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June 2017

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To June’s Tax Tips & MYOB News, our e-newsletter with topical tips.  This month we include an article relating to this week’s General Election.

Tax Calculators
Have a look on our website for our range of Tax Calculators
These include car and fuel benefits, self-employment v. incorporation, payroll and inheritance tax calculators.
June 2017
·The Election and Making Tax Digital
· SA302s for Mortgage Applications
· CGT annual exemption: use it or lose it!
· Brexit legislation update
· June questions and answers
· June key tax dates
The Election and Making Tax Digital
SA302s for Mortgage Applications top
There are many commentaries on the forthcoming general election that you, as a business person and as a citizen, will have read before Thursday.  
You do not need an endorsement to vote any particular way. 
However, there is one issue that you are likely to have missed.  This is the HMRC ‘Making Tax Digital’ (MTD) program.  It will involve all businesses, including tiny single property lettings, in a quarterly reporting regime to the Government, backed by penalties.This is something that we have expressed concern about in earlier newsletters.

Thank goodness someone is finally listening to accountants’ concerns about MTD. On page 18 of the Labour manifesto the party commits to, ‘Scrap Quarterly reporting for businesses with a turnover of under £85,000.’   The SNP says it will phase in Making Tax Digital quarterly reporting over a five year period.  There is nothing in any of the other manifestos about MTD, including the Conservative one!  There was opposition given by both Green and Democratic Unionist Party MPs at the Treasury Parliamentary Committee inquiry on Making Tax Digital. 

So – consider your reporting burden.  This should be one of the issues that help decide your vote on Thursday.  Phone us on 01422 847500 if you would like to find out directly how MTD might affect your business.
In the past HMRC have been happy to provide ‘SA302’ tax calculations for our clients for mortgage purposes.  However when I rang them about this recently they said that they now expect the client to ‘self serve’ using their personal tax account and print something off themselves.

In fact this is not quite right, since we (as most other accountants) use commercial software to file personal tax returns, rather than the HMRC’s own basic system.  And because of this, SA302s are not available from your personal tax accounts.

Instead, if asked for an SA302, you should provide:
a) a printout of the tax computation which we email you when we submit your personal tax return.
b) A copy of your “Tax Overview” for each year which simply shows how much tax is due to be paid. You can print this off from your HMRC personal tax account: it includes the HMRC logo & your client UTR,

Let us know, if you need help gathering this information, or if your m
ortgage advisors insist they need an SA302.  If so, apparently we can report them to HMRC.

CGT annual exemption: use it or lose it! top
Capital gains tax (CGT) is normally paid when an item is either sold or given away. It is usually paid on profits made by selling various types of assets including properties (but generally not a main residence), stocks and shares, paintings, and other works of art, but it may also be payable in certain circumstances when a gift is made.

The most common method for minimising a liability to capital gains tax is to ensure that the annual exemption is fully utilised wherever possible. Whilst this is relatively straight-forward where only capital gains are in question, the computation can be slightly more complex where capital losses are also involved. Read More
Brexit legislation update top
June questions and answers top
The House of Commons Library has published two research briefing papers entitled Brexit timeline: events leading to the UK’s exit from the European Union and Legislating for Brexit: the Great Repeal Bill.

The Brexit timeline paper provides a timeline of the major events leading up to the referendum and subsequent dates of note, looking ahead to expected events as the UK and EU negotiate Britain’s exit. The Queen’s speech at the State Opening of Parliament, scheduled for 19 June 2017, will include the Great Repeal Bill in the Government’s legislative programme, along with a number of other Brexit-related bills. It is anticipated that the bill will subsequently be passed in late 2017, or early 2018. Broadly, the Great Repeal Bill will repeal the European Communities Act 1972 and, wherever practical and appropriate, convert EU law into UK law from the date Britain leaves. Publication of the bill is expected soon after the Queen’s speech.
Read More
Q. Before I became registered for VAT, I bought a capital item from a friend, which cost £1,000. As it was a private purchase, I did not pay any VAT. I have now joined the flat rate scheme (FRS) for VAT and have just sold the same item for £500. Should I have charged VAT on the sale and included the gross total in my calculation for flat-rate VAT? Answer

Q. I was made redundant from my job on 1 March 2016 and I received a termination package of £25,000. I was then re-employed by the same company on 1 November 2016, but was made redundant from that job too on 1 March 2017. I was paid a further redundancy payment of £10,000 when I left in March 2017. Does the £30,000 redundancy exemption apply to each payment I received? Answer

Q. I reached state retirement age in March 2016 but deferred receiving my state pension for 12 months. I have been informed that I can now take a lump sum in addition to my regular state pension. Is the lump sum taxable? Answer
June key tax dates top
19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/6/2017.
Need Help? top
New Clients Welcome top
Please contact us if we can help you with these or any other tax or accounts matters.

In addition, if there’s anyone else who you think would benefit from the newsletter, please forward the email to them or ask them to contact us to be added to the newsletter list.
If you are not already a client and are interested in becoming one, we would love to discuss how we can help and provide you with a competitive quote for our services.

See details of our Business Companion Service.
About Us top
Simple Accounting Limited offers a cost effective Business Companion service to business owners who use MYOB, Acclivity, Mamut, Solar Accounts, Quickbooks or Clearbooks.

‘All clients using these software packages can benefit from our support. Visit our website for a look at the resource on offer.’

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