Handbridge Accountancy Solutions

Making Tax Digital

jsheeky — Wed, 25 Feb 2026 08:31:53 +0000

From the 6th April 2026 sole traders and individuals with property income will have to follow the requirements for Making Tax Digital if they have an income ( sales ) of more than £50,000 a year. The requirements are that business records have to be kept digitally using MTD compatible software and that each quarter summary data of income and expenses is sent to HMRC via the software. From 6th April 2027 these requirements will be extended to traders and landlords with an annual income of more than £30,000.

If you require further information please get in touch

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Change to Dividend Tax Rates

jsheeky — Tue, 10 Feb 2026 18:13:50 +0000

With effect from the 6th April 2026 the income tax rates applicable to dividends increase by 2% ( with the exception of the higher rate applicable to additional rate tax payers which remains at 39.35%). So basic rate tax payers will see an increase from 8.75% to 10.75% and higher rate taxpayers from 33.75% to 35.75%. This will impact director/shareholders who take most of their remuneration from their companies in the form of dividends. It’s advised to review their remuneration strategy to see whether it will be tax efficient to take more as salary ( as opposed to dividends). Individual circumstances will differ.

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Employer NIC’s

jsheeky — Wed, 19 Feb 2025 10:09:17 +0000

From the 6th April 2025 the rate at which an employer must pay secondary national insurance on an employees earnings rises by 1.2% to 15%. The threshold at which secondary national insurance becomes payable also falls to £5,000 from £9,100. This change represents a big increase in employee cost for businesses and because of the reduction in the threshold means a disproportionate cost increase for employers employing staff at lower salaries. The national minimum wage also increases in April which in turn will increase the secondary NI payable. For employers only employing a small number of staff the increase will be offset by the rise in the Employment Allowance from £5,000 to £10,500. A business employing 4 people at the national minimum wage will therefore not be liable to pay employer NIC’s.

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National Insurance Contributions

jsheeky — Wed, 13 Nov 2024 10:35:02 +0000

To qualify for a full state pension you need to have 35 years of National Insurance contributions. You can check your National Insurance record https://www.gov.uk/check-national-insurance-record . If there is likely to be a shortfall you can buy additional years by making Class 3 or in the case of the self employed Class 2 contributions. You can make additional contributions for the previous 6 years, although until April 2025 you can make backdated contributions to the 2006 -07 tax year.

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Budget 2024

Admin — Wed, 30 Oct 2024 17:18:24 +0000

The main tax change in today’s budget is the plan to increase Employers NI by 1.2% to 15% from April 2025. Offsetting this for small employers will be an increase in the Employment Allowance from £5,000 to £10,500 pa., this will mean the smallest employers will continue to pay little or no Employer NI. However the Employment Allowance is not available to companies with just a single director employee who will typically see an increase in Employers NI payable from £203 to £835.

In other changes the rates of Capital Gains Tax are being increased with the basic rate increasing from 10% to 18% and the higher rate from 18% to 24%.

The Inheritance Tax allowance will remain frozen at £325,000 for a further 2 years to 2030. Also unspent pension ‘pots’ will be brought into IHT with effect from 2027.

If you have any questions about how the Budget will affect you please get in touch.

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HMRC App

Admin — Mon, 07 Oct 2024 08:38:12 +0000

The HMRC app provides a convenient way to view your National Insurance record, so you can see if you have any contribution gaps. It also allows you to view your self assessment account and make any payments , view your tax codes and details of tax credits and child benefit.

To access the App you will need a Government Gateway Account, if you do not have one you can create one by following this link https://www.access.service.gov.uk/registration/email

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Claiming the Marriage Allowance

Admin — Fri, 28 Jun 2024 15:27:45 +0000

Are you claiming the marriage allowance
27/06/2024

The marriage allowance can be claimed by married couples and those in a civil partnership and where a spouse or civil partner does not pay tax or does not pay tax above the basic rate threshold for Income Tax (i.e., one of the couples must currently earn less than the £12,570 personal allowance for 2024-25).

The allowance works by permitting the lower earning partner to transfer up to £1,260 of their personal tax-free allowance to their spouse or civil partner. The marriage allowance can only be used when the recipient of the transfer (the higher earning partner) does not pay more than the basic 20% rate of income tax. This would usually mean that their income is between £12,571 and £50,270 during 2024-25. For those living in Scotland this would usually mean income between £12,571 and £43,662.

Using the allowance the lower earning partner can transfer up to £1,260 of their unused personal tax-free allowance to a spouse or civil partner. This could result in a saving of up to £252 for the recipient (20% of £1,260), or £21 a month for the current tax year.

If you meet the eligibility requirements and have not yet claimed the allowance you can backdate your claim as far back as 6 April 2020. This could result in a total tax break of up to £1,260 if you can claim for 2020-21, 2021-22, 2022-23, 2023-24 as well as the current 2024-25 tax year.

HMRC’s online Marriage Allowance calculator can be used by couples to find out if they are eligible for the relief. An application can then be made online at GOV.UK.

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Selling a UK Property

Admin — Fri, 14 Jun 2024 08:48:30 +0000

An individual who sells a UK residential property which is not their main home must report the capital gain , and pay any Capital Gain Tax due, to HMRC within 60 days of completion. The gain needs to be reported using HMRC’s online reporting which requires a Government Gateway Account.

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Business Asset Disposal Relief ( BADR)

Admin — Wed, 12 Jun 2024 11:54:32 +0000

An individual selling a business ( or in some instances part of a business) can benefit from a Capital Gains Tax relief which can mean that any gain arising on the sale is taxed at a current rate of 10%. The conditions which must be met in order to qualify for the relief are:-

The asset must have owned for a minimum of 2 years.
If shares in a company then the individual selling must own at least 5% of the ordinary share capital and be either an employee or director.

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Directors Remuneration

Admin — Sun, 09 Jun 2024 07:52:30 +0000

The most tax and NI efficient way to remunerate director shareholders is to pay an annual salary at the primary NI threshold ( this is currently £12,570 for the 2024-25 tax year), with additional remuneration taken as dividends. This ensures that the director qualifies for state benefits , including the State Pension, but does not have to pay any NICs. A directors liability to NI is calculated on an annual basis as opposed to other employees whose liability is based on each pay period ( either weekly or monthly). Contact us for more information.

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