The Financial Secretary to the Treasury, Mel Stride, has made a statement to the House of Commons setting out HMRC’s progress on delivery of Making Tax Digital (MTD). He confirmed there would be no further delays in implementation.

For most businesses, compliance with the regulations is mandated for VAT return periods beginning on or after 1 April 2019. However, MTD for VAT for some ‘more complex’ businesses has been deferred until 1 October 2019. This deferral applies to trusts; not for profit organisations not set up as companies; VAT divisions; VAT groups; public sector entities such as government departments and NHS Trusts, which have to provide additional information on their VAT return; local authorities; public corporations; traders based overseas; those required to make payments on account; annual accounting scheme users.

Contact us for help and advice on MTD for VAT.

Internet links: Hansard debate MTD

The Scottish Parliament has confirmed the income tax bands that will apply to Scottish taxpayers for 2019/20. The bands confirm the announcement made in the Draft Scottish Budget last December.

The 2019/20 income tax rates and bands for Scottish taxpayers on income (other than savings and dividend income) are as follows:

Scottish taxpayers are entitled to the same personal allowance as individuals in the rest of the UK which for 2019/20 is £12,500. The allowance is reduced by £1 for every £2 of adjusted net income in excess of £100,000.

The UK higher rate tax point for 2019/20 is set at £37,500 and the tax rates for non-savings and non-dividend income are 20%, 40% and 45% respectively. The additional rate of 45% is payable on income over £150,000.

Internet links: GOV.SCOT income tax

Minimum pension contributions are set to increase from 6 April 2019:

The Pensions Regulator has produced guidance for employers on dealing with the increase including a letter template to advise employees of the change.  

Contact us if you would like help with auto enrolment.

Internet link: TPR increases

With the end of the tax year looming there is still time to save tax for 2018/19.

• Make full use of your ISA allowance – ISAs can offer a useful tax free way to save, whether this is for your children’s future, a first home or another purpose. Individuals may invest up to a limit of £20,000 for the 2018/19 tax year. Savers have until 5 April 2019 to make their 2018/19 ISA investment.

• Pensions provide significant planning opportunities. The annual allowance (AA) which is the maximum you can contribute to a pension and still get tax relief, is generally £40,000. Exceeding this can result in an AA clawback charge. However, in many circumstances you may have unused AA from the three previous tax years which can be used in 2018/19, providing the means of making a significant contribution without incurring a charge. Please contact us for advice specific to your circumstances.

These are only a couple of options that you may wish to consider as part of your tax planning strategy. Contact us for more information.

Internet links: GOV.UK ISAs Pensions Advisory Service AA

HMRC has issued Employer Bulletin (February 2019) which includes a number of interesting articles on:

• End of year reporting
• Reporting expenses and benefits
• Student Loan notices and a new type of Student Loan repayment that employers will need to be able to process via payroll (Post Graduate Loans)
• Updates to the Starter checklist – used for new employees
• Reporting the Disguised Remuneration Loan Charge
• Updates to P9 Notices of Coding
• Payrolling benefits in kind
• Scottish Income Tax and
• the Welsh Rate of Income Tax and new codes for Welsh taxpayers.

For help and advice with payroll matters please contact us.

Internet link: Employer Bulletin