The Bank of England (BoE) has increased interest rates to 1.75%, the first rise of half a per cent in over 20 years. The latest increase is the fifth rise since December 2021, with the BoE arguing that rate rises are needed to tackle soaring inflation. Inflation as measured by the consumer price index (CPI)…

Make use of these allowances while they last. When a business incurs costs, such as salary payments or stationary procurement, it can usually fully deduct them as expenses from its taxable profits, reducing the tax due. However, when it buys assets for operational purposes, things are not quite so straightforward. There are HMRC incentives to…

The Government has announced plans to relax capital gains tax (CGT) rules in divorce settlements, giving spouses and civil partners more time to transfer assets without incurring CGT charges. If the new rules are approved, they will come into effect from 6 April 2023. Newly separated couples are currently given until the end of the…

The Government’s ‘help to grow: digital’ scheme has now expanded to include businesses with fewer than five employees. Over a million more businesses will now be eligible for the scheme, which has also been expanded to include one-to-one advice and additional software. Launched in January this year, the scheme was established to help small to…

The Government has announced a £400 energy bill grant will be paid to customers over six payments to help households cope with the cost of living crisis. As part of an £11.7 billion energy support package, some 29 million households will receive grants to help pay for their energy bills this winter, starting in October.…

An overview of the Government’s seven steps. Hiring an employee for the first time is an exciting moment for any business owner. Suddenly, you’ve got another pair of hands to help out with jobs that used to fall entirely on you – and with that extra support, new opportunities for growth are possible. There’s a…

The Bank of England is determined to return UK inflation to its 2% target as prices continue to soar. In a speech at King’s College in London, chief economist and executive director for monetary analysis at the Bank of England Huw Pill said it was “essential” to bring inflation back to target. In May 2022,…

Self-employed individuals are having difficulties completing their self-assessment tax return, according to a new report commissioned by HMRC. A lot of people have trouble with their tax reporting duties because of “confusing terminology, ambiguity around allowable business expenses and uncertainty transferring figures to HMRC’s system,” according to the report. Undertaken by Kantar on behalf of…

Smaller businesses don’t believe that Making Tax Digital (MTD) applies to them, according to a study carried out by Yonder Consulting for HMRC. While businesses indicated they were aware of MTD for VAT, many still do not understand the process of the scheme and whether their business needs to comply with the rules. In a…

The Government has published a response to its consultation on strengthening audits, corporate reporting and corporate governance systems. The long-awaited response outlines the Government’s plans to tackle dominance of large auditors, ban failing ones and bring unlisted companies under the scope of the regulator. The current Financial Reporting Council will also be replaced by a…

The Government is increasing the threshold at which workers start to pay National Insurance contributions (NICs) by £12,570 this month – the largest increase in a basic rate threshold. The increase in the threshold means workers can earn an extra £2,690 before having to pay NICs. The change also brings the NIC and income tax…

People are unprepared and unenthusiastic for Making Tax Digital (MTD), according to a survey commissioned by HMRC. Global market research group Ipsos recently released data suggesting “awareness of MTD in general, and MTD for income tax self-assessment (ITSA) specifically was low”. MTD ITSA will require people with annual business or property income above £10,000 to…

The Government’s flagship Covid business recovery scheme officially came to an end late last month (30 June). The recovery loan scheme opened to applications on 6 April 2021 to help businesses cope with trade lost to the Covid pandemic. The scheme offered £1.06 billion to small businesses through almost 6,200 facilities, with the latest figures…

How to reduce penalties for accounting errors. HMRC recently announced new powers to investigate companies they suspect of evading taxes, so as a business owner, you might be worrying about what happens if your company comes under scrutiny. Even if you’ve played entirely by the rules, the stress of an investigation can be a lot…

The Government has at last increased National Insurance (NI) and dividend tax by 1.25 percentage points after months of anticipation. The 1.25% uplift came into effect on 6 April 2022 and will apply until April 2023, after which a separate health and social care levy will apply on peoples’ income at 1.25%. The Government said…