Wishing you a Merry Christmas & a Happy New Year

Christmas Snowman

We would like to take the opportunity in wishing all of our clients and contacts a Merry Christmas and a successful 2016.

We have put together our own version of the 12 days of Christmas. If you would like to find out more on any of these tips, please get in touch and we can work with you to ensure you achieve your goals and ambitions for 2016.

The 12 tips of Christmas

  1. Holding a Christmas party? – HMRC will allow employers to spend up to £150 per employee on annual events
  2. Wanting to give a Christmas bonus? – All bonuses are subject to PAYE and must be paid within 9 months of the year end in which you would like the deduction
  3. Can I give my employees a tablet as well as a mobile phone? A Tablet provided by an employer to employees will be exempt from tax if there is no significant private use. This can be provided in addition to a mobile phone or SIM card.
  4. Wanting to pay staff early? – With RTI, remember that details of your payroll need to be submitted to HMRC before payment is made to your staff.
  5. Christmas gifts for employees – HMRC provide the following concession; “An employer may provide employees with a seasonal gift, such as a turkey, ordinary bottle of wine or a box of chocolates at Christmas. All of these gifts are considered to be trivial and as such are not taxable”
  6. A gift of cash for family? – Inheritance Tax needs to be considered here, and there are a number of exempt gifts:
      1. – small gifts (less than £250 per person per annum)
      2. – gifts within the standard annual exemption (£3,000 per annum)
      3. – gifts made in consideration of marriage (£5,000 per child or £2,500 per grandchild)

    – ‘normal gifts out of income’It is important to keep records of gifts made for Inheritance Tax purposes, and we would recommend discussing any gift with us before making it.

  7. A gift for life – If you are saving to buy your first home or wanting to assist your children in doing so, save money into a Help to Buy ISA and the government will boost your savings by 25%. For every £200 you save, receive a government bonus of £50. The maximum government bonus you can receive is £3,000.
  8. Annual Investment Allowance (AIA) – The AIA Limit will be reduced to £200,000 from 1 January 2016.
  9. Directors Dividend changes – From 6 April 2016, the tax system surrounding dividends is changing. The 10% notional tax credit will be abolished, the Government are introducing a 0% band on the first £5,000 of dividends received during the year. The rates of income tax are also changing to 7.5% for basic rate tax payer, 32.5% for higher rate tax payers and 38.06% for additional rate tax payers. Bah Humbug
  10. Take time to plan for the New Year – Between January 2016 and March 2018, the number of employers reaching their Pension Auto Enrolment staging date will average more than 100,000 a quarter. Are you ready?
  11. A gift for small businesses – The Autumn statement didn’t grant business owners much to shout about but we did see an extension to the Small Business Rate Relief scheme, which helps the nation’s smallest firms to pay less tax on their premises.
  12. Christmas gifts for customers – Gifts for clients should not exceed £50 and must contain a ‘conspicuous advert’

 

Lastly before you get too “merry” don’t forget to plan for the New Year as automatic penalties are now imposed if you do not file your Self-Assessment Tax Return on time. Do not forget there is an automatic £100 fine if you do not file your return by 31st January 2016.

Please get in touch to discuss these tips on 0161 249 5040