PERSONAL ACCOUNTING & TAX

Self Assessment

Many individual taxpayers may struggle to understand and complete their tax return correctly and the continuing changes to tax legislation is not reducing the burden or complexity.

We can prepare and submit your self assessment tax return for you. We can offer advice on how you can minimise your tax liability, complete the necessary computations, and complete and submit your return.

We can also act as your agent and liaise directly with HM Revenue and Customs on your behalf.

TAXABLE INCOME BANDS AND TAX RATES

* The starting rate does not apply if taxable income exceeds the starting rate limit        

ALLOWANCES THAT REDUCE TAXABLE INCOME OR ARE NOT TAXABLE   

* The personal allowance is reduced by £1 for each £2 of income from £100,000 to £125,000 (2019/20: £125,000).

** Any unused personal allowance may be transferred to a spouse of civil partner, where the recipient is not liable to higher or additional-rate tax.  

*** Note that landlords and traders with gross income from each of these sources in excess of £1,000 can deduct the allowance from their gross income as an alternative to claiming expenses.        

ALLOWANCES THAT REDUCE TAX

Available to people born before 6 April 1935. The age for MCA is that of the elder spouse or civil partner. The loss of tax reduction is 10p for each £2 of income above £30,200 (2019/20: £29,600) until £351

(2019/20: £345) is reached.                    

HIGH-INCOME CHILD BENEFIT CHARGE

There is a tax charge of 1% of the child benefit received for each £100 that the threshold is exceeded up to a maximum of 100%.                    

NATIONAL INSURANCE  

Class 1     

* Entitlement to contribution-based benefits are retained for earnings between £120 and £183 per week. 

** 0% for employees under 21 and apprentices under 25 on earnings up to £962 per week.                    
                 

Class 1A    

Class 2

Class 3

Class 4

Exemption applies if the state retirement age is reached by 6 April 2020.                    

Employment Allowance

* One claim only for companies in a group or under common control. Not available where the director is the only employee paid earnings above the secondary threshold for class 1 NICs. From April 2020, this will be limited to employers with an employer NICs bill below £100,000 in the previous tax year.                    

Apprenticeship Levy

A levy of 0.5% applies where the pay bill exceeds £3M. There is an allowance of £15,000. Further conditions also apply.                        

CAPITAL GAINS TAX  

INHERITANCE TAX 

* Up to 100% of any unused part of a deceased person's nil-rate band can be claimed by the surviving spouse/civil partner on their death. This also applies to the main residence nil-rate band, albeit the main residence nil-rate is subject to the taper withdrawal below.                    

** For estates in excess of £2M, a 50% taper withdrawal applies to the excess.                    

Tax rates

* All lifetime transfers not covered by exemptions and made within seven years of death will be added back into the estate for the purposes of calculating the tax payable. This may then be reduced as shown in the table below.

** Applies if 10% or more of net chargeable estate is left to a UK-registered charity.                  

TAX-EFFICIENT INVESTMENTS                        

* Reduces ISA limit by amount invested in Lifetime ISA.

** Up to £2M in a knowledge intensive company.                

REGISTERED PENSIONS

* Tapered at a rate of 50% of income down to £4,000 (2019/20: £10,000) if threshold income over £200,000 (2019/20: £110,000) and adjusted income over £240,000 (2019/20: £150,000). Restrictions may also apply based on net relevant earnings.               

Subject to certain conditions, the unused amount of the annual allowance can be carried forward up to three years and used once the current year annual allowance has been fully utilised.                    

STAMP DUTY 

PROPERTY TAXES

The incremental rate of tax is only payable on the part of the property price within each band. An additional 3% rate (4% in Scotland) applies to the purchase of an additional residential property above £40,000 and all corporate residential properties.                

England and Northern Ireland: Stamp duty land tax

* First time buyers pay nothing on the first £300,000 for properties up to £500,000. A rate of 5% applies between £300,000 and £500,000. 

For residential purchases by 'non-natural persons' over £500,000 a rate of 15% applies, subject to certain exclusions.                

    Scotland: Land & buildings transactions tax  

* First time buyers pay nothing on the first £175,000.  

    Wales: Land transaction tax    

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