Archive for January, 2016

Quarterly accounts filing

Tuesday, January 5th, 2016

At present smaller businesses are required to file accounts once a year with HMRC when their Self Assessment or Corporation Tax returns are filed.

HMRC are now moving towards the provision of a digital account for business owners, a portal that will allow taxpayers to manage their tax affairs online. In the draft notes for the Finance Bill 2016 there is further clarification of the way in which HMRC will expect this digital account to be used.

Here’s what they have to say:

 “Making Tax digital – As announced at Autumn Statement, the government will invest £1.3 billion to transform HMRC into one of the most digitally advanced tax administrations in the world. Most businesses, self-employed people and landlords will be required to keep track of their tax affairs digitally and update HMRC at least quarterly via their digital tax account. HMRC will ensure the availability of free apps and software that link securely to HMRC systems and provide support to those who need help using digital technology. This will not apply to individuals in employment, or pensioners, unless they have secondary incomes of more than £10,000 per year. The government will publish its plans to transform the tax system shortly and will consult on the details in 2016.”

This declaration is likely to have wide ranging implications. For example, will HMRC use this data to require taxpayers to pay their tax quarterly instead of twice yearly (if self employed), or annually if incorporated? Will tax due be based on current year earnings instead of prior year profits?

As stated, HMRC will be consulting on the detail this year. We will be keeping a careful eye on the outcome of their deliberations. Readers should be aware that these changes are unlikely to be implemented before 2020.

Stamp Duty increase for second home buyers

Tuesday, January 5th, 2016

George Osborne and his team seem to have a grudge against landlords and second home owners. From 1 April 2016, Stamp Duty Land Tax (SDLT) payable on the acquisition of residential property – where the property is a second home or a buy-to-let investment – will see a significant increase in the amount of SDLT payable.


At present, this will only apply to properties purchased in England and Wales. In Scotland, the new Land and Buildings Transaction Tax applies.


For example:


Andy Jones is considering a further acquisition for his Midlands based buy-to-let property business of £300,000. What are the SDLT implications of buying before or after 1 April 2016?


Completion date 1 March 2016 – SDLT payable would be £5,000.

Completion date 1 May 2016 – SDLT payable would be £14,000.


The virtual tripling in SDLT due is a result of the 3% increase in SDLT rates from 1 April 2016. For acquisitions after 1 April 2016 the new rates are:


£0 to £40,000 no SDLT is payable

£40,000 to £125,000 – 3% on total cost of acquisition

£125,001 to £250,000 – 5% on this band only

£250,001 to £925,000 – 8% on this band only

£925,001 to £1.5m – 13% on this band only

Over £1.5m – 15% of the property price above this amount


Will this fuel a rush to buy before rates increase on 1 April 2016? Prospective buyers may want to consider this option, but don’t buy in haste and repent at leisure!

Business flood victims support fund

Monday, January 4th, 2016

Businesses caught up in the devastation of Storm Eva will be able to apply for £6 million of government money to get their doors back open to customers.

Read Winter flooding 2015: community support for advice and current information.

The Department for Business, Innovation and Skills announced the cash pot would be made available for the estimated 2,500 firms on either side of the Pennines left flooded by the Boxing Day deluge in the north of England.

The £6 million package adds to the £5 million already announced by the government to help businesses in Lancashire and Cumbria affected by Storm Desmond earlier in December.

Small Business Minister Anna Soubry said:

It’s been a devastating Christmas for many business owners in the north of England who now face the challenge of repairing the damage and reopening their doors.

Small businesses are the lifeblood of towns and cities right across the country and it is vital that we help them start trading again as soon as possible.

This £6 million is being made available immediately by the government and is part of a wider package of support designed to get people, communities and businesses back on their feet.

The money forms part of a wider £50 million relief package announced by Communities Secretary Greg Clark on Tuesday, to support households, businesses, communities and local authorities. It is available to businesses caught up in the flooding caused by Storm Eva.

Local Growth Hubs have more information and should be contacted on how to access the business support.

This announcement follows the £5 million business support scheme to help businesses affected by Storm Desmond announced on 9 December