Tax in the UK follows a progressive structure, meaning the more you earn, the higher the percentage of tax you pay on the additional income. This blog covers the tax bands, allowances and rates for the 2024/25 and 2025/26 tax years. Your Tax-Free Personal Allowance...
Holiday Accrual on SSP When employees are unable to work due to sickness, they may be eligible for Statutory Sick Pay (SSP), currently set at £116.75 per week for up to 28 weeks in the UK. During these periods, employees still accrue Holiday or Annual Leave. Employees...
What is a P11D? The P11D form is used by employers to report expenses and benefits provided to directors and employees that are not processed through payroll. Examples include company cars, health insurance, and other non-cash benefits. Each director or relevant...
What is the VAT Flat Rate Scheme? The VAT Flat Rate Scheme (FRS) simplifies the way small businesses manage their VAT payments. Instead of calculating the VAT on every transaction, businesses pay a fixed rate of VAT to HMRC – depending on the industry. Key...
Corporation Tax is a tax on company profits, payable to HMRC. Unlike Income Tax, businesses do not receive a bill for Corporation Tax. Instead, they must calculate, report and pay it themselves. It applies to: Limited companies Foreign companies with a UK branch or...
What is Double Entry Bookkeeping? Double Entry Bookkeeping is an accounting technique that records each financial transaction twice – once as a debit in one account and once as a credit in another. This method bases itself on the accounting equation: Assets =...
Student Loans are a form of support provided by the UK Government to help students cover the cost of attending university or college. They make higher education accessible to everyone, regardless of background. Student loans fall into two types: Tuition Fee Loans...
Marriage Allowance Transfer Marriage Allowance transfer allows one spouse to transfer a portion of their Personal Tax Allowance to the other, providing a tax reduction if certain conditions are met. Who is Eligible? You may qualify for Marriage Allowance if:...
What is Marriage Allowance? Marriage Allowance is a government initiative aimed at reducing the tax burden for married couples or civil partners. This scheme allows one partner to transfer a portion of their unused personal tax allowance to their spouse or civil...
Trivial benefits are small gifts or perks provided to an employee that costs £50 or less. To qualify as a trivial benefit, the gift must meet the following criteria: It costs £50 or less to provide, including VAT. It isn’t cash or a cash voucher. It isn’t...
Tax on Tips and Gratuities All tips and gratuities, whether received in cash directly from the customer or added electronically via card or cheque, are subject to Income Tax. Depending on how these tips are managed and distributed, National Insurance Contributions...
Child Benefit is valuable support for families raising children in the UK. But if HMRC considers your income high, they may apply a tax charge called the High Income Child Benefit Charge. What is the High Income Child Benefit Charge? High Income Child Benefit Charge...
Dividends are payments that limited companies distribute to their shareholders from their profits. If a company makes a profit after covering all expenses and taxes, it can choose to share some of that profit with its shareholders. These payments provide shareholders...
What is Net Profit? Net Profit is the amount of money that remains from a business’ revenues after all operating expenses, interest, taxes, and other costs have been subtracted. It is a clear indicator of a company’s financial performance over a specific...
What is Gross Profit? Gross Profit refers to the total revenue subtracted by the cost of goods sold (COGS). These costs include all the expenses directly associated with the production of goods or services your business sells, such as raw materials and labour. It does...
The Construction Industry Scheme, or CIS for short, is a tax deduction system which ensures that contractors correctly handle tax payments for subcontractors. The scheme help regulate tax compliance and prevent tax evasion by requiring tax deductions at the source....
Payments on Account are advance payments towards your tax bill, based on your earnings from the previous year. HMRC assumes your income will remain the same and calculates your tax bill accordingly. Instead of paying your full tax bill in one lump sum, you make 2...
7th June VAT Deadline The 7th June marks the due date for VAT returns and payment for the quarter ending 30th April if the returns are filed electronically. This deadline applies to businesses that file their VAT returns electronically, which is now the norm under the...
HMRC use the Self Assessment system to calculate and collect tax on Rental Income. For landlords that earn more than £1,000 annually from rental properties, you must declare this income through Self Assessment. Failing to do so will result in hefty penalties. Do You...
Chattels and Their Tax Implications Chattels are legally defined as ‘tangible movable property’, also referred to as Personal Property. These are physical items that can be touched and moved without altering the structure of a building or land. Examples...
The UK Parliament has recently introduced a new legislation called the Renters’ Rights Bill 2024, which aims to address key challenges in the rental market and ensuring fairness between all parties involved. Therefore, creating a more secure rental market for...
While the idea of earning less money might seem strange at first, salary sacrifice can actually make sound financial sense. This is because the sacrificed portion of your salary may not be subject to Income Tax or National Insurance Contributions, depending on what...
Double Cab Pick Ups Before the legal and political debates, Double Cab Pick Ups (DCPUs) were widely classified as “goods vehicles” for tax purposes. This classification provided the following benefits: Capital Allowances – Businesses could deduct a...
P60 Deadline Following the end of the financial year in the UK, all employers should be looking to issue their employees with their P60. This document summarises an employee’s total earnings and deductions for the year just ended. Ensuring that the P60 is issued...
