Monthly Archives: April 2022

Congratulations!

The Martlet Partnership is delighted to announce that our Jarrad Gilbertson has passed his final paper and has now completed all his examinations to become a member of the Chartered Association of Certified Accountants.

I am sure you will wish to pass on your good wishes to Jarrad, who works mainly in our tax department, and with whom many of you therefore are likely to come into contact during the coming year.

Managing economic uncertainty – 20 Practical Actions Businesses can take

Having just emerged from the pandemic, the UK and global economy is facing a challenging future with rising inflation and interest rates globally. Global stock markets continue to perform well, but many would argue too well.

Closer to home households are facing significant price rises in pretty much everything from fuel to tomatoes. This will inevitably start to impact businesses, many of which have little, if any reserves left to face challenging times.

Alongside this backdrop, many businesses are facing challenges with their staff, with high sickness rates and ongoing implications from Covid.

What should businesses be doing to protect themselves, their people and their customers?

From prioritising debt and cashflow, to being highly communicative with your people, your customers and your suppliers; this handy guide provides you with a helpful action plan that will enable you to focus on and act in the right areas.

Most importantly, don’t wait, at a time of economic uncertainty, it is vital that you act quickly and decisively.

You can download your copy of the Managing Economic Uncertainty 2022: 20 Practical Actions Businesses can take guide here.

Happy New Year!

Today marks the start of the 2022/23 tax year and we are giving a summary of the changes which come in with effect from today or in some cases from 1^st April.

1. From 1 April 2022, all VAT registered businesses are required to follow the Making Tax Digital rule submitting VAT returns using HMRC approved software. This will cause difficulty for some businesses who have continued to maintain manual records and we will be contacting all our clients in this situation in the coming weeks.

• The temporary 12.5% VAT rate for hospitality businesses has finished and from 1 April 2022, the standard rate of 20% applies once more.

• From 1 April 2022 until 31 March 2027, VAT on installations of energy saving materials such as solar panels, insulation and heat pumps, will be 0%.

• From today, National Insurance contributions for employers and employees alike increase by 1.25%.

• From today, the Employment Allowance allowing small businesses to reduce their National Insurance liability increases from £4,000 to £5,000.

• The National Minimum Wage and National Living Wage increase by 11.9% for apprentices and 6.6% for workers aged 23 or over.

• A new Plastic Packaging Tax has come into being. A charge of £200 per tonne of plastic packaging manufactured or imported into the UK that does not contain at least 30% recycled plastic, is now applicable. Exemption is given to manufacturers or importers of less than 10 tonnes of plastic packaging per annum.

If you would like to speak with us about how any of these changes impact your own situation, then please do not hesitate to contact us.

Year-end Tax Tips

We are now very close to the end of Income Tax year ending 5 April 2022 but there is still time to implement a few steps which may help reduce tax liabilities and protect wealth for some of our clients so therefore please have a look at the points below and if they are applicable to you, there is still just about time to act.

• Annual pensions allowances

If you are a higher rate taxpayer, you can reduce your tax liability by making pension contributions up to a total of £40,000. If you have spare funds, then it is far more attractive to get tax relief at higher rates.

• Individual Savings Account (ISA) allowances

Tax free saving products like ISAs have not been of enormous value over recent years because of the appalling low interest rates, but interest rates are now rising. Up to £20,000 per adult can be subscribed to an ISA before midnight on 5^th April.

• Saving for children

Making investments for children when they are young, (and the younger the better), is a powerful tool which can generate large funds by the time they reach adulthood. Up to £9,000 a year can be paid into a junior ISA and also pension contributions up to £2,880, which are topped up to £3,600 can be made for children, even if they have no tax liabilities.

• Capital Gains Tax allowances

Not that many people are likely to have capital gains on a regular basis but each person can make capital gains tax free up to £12,300 per annum. It is far better to make a £12,300 gain today and then another £12,300 gain in early April rather than a £24,600 gain after 6 April, which will give rise to tax. Also, if you have capital gains liability this year, it might be worth disposing of other assets which would give rise to a loss which could offset the gain.

• Other tax-friendly investments

Subscriptions can be made to venture capital trusts which offer 30% Income Tax relief on new share issues can be offset against Income Tax liability during the tax year of purchase. Therefore, if this relief is attractive, there is still time to use these vehicles.

• Gifts to reduce Inheritance Tax

There are many urban myths surrounding Inheritance Tax liabilities but if you are likely to have an Inheritance Tax liability, and wish to make gifts to family, you can make gifts up to £3,000 each year and it will not be counted as part of your Estate.

It is appreciated that these measures will not apply to many people at all but if anybody would like further information, then please do not hesitate to contact us.