The increases have been put in place to fund the NHS, including the impact of the pandemic and to help fund the gap in social care costs.   Dividends – what is changing?   Just like in previous years, there are not any plans to change the ‘dividend allowance’ on the first £2,000 of dividend income that you receive which remains the same as when it was set in 2018. This means that the dividends which fall within this allowance are not charged any tax.   The 2022 increase in dividend tax rates is the first increase since April 2016, making this the first increase in 6 years   ..read more

There are various classes of National Insurance, for which the main ones are explained below; Class 1 If you are an employee: National Insurance is deducted at a rate of 12% on all earnings Between £184 and £967 per week This equates to between £797 and £4189 per month, or Between £9,568 and £50,270 a year. If you are an employee that earns more than £50,270 per year, then earnings above this       amount will be subject to deductions of 2%. If you are an employer: You will need to pay 13.8% on earnings over £170 per week Employers do not have to pay the first £40 ..read more

So, how are salary and dividends taxed? For the 2021/2022 tax year the personal allowance is £12,570 – this means your first £12,570 of income is tax free. If your only income was your salary then any additional salary above £12,570 would be taxed at 20%, and then once you hit the higher tax band of £50,270 any additional salary would be taxed at 40%. There are further thresholds and tax issues to be aware of, but we’ll keep it simple for this article. With regards to dividend income, the tax-free dividend allowance for 2021/2022 is £2,000. For the 2021/22 tax year, the tax on dividends o ..read more

COVID-19 support Extending the Coronavirus Job Retention Scheme (CJRS) until the end of September‌‌‌ ‌2021 : The scheme will  continue to pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month, up to the end of June‌‌‌ ‌2021 .  For periods  in July, CJRS grants will cover 70% of employees’ usual wages  for the hours not worked, up to a cap of £2,187.50.  In August and September, this will then reduce to 60% of employees’ usual wages  up to a cap of £1,875. Employers will need to pay the associated Employer National Insurance co ..read more

Who’s affected and who isn’t? If you are VAT registered and working under the CIS scheme then you need to check whether you are affected or not. If you are not both, then you will not be affected. If you are the main contractor then the usual VAT rules should apply, if you are a sub-contractor and registered for both CIS and VAT then you will be subject to this rule. You could also be a sub-contractor on some jobs and the main contractor on others, this will mean that you will be subject to different VAT rules depending on who you are working for. If you’re not sure whether what you do qualifi ..read more

Is your business braced for Brexit? If not, this is your last chance to get prepared. With about a month to go before the full impact of the UK’s departure from the EU kicks in, businesses all over the country have been nervously waiting for the other Brexit Boot to drop. From the 1 st of January 2021, the formal transition period is over and there’ll be new rules to follow for trading with the EU. Here’s how to prepare: Understand what’s changing It sounds obvious, but if you’re going to play the game you’ve got to know the rules. Whether you’re bringing goods in from or shipping them out of ..read more

Out with the old... The Coronavirus Job Retention Scheme is tapering off, and ends completely after the 31 st of October. Until then, HMRC is coughing up 60% of your furloughed workers’ standard monthly pay, with a cap of £1,875 this month. This is a drop from the original figure of 80%, of course, so you’ll be expected to make up the difference as the government contributions tail off. You’ll also be footing the bill for National Insurance and pension contributions. A couple of extra points: You do need to ensure you’re making up the difference correctly. Employees must be making at leas ..read more

The furlough scheme continues but a number of changes have been put in place,  the main changes highlighted below; CJRS has been extended to 31‌‌‌‌‌‌ ‌‌March 2021 for all parts of the UK . From 1 November2020, the UK Government will pay 80% of employees’ usual wages for the hours not worked, up to a cap of £2,500 per month. The UK Government will review the policy in January. Employers and their employees do not need to have used the scheme before to claim for periods from 1 November 2020 You can claim for employees who were employed on 30 October 2020, as long as you have made a&nbs ..read more

People and businesses across the UK are being provided with additional financial support as part of the government’s plan for the next phase of its response to the coronavirus outbreak, the Prime Minister announced today (31 October). Throughout the crisis the government’s priority has been to protect lives and livelihoods. Today the Prime Minister said the government’s Coronavirus Job Retention Scheme (CJRS) - also known as the Furlough scheme - will remain open until December, with employees receiving 80% of their current salary for hours not worked, up to a maximum of £2,500. Under the exte ..read more

It takes powerful backup to survive out on the Business Battlefield. With the COVID-19 pandemic still tearing through the UK economy, small firms across the country are looking to the government for support. Here are the latest updates on the schemes you can call on during the pandemic. Out with the old... The Coronavirus Job Retention Scheme is tapering off, and ends completely after the 31 st of October. Until then, HMRC is coughing up 60% of your furloughed workers’ standard monthly pay, with a cap of £1,875 this month. This is a drop from the original figure of 80%, of course, so you ..read more