A STAFF SUMMER PARTY CAN BE A TAX-FREE BENEFIT

Does your organisation have an annual Christmas party for staff?  The tax rules also allow other staff parties which are a tax-free benefit if certain conditions are satisfied. The exemption applies to an annual party (for example, a Christmas party), or similar annual function (for example, a summer barbecue). It must be provided for employees...

MAKE SCHOOL HOLIDAYS EASIER WITH TAX-FREE CHILDCARE

Did you know there is a government scheme available that can help contribute towards childcare costs? This may mean fewer of your employees will need time off at the same time this summer. Tax-Free Childcare is a scheme available to working parents with children from 0-11 years. Unfortunately many parents aren’t taking advantage of the...

REQUEST THAT THE PENSION CHARGE IS PAID BY YOUR FUND BY 31 JULY

The Pension Annual Allowance tax charge depends on the individual’s marginal rate of tax. Where their income exceeds £150,000 it would be at 45%. Thus if the pension input for 2018/19 Was £40,000 and the limit is tapered to £10,000 the excess of £30,000 would incur a £13,500 tax bill on top of their normal...

REPORTING THE ISSUE OF SHARES OR OPTIONS TO STAFF

Gifts and awards of shares in companies, often known as employment related securities (ERS) are commonly used by employers to reward, retain or provide incentives to employees. They can be tax advantaged or non-tax advantaged. You must notify HMRC of all new ERS schemes including one-off awards or gifts of shares by 6 July following...

HIGH INCOME CHILD BENEFIT CHARGE AND STATE PENSION

Last month we looked at tax planning to minimize or eliminate the high income child benefit charge to keep both husband and wife (or civil partners) looking after a child below the £50,000 threshold. Where the income of one of the individuals exceeds £60,000 such that the whole of the child benefit is taxed they...

“RENT A ROOM” RELIEF TO CONTINUE FOR AIR BNB LANDLORDS BUT POSSIBLE CHANGES TO CGT PRIVATE RESIDENCE RELIEF

Last year HMRC carried out a review of rent a room relief. It was proposed that the availability of this generous relief would be restricted to situations where the taxpayer was resident for at least part of the time when the “lodger” was paying rent. The rent a room relief scheme currently exempts from tax...

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. There has been no increase in that threshold since the High Income Child Benefit Charge was introduced in 2013/14. The charge applies if you...

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. This means that where the company has not used this allowance it may be set against...

DISGUISED REMUNERATION LOAN CHARGE STARTS APRIL 2019

This new charge will apply to certain loans to directors and employees that are still outstanding at 5 April 2019 and new arrangements put in place after that date. The charge affects arrangements involving loans made via Employee Benefit Trusts (EBTs) and similar disguised remuneration schemes adjudged by HMRC and the courts to be tax...

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...