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September 2019

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To September’s Tax Tips & MYOB News.

Fed up with HMRC and their poor customer service?
HMRC have now introduced online forms and a telephone helpline specifically for complants. Unfortunately for us these are just for you, the businesses – not for agents! Telephone Complaint lines include the following:
  • Self Assessment: tel: 0300 200 3310
  • VAT: tel: 0300 200 3700
  • Support for Employers: tel: 0300 200 3200
For full details including opening times and the online complaint procedures go to the HMRC website.
September 2019
· Employers must plan ahead for EA restriction
· Tax cuts coming for zero emissions vehicles
· Parking for rent?
· Changes to our Banking Recommendations
· September questions and answers
· September key tax dates
Employers must plan ahead for EA restriction top
The Employment Allowance (EA) is a valuable relief, particularly for small businesses as it potentially cuts the business’s national insurance contributions (NIC) bill by allowing a pre-set annual amount to be offset against PAYE NIC costs. The current limit is £3,000, and it is widely available to most employers. However, from April 2020 the allowance is being restricted to smaller businesses with an NIC bill of less than £100,000 in the previous tax year.
Read More
Tax cuts coming for zero emissions vehicles top
Parking for rent? top
Significant changes to the tax rules governing zero emissions company cars will take effect from 6 April 2020, potentially making an electric car a more attractive option.

The tax rules for calculating the taxable benefit arising on a car are not changing – this will still be calculated (broadly) using the car’s full manufacturer’s published UK list price multiplied by the ‘appropriate percentage’, which can be found by reference to the car’s CO2 emissions level. This calculation gives the taxable value of the car benefit. The employee pays income tax on the final figure at his appropriate tax rate (e.g. 20% for basic rate taxpayers; 40% for higher rate taxpayers). This formula means that in general terms, the lower the C02 emissions of the car, the lower the resulting tax charge will be.
Read More
Finding a parking space in a town centre or near to the station is often frustratingly limited. So, if you have a driveway, field or land that can be utilised for parking, you may well have an excellent opportunity to earn some extra tax-free income.

Two new allowances – each set at £1,000 – were introduced from 6 April 2017, one for trading income and one for property income. The allowances are available in addition to the personal allowance.
Read More
Changes to our Banking Recommendations
We last reviewed bank accounts from a technical angle in our March issue last year.
Things are now changing.  The Payment Services Directive 2 (PSD2) is regulating banks in the European Economic Area (EEA).  It forces them to open their APIs to allow Third Party Providers (TPP) to access customer data and initiate payments.  The UK Open Banking will initially only be available among the nine biggest banks and building societies.  

Many smaller bookkeeping softwares will not be compliant with Open Banking regulations when they come into effect on September 14, 2019.  For example Wave’s bank connection feature will no longer be available to users in the UK & EU after Open Banking regulations come into effect in September.  Many products will no longer support automatic bank imports when Open Banking comes into force, but you can still import transactions using statement uploads (eg ofx text files).  

Open banking only applies to UK and EU bank institutions. For now you can continue to automatically import bank feed transactions from any institution geographically outside of the United Kingdom and European Union.

All this means that it is now your choice of bank that helps to decide your choice of bookkeeping software.  For example if you are banking with Barclays then the software ‘FreeAgent Central’ would continue to accept the new direct Open Banking feeds.  If you bank with Triodos then exported Oxf and Qif files are still available but Open Banking feeds are yet to be developed by your bank.  

Meanwhile if you use Wave accounts software you are limited to importing transactions say each month by ofx statement downloads.  This is even if your bank has provided Open Banking.  Programs like Wave and Yodlee will automatically sever the connection to any impacted financial institutions that you have connected on or before September 14, 2019.  

Therefore we now only recommend Wave when you need an online software and you are banking with a bank that doesn’t provide Open Banking Feeds.  We do not recommend Yodlee any longer.  We recommend FreeAgent Central and Clearbooks only if your bank is a provider of Open Banking feeds.

As for the business bank accounts these appear to be those in the first tranche offering Open Banking connectivity.
  • Barclays
  • BoS
  • First Direct
  • Halifax
  • HSBC
  • Nat West
  • Lloyds
  • RBS
  • Ulster bank
Metro and Santander are notable omissions from this list.

For clients using Quickbooks desktop we continue to recommend this software.  It allows for better control for building and CIS compliance.

For clients where we provide bookkeeping services (normally as a chargeable extra) we normally support Accountedge or Wave depending on the complexity of the business.

For clients using Accountedge or MYOB we are happy to continue to recommend this software.  It allows for more complex stock control, import export and multicurrency transactions than is available for online softwares.  The import of transactions via QIF, OFX or similar is still satisfactory.

We continue to oppose the use of Sage and similar systems where the transactions are not easily amendable.  The change to Open banking does not alter that recommendation.’

Read More: 

Opening a Bank Account

September questions and answers top
September key tax dates top
Q. I am a qualified chiropractor and I have been running my own business for many years. I would now like to specialise in a particular area and have enrolled on a university course to obtain the relevant qualification. The cost is around £18,000 per annum and the course is three years in duration, during which time I intend to continue working part-time. Is the cost of the course deductible for tax purposes? Answer

Q. What is the statutory time limit for keeping VAT records? Answer

Q. I own a buy-to-let property, which has a mortgage of £50,000 owing on it. I bought the property for £100,000 and it is currently worth around £150,000. What will be the capital gains tax implications if I pay off the mortgage and then sell the property? Answer
19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/9/2019
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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