New company car advisory fuel rates have been published which took effect from 1 March 2017. The guidance states: ‘You can use the previous rates for up to one month from the date the new rates apply’. The rates only apply to employees using a company car.
The advisory fuel rates for journeys undertaken on or after 1 March 2017 are:
Engine size | Petrol |
1400cc or less | 11p |
1401cc – 2000cc | 14p |
Over 2000cc | 22p |
Engine size | LPG |
1400cc or less | 7p |
1401cc – 2000cc | 9p |
Over 2000cc | 14p |
Engine size | Diesel |
1600cc or less | 9p |
1601cc – 2000cc | 11p |
Over 2000cc | 13p |
Other points to be aware of about the advisory fuel rates:
If you would like to discuss your car policy, please contact us.
With the end of the tax year looming there is still time to save tax for 2016/17. We have set out some points you may want to consider.
This is only a selection of options that you may wish to consider as part of your tax planning strategy. For more information, and for advice on how we can help you to minimise your tax bill, please contact us.
Please contact us to discuss your personal situation.
With two Budgets in 2017, and the Spring Budget scheduled for Wednesday 8 March 2017, the Confederation of British Industry (CBI) have written to the Chancellor Philip Hammond outlining what they would like to see in the Budget proposals.
The CBI’s letter calls for the government to ‘back businesses’ growth ambitions’ to help build prosperity across the UK, and to work alongside firms to ‘prioritise stability’ during periods of economic uncertainty.
The CBI has also urged the government to tackle the UK’s ‘outdated’ business rates regime and limit its ‘growing burden’ on businesses.
Elsewhere, the Federation of Small Businesses (FSB) has advocated for a ‘pro-business Budget’ that supports self-employed individuals, urging the government to help more people start up in business.
We will keep you informed of pertinent Budget announcements.
Internet links: CBI news FSB news
HMRC have released a list of the most outlandish items which have been claimed as expenses. These include:
Ruth Owen, HMRC Director General of Customer Services, said:
‘Year after year we receive a number of ludicrous expense claims, ranging from international holiday flights to expensive designer clothing, which we would never uphold. Why should the honest taxpayer pick up the bill for others? HMRC will only accept those claims which are genuine, such as legitimate travel expenses or the cost of tools for the job.’
For help with your tax affairs please do get in touch.
Internet link: GOV.UK news
Hundreds of thousands of savers have cashed in £9.2 billion from their pension pots since pension freedoms were introduced in April 2015.
In April 2015, the government introduced significant pension reforms giving people the ability to access their pensions savings how and when they want. Over 1.5 million payments have been made using pension freedoms, with 162,000 people accessing £1.56 billion flexibly from their pension pots over the last three months, according to HMRC figures.
The Economic Secretary to the Treasury, Simon Kirby, said:
‘Giving people freedom over what they do with their hard-earned savings, whether it’s buying an annuity or taking a cash lump sum, is the right thing to do. These figures show that people continue to take advantage of the choices on offer: choices only made available since the government’s landmark pension freedoms were introduced in April 2015.
We are working with our partners, including Pension Wise, the regulators and pension firms, so that savers have the support they need to understand the options available to them.
The statistics show that in the first year of these new rules being available, more than 232,000 people have accessed £4.3 billion flexibly from their pension pots.’
Internet links: GOV.UK news Statistics
The Lifetime Individual Savings Account (ISA) is a longer term tax-free account that receives a government bonus. The accounts will be available from 6 April 2017. HMRC have produced a helpful guide on the account. Some of which is reproduced below:
Opening a Lifetime ISA
You can open a Lifetime ISA if you’re aged 18 or over but under 40.
As with other ISAs, you won’t pay tax on any interest, income or capital gains from cash or investments held within your Lifetime ISA.
Saving in a Lifetime ISA
You can save up to £4,000 each year in a Lifetime ISA. There’s no maximum monthly savings contribution, and you can continue to save in it until you reach 50. The account can stay open after then but you can’t make any more payments into it.
The £4,000 limit, if used, will form part of your overall annual ISA limit. From the tax year 2017 to 2018, the overall annual ISA limit will be £20,000.
Example
You could save:
Your Lifetime ISA won’t close when the tax year finishes. You’ll keep your savings on a tax-free basis for as long as you keep the money in your Lifetime ISA.
Lifetime ISAs can hold cash, stocks and shares qualifying investments, or a combination of both.
Government bonus
When you save into your Lifetime ISA, you’ll receive a government bonus of 25% of the money you put in, up to a maximum of £1,000 a year.
Withdrawals
You can withdraw the funds held in your Lifetime ISA before you’re 60, but you’ll have to pay a withdrawal charge of 25% of the amount you withdraw.
A withdrawal charge will not apply if you’re:
If you die, your Lifetime ISA will end on the date of your death and there won’t be a withdrawal charge for withdrawing funds or assets from your account.
Transferring a Lifetime ISA
You can transfer your Lifetime ISA to another Lifetime ISA with a different provider without incurring a withdrawal charge.
If you transfer it to a different type of ISA, you’ll have to pay a withdrawal charge.
Saving for your first home
Your Lifetime ISA savings and the bonus can be used towards buying your first home, worth up to £450,000, without incurring a withdrawal charge. You must be buying your home with a mortgage.
You must use a conveyancer or solicitor to act for you in the purchase, and the funds must be paid direct to them by your Lifetime ISA provider.
If you’re buying with another first time buyer, and you each have a Lifetime ISA, you can both use your government bonus. You can also buy a house with someone who isn’t a first time buyer but they will not be able to use their Lifetime ISA without incurring a withdrawal charge.
Your Lifetime ISA must have been opened for at least 12 months before you can withdraw funds from it to buy your first home.
If you have a Help to Buy ISA, you can transfer those savings into your Lifetime ISA or you can continue to save into both – but you’ll only be able to use the government bonus from one to buy your first home.
You can transfer the balance in your Help to Buy ISA into your Lifetime ISA at any time if the amount is not more than £4,000.
In 2017/18 only, you can transfer the total balance of your Help to Buy ISA, as it stands on 5 April 2017, into your Lifetime ISA without affecting the £4,000 limit.
Internet link: GOV.UK news
HMRC have confirmed in the latest Employer Bulletin that changes will be made to the verification of subcontractors in the construction Industry Scheme (CIS) from 6 April 2017.
From 6 April 2017, contractors must use an approved method of electronic communication to verify their subcontractors. So from 6 April 2017 HMRC will no longer accept any telephone calls to verify subcontractors and from then contractors must verify subcontractors using:
This change is one of a series made to CIS to increase HMRC efficiency and accuracy, and to reduce administration. HMRC are also reminding contractors that they have also introduced additional features of the online system including the ability to amend returns online, and the addition of an online message/alert service.
Contact us for help with CIS issues.
Internet link: Employer Bulletin
In the latest Employer Bulletin HMRC advise those providing services to a public sector client through their own limited company to ensure they are ready for the new rules which take effect from 6 April 2017.
The new rules for off payroll working, commonly referred to as IR35 or the Intermediaries legislation, take effect from 6 April 2017.
These changes mean individuals working through their intermediary in the public sector will no longer be responsible for deciding whether the intermediaries’ legislation applies and then paying the appropriate tax and National Insurance contributions (NICs). This responsibility will instead move to the public authority client, agency, or third party that pays the worker’s intermediary, and they will also now become responsible for making sure that, where the rules apply, the relevant income tax and NICs are deducted and reported through PAYE in real time.
The public authority client is required to tell any agency or third party its view as to whether the rules apply. HMRC have been consulting on these new rules and the legislation has yet to be finalised.
HMRC confirm that ‘work is continuing on the development of the new Employment Status Service, and the online tool should be available for use in March. We have launched an off-payroll working in the public sector page on GOV.UK where you can find guidance for fee-payers, PSCs and public authorities to use, and links to material such as the technical note’.
If you have concerns in this area please contact us.
Internet links: Employer Bulletin Technical note
This information is subject to change and is not professional advice. Refer to our disclaimer for more details.