HomeSelf-assessment registration reminderSelf-assessment registration reminderIndividuals who registered as self-employed during the 2016/17 tax year have until 5 October 2017 to register with HMRC for self-assessment. Research by resource platform Informi found 1 in 4 small business owners have previously failed to submit their tax returns on time, with 7% missing the 31 January deadline on multiple occasions.Registration for self-assessment is done via the HMRC website.Once completed, you will receive a 10-digit unique taxpayer reference to complete your self-assessment tax return. Failure to meet the registration deadline can lead to penalties imposed by HMRC. This can amount to up to 30% of the tax bill which is owed, unless this is paid in full by the online tax return deadline of 31 January 2018.However, the average fine for those missing the deadline in the Informi study was £284.56.13% of the late returners polled faced a penalty charge which exceeded £500, with another 2% fined more than £800. All your income received during the tax year running from 6 April to 5 April must be accounted for in a paper tax return – this needs to be posted to HMRC no later than 31 October 2017.We can help you with self-assessment.
Businesses that failed to pay staff the national minimum wage have been forced to pay back more than £2 million in unpaid salary.
In addition to paying workers back money they owed, 233 employers on the government's 'named and shamed' list were fined £1.9 million.
The national living wage is currently £7.50 an hour for employees over the age of 25, and £7.05 an hour for those aged between 21 and 24.
The Department for Business, Energy and Industrial Strategy said retail, hairdressing and hospitality businesses were among the worst offenders.
Common errors made by businesses include:
"It is against the law to pay workers less than legal minimum wage rates, short-changing ordinary working people and undercutting honest employers.
"Today's naming round identifies a record £2 million of back pay for workers and sends the clear message to employers that the government will come down hard on those who break the law."
Melissa Tatton, director at HMRC, added:
"HMRC is committed to getting money back into the pockets of underpaid workers, and continues to crack down on employers who ignore the law.
"Those not paying workers the National Minimum or Living Wage can expect to face the consequences."
Contact us to discuss your payroll issues.
Originally announced in the 2016 Budget, the 2016 Autumn Statement confirmed that Class 2 National Insurance Contributions (NICs) will be abolished from April 2018, hopefully achieving the desired effect of simplifying National Insurance for the self-employed and making the system fairer for employed and self-employed individuals.
At the same time as the abolition of Class 2 NICs, the system for Class 4 NICs will be reformed to include a new threshold – to be called the ‘small profits limit’ (SPL). The amount of the SPL for 2018/19 is yet to be confirmed but is likely to be around £6,025.
Payment of Class 2 NICs by the self-employed – a standard weekly contribution of £2.80 per week in 2016/17, rising to £2.85 per week from April 2017 – gives eligible individuals access to certain contributory benefits such as contribution-based employment and support allowance, basic state pension and bereavement benefits.
Class 4 NICs are paid by the self-employed on profits above the annual ‘lower profits limit’ (LPL). For 2016/17, contributions are payable at the rate of 9% on profits between the LPL of £8,060 and the ‘upper profits limit’ (UPL) of £43,000. Contributions are then paid at the rate of 2% on profits above the UPL. For 2017/18 the LPL will be £8,164 and the UPL will be £45,000.
After abolition of Class 2 NICs from April 2018, those with profits between the SPL and the LPL will not be liable to pay Class 4 contributions but will be treated as if they have paid Class 4 contributions for the purposes of gaining access to certain contributory benefits. Those with profits at or above the Class 4 LPL will gain access to the new state pension, contributory employment and support allowance (ESA) and bereavement benefit. Those with profits above the LPL will continue to pay Class 4 contributions.
The special arrangements that currently apply to share fishermen and volunteer development workers that allow them to pay special rates of Class 2 NICs to gain access to a wider range of benefits than currently available through Class 2, will also be abolished from April 2018. Transitional provisions will apply.
Class 3 contributions, which can be paid voluntarily to protect entitlement to the state pension and bereavement benefit, will be expanded from April 2018 to give access to the standard rate of Maternity Allowance (MA) and contributory ESA for the self-employed. Rates of Class 3 NICs are £14.10 per week for 2016/17 rising to £14.25 in 2017/18.
Concerns over these changes have been expressed within the tax profession. Anthony Thomas, Chairman of the Low Incomes Tax Reform Group (LITRG) said that some parts of these proposals are good news for self-employed workers on low earnings, but by no means all. Those with profits between the Class 2 exemption limit (currently £5,965) and the Class 4 LPL (currently £8,060) will be better off because they will pay no NI but be credited with contributions. The Group’s concern is for those with earnings lower than £5,965 who would have to pay voluntary Class 3 contributions in the future to protect their benefits entitlement if they did not obtain NI credits through receipt of other benefits, for example tax credits, child benefit or Universal Credit. Class 3 contributions will cost almost five times the amount they are paying now (£14.10 per week compared to £2.85 per week) and may mean the cost is unaffordable, leading them to rely more on means-tested benefits in the future.
The Federation of Small Businesses (FSB) is calling for local authorities in England to become more accountable and transparent when it comes to economic growth and business support.
A survey on 1,801 small business owners found the majority (70%) support the idea of giving more powers to local authorities, while 64% believe devolution deals were good for their business.
However, only 15% have been consulted on the devolution process in their area, suggesting most businesses are generally being excluded.
57% felt they couldn’t contribute to ongoing decision making and 53% said there were no means to hold locally-elected bodies to account.
Mike Cherry, national chairman at FSB, said:
“The success of devolution deals will hinge on effective collaboration between new and existing local leaders.
“Combined authorities must clearly demonstrate how they are promoting growth and establish channels through which they can be held accountable.
“With new devolution proposals in the pipeline, future deals must be established on the basis of need.”
A public consultation has been launched by the European Commission (EC) to improve VAT for cross-border e-commerce transactions in the European Union (EU).
The consultation aims to seek advice from business owners and representative parties ahead of legislative proposals aimed at the digital single market next year.
The Commission are aiming to collect feedback on Mini-One Stop Shop (MOSS), which was implemented to help businesses sell digital services in multiple EU states will still declaring and paying VAT in their home country.
The consultation will seek advice from businesses and other representative parties on:
· the current VAT rules for cross-border supplies of goods and services
· implementation of this year’s VAT changes of supply rules and MOSS
· extend MOSS and payment mechanisms to intra-EU and online sales for tangible goods.
Simplification measures for smaller businesses will be introduced, including an appropriate threshold which can address problems without causing effect to the single market or compliance challenges for tax administrations.
Andrus Ansip, European Commission Vice-President for the Digital Single Market, said:
"We promised to support companies, and especially smaller ones, to reduce burdens arising from different VAT regimes. Today we ask businesses and other stakeholders to help find the most effective and meaningful ways of delivering on this promise. In the Digital Single Market Strategy we have already put forward some measures we would like to take, such as a VAT threshold for startups."
Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs said:
"This consultation presents a real opportunity to ensure that future VAT revenues from the digital economy are distributed fairly and effectively. At the same time, we want to make it as easy as possible to comply with the rules. We also have an interest in ensuring that future legislation reflects the reality for businesses across the EU.”
The rates that apply to fuel cost for company cars have changed as of 1 September 2015.
The new advisory fuel rates will only apply when:
The new rates apply from 1 September 2015. The previous rates can be used for 1 month:
Borrowers are worried about the effect a rise in interest rates will have on their regular debt repayments, according to research published by the Building Societies Association (BSA).
The survey of 2,000 adults shows that around a tenth think that a rise in interest rates would mean that they experience financial problems.
The other findings of the survey:
Paul Broadhead, head of mortgage policy at the BSA, said:
"Concern from borrowers is natural when it comes to interest rate rises. There are at least 1.85 million homeowners that have never experienced a rate rise, we have a record low bank base rate for so long, it is unsurprising that some people are concerned that a rise in rates will affect their lifestyles and ability to make mortgage repayments.
"Our advice to those concerned about interest rate rises is to start thinking about how they will manage the increased costs. This could include creating a household budget, to taking a look at mortgage calculators and rescheduling unsecured loans such as credit cards."
Joanna Elson OBE, chief executive of the Money Advice Trust, which runs the National Debtline, said:
"Households now have a window of opportunity to re-assess their budgets, look again at their borrowing and think about how they will cope with higher interest rates. It is crucial they take advantage if this and prepare themselves now."
Talk to us today about your personal finances.
The Autumn Statement has been delayed by one day
and will now take place on Thursday 5 December, the Treasury has confirmed.
The change of date ensures that the Chancellor George Osborne's Autumn Statement
speech to the House of Commons will not take place while Prime Minister David Cameron is out of the country.
The Prime Minister will lead a major trade delegation to China at the start of December,
which he said is aimed at:
"opening the way for British companies to benefit from China's vast and varied markets and preparing
the way for a new level of Chinese investment here in the UK."
An update on HM Treasury's official Twitter account announced:
"Tonight PM says that he will lead delegation to China in early December.
As a result Autumn Statement will now be on Thursday 5th December. "
The first round of funding for the investment arm of the Government's Business Bank,
designed to stimulate the flow of finance to small businesses,has been announced by the Business Secretary Vince Cable.
Outlined in the 2012 Autumn Statement, the Business Bank will consolidate a number of existing finance schemes for SMEs.
It will also fund the provision of advice and support for businesses to start-up and grow.
The Bank's £300 million investment programme will allocate funds to existing lenders and specialist finance companies,
which will then provide debt finance to SMEs.
The first wave of funding for the investment programme amounts to £45 million, of which:
· £30 million will be allocated to Praesidian Capital Europe; and
· £15 million will go to BMS Finance, which has a focus on SMEs
with high growth potential and those nearing profitability.
Both funds are expected to start lending to SMEs in early 2014.
Announcing the funds, the Business Secretary Vince Cable said:
"The first investments from the British Business Bank's investment programme will provide choice to smaller businesses
looking to secure vital finance to help invest."
Mr Cable also announced a new £1 million business-to-business mentoring campaign and a £10 million
start-up fund for entrepreneurs in the synthetic biology market.
The Skills and Enterprise Minister Matthew Hancock said: "Government has an important role
in providing a coherent package of measures to support businesses,
but there is also a role for business-to-business support, with successful, growing small businesses
talking to others about how exporting, hiring and business planning can take a business to the next level."
The cost of goods and services for consumers increased by 2.2 per cent between
October 2012 and October 2013, according to the Office for National Statistics (ONS).
The consumer prices index (CPI) 12-month rate of inflation measures the rise or fall
in the cost of household goods and services over the past year.
CPI fell from 2.7 per cent in September, the first time it has been lower than 2.5 per cent since April.
The Bank of England's stated target for CPI inflation is two per cent.
The main reasons for the fall in the rate were lower prices for fuel in the transport sector
and reduced costs for tuition fees in education.
Commenting on the fall in the rate, David Kern of the British Chambers of Commerce said:
"The larger than expected fall in inflation will ease pressures on businesses and consumers,
particularly at a time when wages aren't rising at the same rate. However while we expect inflation
to fall further over the next year, this will not be a smooth process. Some of the October declines
are likely to be reversed, especially when energy price increases take effect."