Lots of changes are happening at HMRC, making Tax Digital
for Individuals and Businesses is one of these. The new digital tax accounts
will integrate all the different information businesses already provided to
HMRC into a simple, streamlined system. Businesses will need to file four tax returns a year. Digital tax accounts mean the end of
the annual tax return over the next four years. Most businesses, self employed people and landlords will start to keep track of their tax affairs digitally and update HMRC quaterly from April 2019. We will be give you more information once the the legislation is laid out later this year.
Annual Tax on Enveloped Dwellings or ATEDATED is an annual tax payable mainly by companies that own UK Residential property valued at more than £500,000. A new ATED band came into effect on 1 April 2016 for properties valued between £500,000 and £1 million. The amount you will need to pay is worked out using a banding system based on the value of the property. If you need to pay ATED on your propery, you will need to complete and send HMRC a return. You can appoint us to complete and send an ATED1 form.
Significant Control Register
From 6th April 2016, Limited companies and
Limited Liability partnerships must keep a Person of Significant Control
Register (PSC). This will include
individuals who holds more than 25% of shares in the company, or more than 25%
of voting rights. The information will be filed to Companies House on the new Confirmation
Statement that replaces the Annual Return.
From 1st April 2016, those buying a buy-to-let
property or second home will have to pay a 3 per cent stamp duty surcharge on
the existing bands.
VAT Flat Rate Scheme changes
In the Autumn Statement, Chancellor Philip Hammond announced changes which affect businesses which have a very low cost base. These businesses are now called "limited cost traders". Limited cost traders can still use the Flat Rate Scheme, but their percentage will be 16.5%. So if they sell £120 of work, including £20 of VAT, the flat rate amount is £19.80 (£120 x 16.5%).
A limited cost trader is defined as one that spends less than 2% of its sales on goods (not services) in an accounting period.
When working out the amount spent on goods, it cannot include purchases of:
-capital goods (such as new equipment used in a business)
-food and drink (such as lunches for staff)
-vehicles or parts for vehicles (unless running a vehicle hiring business)
A firm will also be a limited cost trader if it spends less than £1,000 a year, even if this is more than than 2% of the firm's turnover on goods.
If you need more advice and clarification on all these, please contact us, we will be happy to help.