Archive for the ‘Uncategorised’ Category

State Pension entitlement if you retire abroad

Tuesday, February 6th, 2024

You can claim State Pension abroad if you have paid enough UK National Insurance contributions to qualify.

To make a claim you must be within four months of your State Pension age.

You must choose which country you want your pension to be paid in. You cannot be paid in one country for part of the year and another for the rest of the year.

Your State Pension can be paid into:

  • a bank in the country you’re living in
  • a bank or building society in the UK

 

You can use:

  • an account in your name
  • a joint account
  • someone else’s account – if you have their permission and keep to the terms and conditions of the account

 

You will need the international bank account number (IBAN) and bank identification code (BIC) numbers if you have an overseas account. You will be paid in local currency – the amount you get may change due to exchange rates.

How your future pension may be affected

If you live outside certain designated areas, you may lose out on the annual increases in the UK State Pension.

Your State Pension will only increase each year if you live in:

  • the European Economic Area (EEA)
  • Gibraltar
  • Switzerland
  • countries that have a social security agreement with the UK (but you cannot get increases in Canada or New Zealand)

However, if you have not qualified for annual increases whilst abroad, your pension will go up to the current rate if you return to live in the UK.

Spring Budget 2024

Friday, February 2nd, 2024

The Chancellor of the Exchequer, Jeremy Hunt has confirmed that the next UK Budget will take place on Wednesday, 6 March 2024. This will be the Chancellor’s second Budget and will include the government's tax and spending plans as well as new growth and borrowing forecasts. Various pundits are suggesting that selecting a Budget date in early March leaves the possibility of a general election as early as May 2024. The next general election is required to take place by January 2025.

There may be a round of new tax-cuts and changes as the government works to attract voters and narrow the gap against Labour. Details of all the Budget announcements will be made on a special section of the GOV.UK website which will be updated following completion of the Chancellor’s speech.

The Budget will be published alongside the latest forecasts from the Office for Budget Responsibility (OBR). This forecast will be in addition to that published for the Autumn Statement and fulfil the obligation for the OBR to produce at least two forecasts in a financial year, as is required by legislation.

The OBR has executive responsibility for producing the official UK economic and fiscal forecasts, evaluating the government’s performance against its fiscal targets, assessing the sustainability of and risks to the public finances and scrutinising government tax and welfare spending.

National Insurance and tax after State Pension Age

Friday, February 2nd, 2024

If you have reached the State Pension age and continue to work, in most cases, you no longer need to pay National Insurance Contributions (NICs).

At State Pension age, the requirement to pay Class 1 and Class 2 NICs ceases. However, you will remain liable to pay any NICs due to be paid to you before reaching the State Pension age. If you continue working, you need to provide your employer with proof of your age.

Your employer remains liable to pay secondary Class 1 employer NICs. If you would rather not provide proof of age to your employer, you can request a letter (known as an age exception certificate) from HMRC confirming you have reached State Pension age and are no longer required to pay NICs.

If you are self-employed you will need to pay Class 4 NICs for the remainder of the year in which you reach State Pension age but will be exempt from the following year.

HMRC provides the following example. Someone who reached the State Pension age on 6 September 2023 will stop making Class 4 contributions on 5 April 2024 and pay their final Class 4 bill by 31 January 2025, together with any Income Tax due.

If you have overpaid NICs you can claim the excess back from HMRC.

Year end payroll reporting

Friday, February 2nd, 2024

It is not that long until the current 2023-24 tax year comes to an end and there are a number of year end payroll chores that must be completed. This includes sending a final PAYE submission for the tax year. The last Full Payment Submission (FPS) needs to be submitted no later than the last payday for your employees of the 2023-24 tax year.

It is also important that employers remember to provide employees with a copy of their P60 form by 31 May 2024. A P60 must be given to all employees that are on the payroll on the last day of the tax year – 5 April 2024.

The P60 is a statement issued to employees after the end of each tax year that shows the amount of tax they have paid on their salary. Employers can provide the P60 form on paper or electronically. Employees should ensure they keep their P60s in a safe place as it is an important record of the amount of their earnings and tax paid.

In addition, a P60 is required in order that an employee can prove how much tax they have paid on their salary. For example:

  • to claim back overpaid tax;
  • to apply for tax credits; and
  • as proof of your income if you apply for a loan or a mortgage.

Employees who have left their employment during the tax year do not receive a P60 from their employer, as the same information will be on their P45.

The deadline for reporting any Class 1A National Insurance contributions and submitting P11D and P11FD(b) forms to HMRC for the tax year ending 5 April 2024 is 6 July 2024.

Do you need to register for self-assessment?

Friday, February 2nd, 2024

There are a number of reasons why you might need to complete a self-assessment return. This includes if you are self-employed, a company director, have an annual income over £150,000 and / or have income from savings, investment or property. The £100,000 threshold for self-assessment threshold change for taxpayers taxed through PAYE only, increased from £100,000 to £150,000 with effect from 6 April 2023.

Taxpayers that need to complete a self-assessment return for the first time should inform HMRC as soon as possible. The latest date that HMRC should be notified is by 5 October following the end of the tax year for which a self-assessment return needs to be filed.

HMRC has an online tool www.gov.uk/check-if-you-need-tax-return/ that can help you check if you are required to submit a self-assessment return.

You are required to submit a self-assessment return if any of the following apply:

  • you were self-employed as a ‘sole trader’ and earned more than £1,000 (before taking off anything you can claim tax relief on)
  • you were a partner in a business partnership
  • you had a total taxable income of more than £150,000 in 2023-24 (£100,000 in 2022-23)
  • you had to pay Capital Gains Tax when you sold or ‘disposed of’ something that increased in value
  • you had to pay the High Income Child Benefit Charge

You may also need to send a tax return if you have any untaxed income, such as:

  • money from renting out a property
  • tips and commission
  • income from savings, investments and dividends
  • foreign income.

Tax Diary February/March 2024

Friday, February 2nd, 2024

1 February 2024 – Due date for Corporation Tax payable for the year ended 30 April 2023.

19 February 2024 – PAYE and NIC deductions due for month ended 5 February 2024. (If you pay your tax electronically the due date is 22 February 2024)

19 February 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 February 2024.

19 February 2024 – CIS tax deducted for the month ended 5 February 2024 is payable by today.

1 March 2024 – Due date for Corporation Tax due for the year ended 31 May 2023.

2 March 2024 – Self-Assessment tax for 2022-23 paid after this date will incur a 5% surcharge unless liabilities are cleared by 1 April 2024, or an agreement has been reached with HMRC under their time to pay facility by the same date.

19 March 2024 – PAYE and NIC deductions due for month ended 5 March 2024 (If you pay your tax electronically the due date is 22 March 2024).

19 March 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 March 2024.

19 March 2024 – CIS tax deducted for the month ended 5 March 2024 is payable by today.

Digital labelling of imports

Thursday, February 1st, 2024

Businesses are set to benefit from savings as import labels are made digital for the first time.

  • New legislation to introduce digital labelling for British businesses to cut red tape and save millions in unnecessary regulation costs.
  • Recognition of CE marking continued for products such as toys and machinery, easing burdens to businesses.
  • Digital labelling reforms made possible by Brexit and ensures the UK’s regulatory requirements are fit for the modern world.

The government hopes that digital labelling will allow businesses to place important regulatory or manufacturing information online rather than requiring them to physically print it on their products – saving time and money which can be pushed towards scaling up and growing companies.

This measure has been made possible by leaving the EU and provides greater flexibility than the EU’s regulatory requirements while better reflecting the modern and digital world of business and international trade.

The change follows the Product Safety Review consultation and extensive industry engagement – looking at ways to cut costs while benefitting consumers and ensuring regulatory systems are agile. The move towards digital labelling has been an issue industry has lobbied for consistently.

This comes as part of a wider range of measures covered by the smarter regulation programme, which ensures our laws and regulatory regime are better tailored to the interests of UK businesses, consumers and the economy.

This announcement does not apply to regulations for medical devices, construction products, marine equipment, rail products, cableways, transportable pressure equipment and unmanned aircraft systems, led by relevant government departments.

Update on Companies House changes

Tuesday, January 30th, 2024

Looks like Companies House is morphing from passive registrar into a monitoring agency for the government. Changes that are likely to impact the business community from as early as March 2024 are listed below, extracted from a Companies House blog post, dated 22 January 2024.

 

“The Economic Crime and Corporate Transparency Act became law in October 2023. Since then, we’ve been getting ready to introduce the measures brought in by the act.

“We're aiming to introduce the first set of changes on 4 March 2024. The introduction of these changes needs secondary legislation, so this date is still dependent on parliamentary timetables. It will not be earlier than 4 March 2024. These changes include:

 

  • greater powers to query information and request supporting evidence;
  • stronger checks on company names;
  • new rules for registered office addresses;
  • a requirement for all companies to supply a registered email address;
  • a requirement for all companies to confirm they’re forming the company for a lawful purpose when they incorporate, and to confirm its intended future activities will be lawful on their confirmation statement;
  • the ability to annotate the register when information appears confusing or misleading;
  • taking steps to clean up the register, using data matching to identify and remove inaccurate information; and
  • sharing data with other government departments and law enforcement agencies.”

 

One change from 4 March 2024 that may require action when these new regulations are finally introduced, is the requirement for companies to have an “appropriate” registered office address, no more PO Box numbers.

 

Another change is the requirement to provide Companies House with a registered email address. From 4 March 2024, new companies will need to give a registered email address when they incorporate. Existing companies will need to give a registered email address when they file their next confirmation statement with a statement date from 5 March 2024.

 

You will also need to confirm the company’s intended future activities are lawful on the confirmation statement. The intention of these new statements is to make it clear that all companies on the register, new and existing, have a duty to operate in a lawful way. Companies House may act against your company if they receive information that confirms you are not operating lawfully.

Red Sea disruption to supply chains

Thursday, January 25th, 2024

The Department for Business and Trade (DTI) has launched the Critical Imports and Supply Chains Strategy to safeguard the UK supplies of critical goods such as medicines, minerals and semiconductors. This should help importers counter the effects of the Red Sea disruption.

In their recent press release, the DTI said:

“Imports of critical goods for the NHS and UK manufacturing to be protected from global supply chain shocks, safeguarding business and consumers and boosting the economy.

  • New Critical Imports and Supply Chains Strategy forms key part of government work to back business and grow the economy, helping UK companies build strong and resilient supply chains for vital goods and avoid dependence on protectionist or coercive states.
  • Innovative research will be used to map the impacts of shocks on supply chains, such as those caused by the Covid pandemic and war in Ukraine and understand how the UK can secure the goods we need in future.

“UK supplies of critical goods such as medicines, minerals and semiconductors will be safeguarded, thanks to the Government’s new Critical Imports and Supply Chains Strategy launched today (Wednesday 17 January).

“The recent attacks in the Red Sea, one of the world’s most critical waterways, has threatened global trade. In response to increased geopolitical disruption, and the unprecedented challenges of recent years, like the Covid pandemic, Russia’s invasion of Ukraine and environmental disasters, the UK Government and businesses have boosted their ability to manage supply chain shocks. This strategy builds on this and will further equip UK businesses to deal with global supply chain problems and access the imports they need which are essential to the functioning of the UK.”

More than 100 top UK firms, including pharmaceutical and manufacturing leaders like The Association of the British Pharmaceutical Industry (ABPI), the Society of Motor Manufacturers and Traders (SMMT) and Green Lithium have contributed to the strategy to ensure it helps develop resilient and secure supply chains that protect both their business and the consumers who rely on them.

Minister for Industry and Economic Security Nusrat Ghani will launch the Strategy today during a visit to Heathrow Airport, the largest import hub in the UK which managed more than £86 billion of UK imports in 2022.

Spread the cost of tax payments

Tuesday, January 23rd, 2024

None of us has been exempt from the effects of inflation and cost of living issues in the past year. Which is why taxpayers who are obliged to register for self-assessment will be somewhat apprehensive as the deadline for paying any arrears of tax for 2022-23 and the first payment on account for 2023-24 looms large; both need to be paid by 31 January 2024.

However, according to HMRC, 44,800 taxpayers have already registered with HMRC to repay their tax dues.

They said:

“Those who are unable to pay in full can check online to see if they can set up a monthly payment plan called Time to Pay. If they owe less than £30,000, they can use the affordability checker on GOV.UK to help decide the best arrangements for them. Interest will be applied to any outstanding balances from 1 February.”

This Time to Pay facility is a welcome assist for individuals who simply cannot afford to settle their taxes in full by the 31 January payment date.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

“We want to help Self-Assessment customers meet their obligations and there is no time like the present to choose the right payment option for you. Whether you choose to pay in instalments, via the HMRC app or using online banking, search ‘pay your Self-Assessment tax bill’ on GOV.UK for a full list of options.”

HMRC has also reminded taxpayers to be aware of the risk of falling victim to scams and should never share their HMRC login details or any other personal data with anyone. HMRC scams advice is available on GOV.UK.

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