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The Chancellor, Rishi Sunak, has delivered his third major statement to the House of Commons in less than a month. This followed the Winter Economy Plan on 24 September and further announcements on 9 October that expanded the scope of the Job Support Scheme and introduced new grants for businesses forced to close because of local or national lockdown measures. In his third statement delivered on 22 October, the Chancellor has significantly revised previously announced measures to help protect jobs ...
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Under standard VAT accounting, VAT is payable on sales whether or not the customer has paid and can lead to a claim for Bad Debt Relief. Under the Cash Accounting Scheme, VAT does not need to be paid over until the customer has paid. A business can enter this scheme provided their estimated VAT taxable turnover for the next VAT year is not more than £1.35 million. The business can continue to use the scheme until their VAT taxable turnover ...
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In the current tax year, anyone with taxable income of less than £17,500 will have no tax to pay on their savings income - interest received. This figure is calculated by adding the £5,000 starting rate limit for savings (where 0% of the interest is taxable) to the current £12,500 personal allowance. However, this £5,000 starting rate limit for savings will be reduced by £1 for every £1 of non-savings income in excess of £12,500. Accordingly, when non-savings income amounts ...
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The Extra Statutory Concession (ESC) - C16 was a well-used extra-statutory concession that allowed company directors to treat final distributions as a capital disposal and close down their business in an efficient manner. ESC C16 was withdrawn in March 2012 and replaced by s1030A Corporation Tax Act 2010 (CTA 2010) provisions. This move meant that from 1 March 2012, the concessionary treatment provided by ESC C16 were replaced by more restrictive statutory rules which included the introduction of a new ...
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The Annual Investment Allowance (AIA) allows for a 100% tax deduction on qualifying expenditure on plant and machinery to be deducted from your profits before tax. The relief is normally capped at £200,000 per annum but was temporarily increased to £1 million for a 2-year period from 1 January 2019 to 31 December 2020. This means that there is now just over two months left to take advantage of the increased limit. If you are thinking of incurring large items ...
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The Brexit transition period is due to end on 31 December 2020 and this means that the process for exporting goods to the EU will change from 1 January 2021. Current guidance published by HMRC states that from 1 January 2021, businesses will need to make customs declarations when exporting goods to the EU. This is what you currently have to do if exporting goods to any country outside of the EU, including Switzerland, Norway, Iceland and Liechtenstein. Businesses, especially ...
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As we have reported previously, the UK government has confirmed that it will neither accept nor seek any extension to the Brexit transition period which expires on 31 December 2020. The EU has formally accepted this position. This means that the process for importing goods from the EU will change from 1 January 2021. HMRC has published guidance to help those importing goods to prepare. Some important points to bear in mind from 1 January 2021 are as follows:

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There are a number of reasons why you may decide to close your limited company. This could be because a limited company structure no longer suits your needs, your business is no longer active, or the company is insolvent. You will usually need the agreement of all the company’s directors and shareholders to close down the company. The method for closing down a limited company depends on whether it is solvent or insolvent. If the company is solvent, you can ...
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The government has announced plans to allow customers to get cashback from shops without needing to make a purchase. At the moment, cashback is only available to those who buy goods. The new proposals have been put in place to help protect the UK’s cash system following a steady decline in the use of cash. This process has accelerated significantly during the coronavirus pandemic. Under the government proposals, cashback without a purchase could be widely available from retailers of all ...
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Unbelievably, it has been illegal to make phone calls or text while driving a car, but not illegal to play games or take photos. Clearly, this loophole is begging to be closed and new legislation proposed, 17 October 2020, will aim to do just that. A Government announcement says: People using a hand-held mobile phone in all circumstances while driving will be breaking the law, under new Government plans unveiled by Roads Minister Baroness Vere today (17 October 2020) to ...
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From 1 January 2021, UK businesses that export, import or transport goods to and from the EU will need to comply with a number of new regulations. Inevitably, some will fall short and these will create delays, in your goods reaching EU customers, the goods of EU suppliers reaching you, and transport drivers spending more time than is necessary in queues of traffic as the paperwork threads are resolved. Leaving aside the obvious need to become acquainted with, and comply ...
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One of the measures announced by HMRC at the start of the coronavirus pandemic was the introduction of emergency measures to help tax payers affected by COVID-19 to use the Time To Pay service. Businesses and self-employed people in financial distress and with outstanding tax liabilities may be eligible to receive support with their tax affairs by accessing this service. An online payment plan was available to set up instalment arrangements for paying tax liabilities up to £10,000. This limit ...
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There are special rules in place for taxpayers who gift land, property or certain shares to charity. This can include Income Tax and Capital Gains Tax (CGT) relief provided all the necessary conditions are met. There is no Income Tax relief on donations to community amateur sports clubs (CASCs). Income Tax relief Where qualifying assets are gifted, the market value of the asset is deducted from the taxpayer’s total income rather than adjusting their basic rate tax band. This should ...
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Company filing deadlines were extended for companies with filing deadlines between 27 June 2020 and 5 April 2021. Companies House is warning of delays in postal submissions and have said it is taking much longer than usual to process paper documents, forms and letters sent by post. Accounts filed on paper need to be manually checked and Companies House currently have reduced staff numbers in their offices to maintain social distancing. Companies House is therefore encouraging companies and their advisers ...
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New VAT rules for building contractors and sub-contractors come into effect from 1 March 2021. The new rules will make the supply of construction services between construction or building businesses subject to the domestic reverse charge. The reverse charge will only apply to supplies of specified construction services to other businesses in the construction sector. Guidance on the workings of the domestic reverse charge (referred to as the reverse charge) has been published by HMRC. The reverse charge will affect ...
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On 12 October, the Prime Minister announced the introduction of a new three-tier system of local COVID-19 alert levels across England. The new system sets the levels at medium, high and very high based on local transmission rates. The legislation to write the new three-tier system into law was approved by Parliament on 13 October 2020. The medium level which covers most of the country consists of the current national measures, which came into force on 25 September. This includes ...
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Home owners and landlords in England can apply for a grant to make their home more energy efficient. The Green Homes Grant will cover at least two-thirds of the cost up to £5,000 per household. For low income households these grants will cover all costs up to £10,000. The scheme runs until 31 March 2021. The Green Homes Grants provides homeowners, including owner occupiers and social/private landlords, vouchers to install one or more of the following primary measures:

• solid ...
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HMRC is warning new students starting university that they could be targeted by scammers trying to steal their money and personal details. As new students start the academic year they can be particularly vulnerable to tax scams. Coupled with an increase in remote working due to the pandemic can leave students particularly exposed to the work of fraudsters. Many tax scams are directly targeting university students. Fraudulent emails and texts will regularly include links which take students to websites where ...
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The government is moving ahead with plans to build free trade zones - known as Freeports - across Britain after Brexit. Freeports are a special kind of port where normal tax and customs rules do not apply. In their place, simplified customs procedures and duty suspensions on goods applies. The initiative would allow firms to import components and other pre-manufactured goods into a Freeport without paying taxes. The goods would then be processed into a finished product to be built ...
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The new 3-tier system for classifying local COVID alert status sets out what you should not do depending on the classification of your local area. At present they only apply to England. In summary they are: Local COVID Alert Level – Very High This is for areas with a very high level of infections. The Government will set a baseline of measures for any area in this local alert level. Consultation with local authorities will determine additional measures. The baseline ...
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