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25/08/2020

Syed Shah is inviting you to a scheduled Zoom meeting.

Topic: Business Startup essentials

For small and medium Businesses

Time: Aug 25, 2020 06:00 PM London

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03/04/2018

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03/03/2018

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06/08/2017

New trade body to be created by government
04 Aug 2017

The government has revealed its intention to create a new trade authority, termed the UK Trade Remedies Organisation, ahead of Britain’s departure from the EU in 2019.

The UK Trade Remedies Organisation will help to combat incidents of unfair trade that may occur once Brexit has taken place.

It will also build upon the UK’s ‘capability and capacity’ to investigate complaints in relation to unfair competition, and will allow the UK to establish its own trade rules.

The government is looking to recruit around 130 employees, and intends to have the new organisation up and running by October 2018.

Commenting on the news, Jill Rutter, Programme Director at the Institute for Government (IfG), said: ‘The government needs to prepare for Brexit, and that includes being able to run our own system of trade defence.

‘The government’s current policy is to leave the single market and the customs union and has to be ready for leaving with no deal. So this is a sensible part of that contingency planning.’

06/08/2017

UK 'won't cut taxes post-Brexit', Chancellor states
01 Aug 2017

Chancellor Philip Hammond has suggested that the UK won’t cut taxes and fiscal regulations after Brexit.

The Chancellor stated that the UK will remain within the ‘EU average’ in terms of tax rates, and will not seek to reduce taxes in a bid to become more competitive.

He commented: ‘I often hear it said that the UK is considering participating in unfair competition in regulation and tax.

‘That is neither our plan nor our vision for the future.

‘I would expect us to remain a country with a social, economic and cultural model that is recognisably European.’

In January, Mr Hammond stated that the government may have to ‘change its economic model’ if the UK was unable to remain in the EU single market.

He commented: ‘We will change our model, and we will come back, and we will be competitively engaged.

‘I personally hope we will be able to remain in the mainstream of European economic and social thinking. But if we are forced to be something different, then we will have to become something different.’

The Chancellor’s recent statements come amid ongoing Brexit negotiations, with government officials debating the free movement of EU citizens in the UK.

06/08/2017

Making Tax Digital: are you up to date?
Following the dropping of Making Tax Digital (MTD) plans from the first Finance Bill of 2017, the government recently outlined new proposals for its landmark digital scheme, to be legislated for in the next Finance Bill, due in the Autumn. Here, we examine the changes.

A new MTD timetable

The government recently stated that it has 'listened to concerns' raised by the Treasury Select Committee and business in regard to the pace of change and the 'short timetable' for the successful introduction of MTD, and will be taking steps to 'ensure a smooth transition to a digital tax system'.

Under the government's new timetable for MTD, from April 2019 businesses with a turnover above the VAT threshold (currently £85,000) will have to keep digital records and provide quarterly updates to HMRC for VAT purposes only. As VAT registered businesses must already submit quarterly VAT returns, initially firms will not need to supply HMRC with information any more regularly than they do now.

Businesses will not be required to keep digital records or update HMRC quarterly for other taxes until 'at least 2020'.

The government intends to pilot Making Tax Digital for VAT on a small scale 'by the end of this year'. Wider live piloting will begin from Spring 2018.

The four new Making Tax Digital foundations

The government has outlined the four 'foundations' of MTD, which set out the key aims of the new regime as follows:

1. Better use of information

This foundation outlines the perceived benefits of MTD when it comes to obtaining and making use of information. This includes the fact that HMRC will be able to obtain information from other sources, such as employers, banks and other government departments, rather than requiring the taxpayer to provide it.

Digital tax accounts will also allow taxpayers to view the information HMRC holds on them, and to ensure that their information is accurate and up to date. The government also intends to make use of the information to tailor its services to taxpayers' requirements.

2. Tax in real time

HMRC has stated its intention to collect and process taxpayers' information in 'as close to real time as possible'. It believes that this will help to prevent errors and reduce the number of taxpayers who end the year having paid too much or too little tax.

3. A single financial account

By 2020, the government aims to provide taxpayers with a single overview of their tax liabilities and entitlements - in a similar way to online banking.

4. Interacting digitally with customers

Under the new system, taxpayers and their agents will be able to interact with HMRC digitally. Taxpayers will be able to access government advice and support via webchats and secure messaging, and digital record keeping software will be linked directly to HMRC systems.

The MTD changes will be legislated for in the upcoming Finance Bill, which the government will debate following its Summer recess.

06/04/2017

VAT flat rate scheme changes: are you prepared?
April 2017 sees the introduction of changes to the VAT flat rate scheme, which are likely to have a significant impact on certain small businesses. We consider the changes below.

Understanding the flat rate scheme

The VAT flat rate scheme was designed to reduce the administrative burden on small businesses operating VAT. Under the scheme, instead of having to identify and record the VAT on each and every sale and purchase made, a business can apply a flat rate percentage to its turnover as a one-off calculation.

Businesses can opt into the scheme, but only if they do not exceed the relevant limits. Businesses must leave the scheme once income in the last 12 months exceeds £230,000, unless this is as a result of a one-off transaction and income will fall below £191,500 in the upcoming year. Businesses are required to also leave the scheme if there are grounds to believe that total income is likely to exceed £230,000 in the next 30 days.

What's changing?

In the 2016 Autumn Statement, Chancellor Philip Hammond announced the introduction of a new 16.5% rate for 'limited cost traders'. This type of trader is defined as one that spends less than 2% of its VAT-inclusive turnover on goods in the accounting period. Businesses whose VAT inclusive expenditure on goods is greater than 2% of their VAT inclusive turnover, but less than £1,000 per year (providing the prescribed accounting period is one year) may also be defined as a 'limited cost trader'.

The new rate will be introduced from 1 April 2017 for those firms with limited costs, such as many labour-only businesses, including hairdressers and IT consultants, amongst other professions. Any business wishing to make use of the scheme will be required to determine whether or not it meets the definition of a 'limited cost trader'.

The regulations outline that the goods must be used exclusively for the purpose of the business. Expenditure on the following items is excluded:

capital expenditure
food or drink for consumption by the flat rate business or its employees
vehicles, vehicle parts and fuel (excluding businesses that provide transport services, such as taxi firms, and which use their own or a leased vehicle to carry out such services).
These are excluded as part of the test to prevent traders from attempting to inflate their costs above 2%.

The government hopes that the introduction of the new rate will help to 'level the playing field' and maintain the accounting simplification for the small businesses that make use of the scheme as it is intended to be used.

Anti-forestalling provisions

The government has issued anti-forestalling provisions which are designed to prevent a business defined as a limited cost trader from continuing to use a lower flat rate beyond 1 April 2017. Businesses which provide a service on or after 1 April 2017 but either issue an invoice or receive a payment for that service before 1 April 2017 will be affected by the new provisions.

How will I know if my business is affected?

HMRC is set to introduce a new online tool to help businesses decide whether or not they should use the new 16.5% rate. It has also pledged to begin communicating with those businesses which will be affected, ahead of the 1 April 2017 implementation date.

06/04/2017

Looking ahead: key changes for 2017/18
The start of the new tax year sees the introduction of a raft of changes to tax and business legislation. Here we outline some of the key measures that take effect from April 2017.

Introducing the Apprenticeship Levy

The new Apprenticeship Levy comes into effect on 6 April, as part of a government target to create three million new apprenticeships in England by 2020. The Levy requires larger employers (those with annual pay bills over £3 million) to invest a percentage of their yearly pay bill in apprenticeships.

The government is introducing a new digital account system for such employers, and payments will be taken each month in order to pay training providers.

The Levy is 0.5% of a business's 'pay bill', although an annual allowance of £15,000 is available. Employers are required to report and pay the Levy using the PAYE process. There will only be a need to report on the Levy if the employer:

had a pay bill of £3 million in the previous tax year; or
if the employer considers that the pay bill will be over £3 million during the current tax year.
Many businesses will have no liability to pay the Levy, and therefore no reporting requirements. Non-Levy paying businesses will still be required to contribute towards the cost of training their apprentices. However, some concessions may apply.

Changes to ISAs

From 6 April 2017, the new Lifetime ISA will be available to any adult under the age of 40. Individuals will be able to deposit up to £4,000 per tax year, and receive a 25% bonus from the government on any savings put into the account before their 50th birthday.

The tax-free savings and the government bonus can be put towards a deposit for a first home in the UK worth up to £450,000 at any time, from 12 months after having first saved into the account. Should an individual wish to make contributions towards their retirement, the funds, including the bonus, may be withdrawn from age 60 tax-free.

Lifetime ISA holders can also withdraw money before their 60th birthday for other purposes. However, a 25% government charge will be applied to the amount of the withdrawal, along with a 'small additional charge'.

Meanwhile, from 6 April 2017 the overall annual ISA subscription limit rises from £15,240 to £20,000. Additionally, the annual Junior ISA subscription limit will increase from £4,080 to £4,128.

An individual will only be able to pay into one Lifetime ISA each tax year, as well as a Cash ISA, a Stocks and Shares ISA and an Innovative Finance ISA.

The Pensions Advice Allowance

Following consultation, the government is to introduce a new Pensions Advice Allowance (PAA) from April. First announced in the 2016 Autumn Statement, the PAA will allow individuals to withdraw up to £500 three times a year from their pension pots tax-free, to put towards the cost of receiving regulated retirement advice.

New rules on inheritance tax (IHT)

April 2017 sees the introduction of the new 'residence nil-rate band' (RNRB) for each individual, to enable a 'family home' to be passed wholly or partially tax-free on death to direct descendants such as a child or grandchild.

The amount of relief will be phased in over four years and will initially be £100,000 in 2017/18, rising each year thereafter to reach £175,000 in 2020/21.

The RNRB may only be used in respect of one residential property which does not have to be the main family home but must at some point have been a residence of the deceased. Restrictions apply where estates are in excess of £2 million.

The RNRB is in addition to an individual's own nil-rate band and any unused nil-rate band may be transferred to a surviving spouse or civil partner.

Salary sacrifice

From April 2017 the tax and employer national insurance advantages of many salary sacrifice schemes will be removed.

This will mean that employees swapping salary for benefits will pay the same tax as individuals who buy them out of their post-tax income. However, certain benefits will be exempt from the changes. These include: pension contributions and arrangements (including pensions advice); childcare vouchers; workplace nurseries; Cycle to Work schemes; and ultra-low emission cars with CO2 emissions of up to 75 g/km.

Arrangements made before April 2017 will be protected until April 2018. Arrangements put in place for cars, educational fees and accommodation will be protected until April 2021.

VAT flat rate scheme

A new 16.5% rate will be introduced for businesses with limited costs, such as many labour-only businesses. The new rate comes into effect from 1 April 2017, although anti-forestalling provisions are also in force.

A 'limited cost trader' is defined as one that spends less than 2% of its VAT inclusive turnover on goods in an accounting period. A firm will also be defined as a limited cost trader if its expenditure on goods is greater than 2% of its VAT inclusive turnover but less than £1,000 a year.