fuel.  They will also accept use of the above rates by the employer when calculating input VAT on the fuel element for employees using their own vehicles and claiming mileage under the tax free approved mileage rates for business travel of 45p for the first 10,000 miles and 25p thereafter.

If you have not already done so, please update any spreadsheets you may use.

If you have any queries regarding the above or require any further information please do not hesitate to contact us.

Do I have to be a Saint client to attend BITE 2018?

BITE

Let’s cut to the chase: Can you attend BITE 2018 even if you’re not one of our clients?

The answer is a resounding YES!

Our upcoming free business event BITE is for business owners, plain and simple.

If you run your own business in the north of England (or further afield, if you feel like travelling), you’re bound to find something you’ll love in our packed agenda.

Why should I come along?

To learn, grow, and make better business decisions.

BITE stands for Business, Innovation, Technology, and Efficiency, and we’ve designed our agenda to make sure each aspect gets the spotlight it deserves.

During the course of the day, you will:

●      Be encouraged to embrace a spirit of curiosity and growth, regardless of industry or business type.

●      Get to meet and network with like-minded business owners, the Saint & Co team, and representatives from Xero and the apps.

●      Find out how Xero sits at the heart of your business, and which apps apply specifically to your type of business.

●      Connect with the apps and tech that are perfect for you and your business.

Agenda, BITE 2018

Who’s going to be there?

On the 12th of October, Carlisle Racecourse will be all abuzz with ambitious business owners, advisors, tech experts, and a selection of smart and engaging speakers.

Your next strategic partner could be at the same table. A new client a few tables over. And with dynamic keynote speakers Ashleigh Lambert of Xero, and content marketing duo Andrew & Pete, you’re bound to learn a thing or two, too.

Where is BITE? And when?

Where: Carlisle Racecourse (Get Directions)

When: Friday 12 October 2018, 08:30 – 16:00

Save Your Seat (It’s Free!)

Around 200 businesses will be joining us on the 12th of October for BITE, and you can be there too. Learn how to save time, save money, get found by your ideal client, get paid faster, and so much more.

You’ll even get lunch – and it won’t cost you a penny.

Sound good?

Grab Your Free Ticket Now

Find Out How Cloud Accounting Can Make MTD a Smoother Transition

Making Tax Digital

Technological hitches and Brexit-related delays aside, Making Tax Digital (MTD) is going to happen. One way or another, the UK’s tax system is going digital, and it’s vitally important that you take the correct measures now to avoid scrambling at the last minute two years from now.

In this brief blog post, we explain why switching to cloud accounting today can make MTD a smoother, more effective transition in the future.

A reminder: What is Making Tax Digital?

We’ve previously blogged about what Making Tax Digital is and how it will affect you, but if you’re still not sure, here’s a quick reminder:

Making Tax Digital is a government initiative designed to streamline and simplify tax, and bring about the end of paper accounting for millions across the UK. Instead of a yearly tax return, businesses will be tasked with setting up a digital tax account and filing an online return once per quarter.

If it all works as intended, MTD will make tax more straightforward, accurate, and far less stressful.

Why make the switch now?

From a compliance point of view, if your business does not exceed the VAT threshold, you will not be mandated to keep digital records and submit quarterly returns via digital accounting software. Or, in other words, if you’re not turning over £85,000 and above, you can breathe easy about implementing new software.

However, there’s still an argument that you should make the switch to a cloud-based accounting system well in advance of the inevitable expansion of MTD, set to take place in or around April 2020.

Why? Well, cloud accounting can save you time and save you money. It makes financial admin easier, and will ultimately result in a more effective and efficient tax return, regardless of whether or not your business is compelled to comply with MTD.

It might be tempting to dismiss MTD as yet another HMRC obligation, but the truth is, the move towards a fully digital and largely automated accounting process will improve your business tenfold. You’ll have instant access to real-time, up-to-date numbers which will, in turn, help you make better decisions in your pursuit of growth and profit.

So, the question ought to be “which cloud accounting software do I choose?” and the answer is simple – Xero.

How can Xero help?

Xero is by far the most popular cloud accounting software in the UK – and with good reason. It acts as the financial hub of your business, bringing together important functions such as bookkeeping, accounting, invoicing, and reporting.

Whether you have MTD in mind or not, making the switch to the cloud with Xero will undoubtedly bear fruit for your organisation. In fact, the features and benefits are there for all to see:

  • A clean and clear dashboard provides an at-a-glance overview of your key numbers, meaning you’re always in control.
  • A live bank feed keeps everything up-to-date.
  • Online invoicing means you can invoice directly to customers, log sales straight into Xero, and follow up with late payers in a timely and efficient manner.
  • Financial reports give you the opportunity to see your balance sheet, profit and loss, or cash report at any given time, and all with real-time, accurate numbers.

Where Making Tax Digital is concerned, Xero is already a step ahead. It can:

  • Automatically calculate tax (including VAT and payroll tax).
  • Pull financial data directly from your bank, invoicing software, or point of sale system.
  • Update transactions daily, keeping you on top of bank reconciliation.
  • Create digital records of paper receipts and bills via its smartphone app.

All of this combines to provide you with a clear picture of your business’s financial performance and tax liabilities, keeping you organised and ready to meet your next tax payment, or sidestep your next cash flow concern. In short, by introducing a cloud accounting system like Xero, you’ll take the change to Making Tax Digital in your stride.

Get Ready for MTD with Saint and Xero

There are no two ways about it, change is scary. Especially if it means implementing technology you’ve never used before. But Making Tax Digital could be a huge positive for your business. Filing returns quarterly could make tax less taxing, and allow you the opportunity to better plan for the future.

And by making the switch to Xero, not only will you be prepared for MTD, you’ll also have accurate financial information at your fingertips, helping you spot opportunities and threats faster than ever before.

If this sounds like something you’d be interested in, simply click the link to Get Started with Xero, or call us on 01228 534 371 to chat with one of our friendly advisors.

Welsh income tax starts 6 April 2019

From 6 April 2019, the Welsh Government (like the Scottish Government) will be able to set and vary the rate of Income Tax paid by Taxpayers who live in Wales.

As in Scotland the system will be administered by HMRC. Taxpayers resident in Wales who are employed or in receipt of a taxable pension will have the letter “C” as a pre-fix to their tax code to ensure the correct amount of tax is deducted under PAYE.

Ask Alexa to contact HMRC for help

HMRC has launched new and innovative technology to help more than 3 million customers renew their tax credits. HMRC has developed a customer-focused service through Amazon Alexa specifically for those seeking help with their tax credits renewals.

Customers with Amazon Alexa-enabled devices can ask Alexa to ‘open HMRC’ and ask for help and information with a change of circumstances, payment information, or a renewal. No personal information is stored on Alexa and customers cannot renew their tax credits using Alexa.

It’s just one part of HMRC’s growing online services. Tech-savvy customers can also use the HMRC App on their smartphone to:

  • renew their tax credits
  • check their tax credits payments schedule
  • find out how much they have earned for the year

Spreading the 2019 loan charge

Last month we alerted you to the requirement to register with HMRC by 30 September 2018 in order to settle on preferential terms before the outstanding loan charge arises on 5 April 2019.

This new tax charge applies to any outstanding loans that exist as a result of a disguised remuneration tax avoidance scheme used by your employer such as those involving Employee Benefit Trusts (EBTs).

HMRC have now announced a spreading provision that will allow individual taxpayers with total income of no more than £50,000 in 2018/19 to spread the charge over 5 years

Capital gains tax (CGT) on property sales due within 30 days from 2020

Draft legislation in the next Finance Bill will introduce significant changes to the reporting of residential property disposals and the payment of CGT from 6 April 2020.

Currently non-UK resident taxpayers disposing of UK residential property are required to report the disposal to HMRC within 30 days. The new legislation extends this reporting obligation to UK resident taxpayers and at the same time will introduce a new payment on account regime.

This is yet another attack on buy to let landlords who currently pay CGT on property disposals on 31 January following the end of the tax year in which the disposal took place so this change will be a significant acceleration of the payment date.

Rules for “rent a room” relief to be tightened up from 6 April 2019

HMRC propose to restrict the availability of “rent a room” relief to situations where the taxpayer is living in the let property for at least some of the time that the accommodation is let. Hence renting out a house during Wimbledon fortnight while the owners are absent would not qualify from 6 April 2019!

Rent-a-room relief was introduced in 1992 to encourage individuals to make spare capacity in their homes available for rent. The government intended this to increase the quantity and variety of low-cost rented accommodation, giving more choice to tenants and making it easier for people to move around the country for work.

Currently rent-a-room relief gives relief from income tax for up to £7,500 of gross rental income to individuals who let furnished accommodation in their only or main residence.

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