The Government has stated that it will ensure that tax reliefs continue to work as they were intended as the new Scottish Income Tax rates and bands are introduced from 6 April 2018. The Government has confirmed:

• Marriage Allowance
  Marriage Allowance allows taxpayers to transfer 10% of their tax-free Personal Allowance to their spouse or civil partner, reducing their tax bill by up to £230 in 2017 to 2018, and £238 in 2018/19. The UK government will ensure that all those claiming Marriage Allowance in Scotland can continue to do so at the current rate (20%).

• Gift Aid
  Gift Aid allows charities to claim back 25p for every £1 donated. The UK government will make changes to ensure that Scottish taxpayers can benefit from the right rate of tax relief on Gift Aid. Gift Aid will continue to be paid to charities at the basic rate, with Scottish taxpayers able to claim the correct amount of additional relief on top of this.

• Pensions relief at source
  The UK government confirmed that current processes will continue while it works with stakeholders to establish how this will work in the longer term. For 2018/19, Scottish taxpayers who receive relief on their contributions at source will, therefore, continue to receive relief in their pension pot at 20%, with no adjustment for those taxed at a rate of less than 20%, and scope for those taxed at a rate higher than 20% to claim additional relief.

• Social security pension lump sum
  The UK government will make changes so that Scottish taxpayers who receive a social security pension lump sum will be taxed, where appropriate, at the new Scottish starter rate.

• Finance cost relief 
  This will continue to apply at 20%, the same rate applicable to landlords across the UK.

Please contact us if you have queries on the workings of any of these tax reliefs for Scottish taxpayers and those resident elsewhere across the United Kingdom.

Internet link  GOV.UK changes to tax relief Scotland

The Enterprise Management Incentive (EMI) allows selected employees (often key to the employer) to be given the opportunity to acquire a significant number of shares in their employer through the issue of options. An EMI can offer significant tax advantages as the share option scheme allows options to be granted to employees which may allow the shares to be received without any tax bill arising until the shares are sold.

HMRC have warned that EMI share options granted in the period from 7 April 2018 until EU State Aid approval is received may not be eligible for the tax advantages presently afforded to option holders, and accordingly share options granted in that period as EMI share options may necessarily fall to be treated as non-tax advantaged employment-related securities options meaning that the options may be taxable when exercised.

To read more, please visit the link below or contact us for specific advice.

Internet link: GOV.UK EMI Bulletin

HMRC are consulting on the tax exemption which will apply from 6 April 2018 on workplace electric charging facilities used by employees.

It was announced in the Autumn Budget 2017 that the government intends to implement an exemption for the benefit of electricity provided by an employer, at the workplace, to charge electric or plug-in hybrid vehicles. The necessary legislation will be included in the Finance Bill later this year and its effect will be made retrospective to 6 April 2018.

This means that there is no need for employers to report the value of electricity provided for the workplace charging of employees’ vehicles from that date.

This consultation seeks comments on workplace charging tax exemptions for electric and plug-in hybrid vehicles.

This guidance will be of interest to employers that pay taxable benefits to employees and provide electric charging points for employee use and the provision of workplace charging facilities, which vehicles the exemption covers and the qualifying conditions of the exemption.

Internet link: GOV.UK consultations/draft guidance

Over the coming years, the government plans to phase in its landmark Making Tax Digital (MTD) initiative, which will see taxpayers move to a fully digital tax system. However HMRC has shared a statement about how they are prioritising change in the department and as a result some parts of MTD will be delayed. HMRC has acknowledged the challenges in:

• exiting the EU and
• the ambition to become the world’s most digitally advanced tax authority.

While some of the finer details are still being decided, HMRC have announced that, to achieve the above, some aspects of MTD are to be delayed.  HMRC still plan to go ahead with MTD for VAT from April 2019. Information on some of the delayed projects is set out below:

Plans to introduce further digital services for individuals

There will be ‘halted progress’ on simple assessment and real-time tax code changes. Additional services in this area will only be added where they reduce phone or post contact or otherwise deliver ‘significant savings’.

Other digitalisation of services affecting fewer individuals

This includes Inheritance Tax payments, Tax Advantaged Venture Capital Schemes applications and PAYE Settlement Agreements

Creation of the single digital account for all businesses

HMRC has confirmed this will now happen at a ‘slower pace’. HMRC has confirmed the single digital account remains an aim of the department and they stress it will not impact the delivery of Making Tax Digital.

Voluntary Making Tax Digital for Business service for income tax 

HMRC has confirmed this will continue to be available for any sole trader wishing to make quarterly updates to HMRC.

Mandatory Making Tax Digital for VAT – still ‘on track’

HMRC stated that MTD for VAT is still on track. VAT registered businesses with a turnover in excess of the £85,000 VAT registration threshold,  will be required to comply with the requirements of MTD for VAT for all VAT periods commencing on or after 1 April 2019. 

In addition, the government has confirmed that, it will not mandate any further MTD for Business changes before 2020, at the earliest.

Internet link: ICAEW blog

We are delighted to announce that Karen Richardson our director has been  awarded a highly commended award in the inaugural English Women’s Awards 2018 for Services to Accountancy.

Local businesswoman shortlisted in first of its kind awards

Managing Director of Standish based McGinty Demack, Karen Richardson, was  shortlisted for the inaugural English Women’s Awards 2018 – North.

Shortlisted in the category of Services to Accounting and Finance, Karen was nominated by people from around the North-West based on her forward-thinking approach.

Held on 19 March at the Mercure Manchester Piccadilly Hotel, the English Women’s Awards – North acknowledged and celebrated the achievements of women including female entrepreneurs, civil servants, charity founders amongst other professionals in the North of England, whose hard work, talent and commitment is often under-represented.

The awards also provided an opportunity and platform for women to inspire others, particularly younger women, as each nominee had their own story to tell and advice to give.

Karen said: “I’m delighted to have won a Highly Commended Award for the Services to Accounting and Finance , it means so much that people across the North-West appreciate the work we do at McGinty Demack. I hope the awards inspire women across the country to get involved in business, it’s tough but also tremendously rewarding.”