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March 2021

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To March’s Business Companion News – our specialist newsletter for our clients and businesses using AccountEdge & other recommended software who also want to keep up-to-date with key legislation and tax changes. 

Have you missed out on an earlier Email Newsletter over the past year?  If so, you can access previous issues in our Newsletter Archive.
March 2021
· Latest news round up
· Import One-Stop Shop
· New Computer? Transferring your AccountEdge Licence
· Self-Employed – what National Insurance do I pay?
· March questions and answers
· March key tax dates
Latest news round up top

There have been relatively few announcements related to Covid-19 support this month. The only real announcement of note was an amendment to the terms of the Pay As You Grow scheme for repaying Bounce Back loans. Under the revised rules, a borrower will be able to take a six-month repayment holiday without needing to have made any previous instalments. Before the amendment, they would have needed to have made at least six payments before this was an option. Full details are available here.
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Import One-Stop Shop top
New Computer? Transferring your AccountEdge Licence
One of the consequences of Brexit is that exports of goods from GB to customers based in the EU are now zero-rated as far as UK VAT is concerned. However, if the consignment is valued at more than £22 there will be an import VAT liability at the other end. This isn’t too much of a problem for B2B sales where the customer is VAT registered – they can simply claim back the VAT according to the particular process relevant to that country. However, for unregistered businesses and B2C customers, there are issues.

Read More
When you purchase Mamut or Acclivity AccountEdge you need to buy a separate licence for each computer (PC or Mac) that you will use the software on.  You will see at the bottom of the registration screen a machine-id which identifies that particular computer.

Therefore if you change/upgrade your computer at a later date it is important that you first deregister the AccountEdge software on the older computer before you try and register on the new computer.  Otherwise you will be using up an extra license, or you will find that you can’t register the software on the new computer at all.

You can download Acclivity AccountEdge here.

Self-Employed – what National Insurance do I pay?
When you’re self-employed, you’re responsible for paying tax and National Insurance on your income.  We will calculate the amounts due for you when we prepare your personal tax returns but it is a good idea to be aware and budget for what will be due.

You may need to pay two different types of National Insurance: Class 2 and Class 4.  National Insurance Contributions (NICs) are contributions are used to pay for certain benefits including the State Pension and Universal Credit.

Class 2 National Insurance
Self-employed people earning more than £6,475 a year will usually pay Class 2 National insurance. This is calculated as £3.05 a week, or £158.60 a year for the 2020/21 tax year.
Class 2 National insurance is voluntary for some occupations and also once you reach State pension age.  See the HMRC guidance. If you are below the £6,475 threshold you can choose to pay voluntary contributions.

Class 4 National Insurance  Self-employed people earning profits of £9,501 or more a year will also pay Class 4 NICs. If you’re over this threshold, you will pay 9% on profits between £9,500 and £50,000 (in 2020/21) and 2% on anything above this.

Checking your NI record You can check to see if you have made enough NICs to cover the full state pension: If your contributions are likely to be short you might want to consider making Class 3 voluntary contributions, or Class 2 voluntary contributions if you are not already paying them.
March questions and answers top
March key tax dates top
Q. I am looking at buying a rundown pub/restaurant ready for this summer, assuming it will be allowed to open. I need to spend approximately £100,000 on building works. Can I register for VAT straightaway or do I need to wait until I open? Answer

Q. Two years ago, I sold my business to a company for £200,000 cash up front. There was also an earn-out deal that would see me receive a percentage of sales above a certain hurdle. This was valued (and taxed) at £100,000 at the time. Due to the coronavirus, I have actually only received £30,000. Can I offset the £70,000 shortfall against my income? I have no other capital gains and am very unlikely to have any going forward. Answer

Q. I have been subject to a drawn-out enquiry by a HMRC officer for nearly two years. I have acted in good faith and provided everything that I have been asked to send in, but the officer keeps asking for more and more paperwork. I”m confident that no errors have been made and have written to her to ask for a closure notice, but this has been refused. Is there a way I can force the issue? Answer
1 – Due date for payment of Corporation Tax for accounting periods ending 30 May 2020.

1 – New rules on domestic reverse charge for the construction industry take effect.

7 – Electronic VAT return and payment due for quarter ended 31 January 2020.

15 – Claim deadline for employers for furlough days in February.

19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/3/2021.

31 – Last date for expenditure on Energy Saving Plant & Machinery to qualify for enhanced capital allowances at 100%.

31 – Due date for any payments delayed under the VAT Deferral Scheme in 2020, unless the new payment scheme is opted into – see here.

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, Xero, Freeagent, 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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