Financial Advice

TAX & ACCOUNTANCY TIPS

Dean Flood, Chartered Certified Accountant and Partner at Rowland Hall

www.rowlandhall.co.uk Tel: 01375 373 828 / 01268 696 878

By the time you read this column you we will have entered a new tax year, which commenced on the 6th April. Since the last newsletter, the main activity on the tax front is the Chancellor’s Spring Statement on the 13th March. There were no ‘earth shattering’ announcements but there are a couple of general points of note, some of which are simply relevant given our transition into the new tax year.

Income Tax Rates and Bands

As from the 6th April 2018, the basic personal allowance increases to £11,850. This is the basic amount an individual can earn before paying income tax. 20% income tax will be assessed on the next £34,500 whilst 40% will apply for total earnings above £46,350. Income over £150,000 will be taxed at 45%.

It should be emphasized that the bandings have some additional complications subject to other relevant criteria. These include a graduated tax charge on recipients of the ‘family allowance’ where there is a taxpayer in the house earning in excess of £50,000, and restrictions on the size of the personal allowance for those earning over £100,000. It is strongly recommended that you speak to your tax advisor if you are unsure as to how these matters may affect you.

Please also note that there are additional charges to national insurance to consider.

Making Tax Digital (MTD)

HMR&C would appear to be committed in its drive to ensure that all VAT registered businesses are ready for MTD by April 2019. By that date, all VAT registered businesses must maintain their financial data in a digital form and also transmit VAT return information to HMR&C using MTD functional, compatible software. Handwritten schedules to support online VAT returns will no longer be acceptable. If you have any concerns as to meeting these requirements or perhaps advancing on from handwritten ledgers, you must discuss this with your advisor as soon as possible. Deregistration from VAT may be an option to consider if your turnover is below the deregistration threshold.

General Data Protection Regulation (GDPR)

On 25th May 2018 the General Data Protection Regulation (GDPR) replaces the Data Protection Act 1998. This legislation increases controls on how organisations use data held on individuals. For many businesses that will include data held regarding employees, customers and suppliers. Controls over access to data and in particular when information leaves the security of the businesses internal protection, have to be sufficiently robust. GDPR has undoubtedly ‘raised the bar’ significantly with regard to data protection and the potential penalties for data protection breaches are substantial. If you have any uncertainties on your compliance, appropriate advice must be sought.