Let us hope that 2018 presents opportunities to build our business interests and improve the financial position of our families. Certainly, there were many changes last year, not least the ongoing implications of the Brexit vote, that have proved to be challenging and not only for the politicians.
A reminder, as we look forward to the new year, that our actions in the future will be dictated to some extent by past changes. We have listed below just a few of these challenges, some of which we reported in length last year, and many of which will require action on our part in the coming year.
If you are in business:
- Deal with your obligations, if any, to comply with the General Data Protection Regulation. See the various articles we’ve previously posted on this topic, and there will be more to come.
- Deal with your obligations, if any, to comply with the Criminal Finances Act 2017 – again, see the article we posted on this topic last month.
- Review your management accounts before the end of your current account’s year to make sure that there are no changes required before the end of the trading year. From a tax planning point of view this is essential as once your trading year or tax year end passes opportunities to save tax may be permanently lost.
- Are you aware of your obligations to pay tax (VAT, corporation tax, income tax or other National Insurance liabilities) during 2018. At the end of this month your self-assessment dues for 2016-17 and payment on account for 2017-18 fall for payment.
- Are you in the most effective VAT scheme for your size and type of business?
- If you are still recording your accounts on spreadsheets or handwritten records, have you considered using internet based accounts software? Come the day we are required to upload our accounts data to HMRC under their Making Tax Digital program (MTD), using a computerised system now that links with the tax office IT will make the job less of a chore.
- Look at salary sacrifice opportunities especially if your taxable income for 2017-18 will exceed £100,000 for the first time. Any strategy that shifts income into tax-free benefits could save you marginal tax at 60% if you have earnings between £100,000 and £123,000.
- Parents claiming child benefit should be wary if one partner’s earnings are likely to exceed £50,000 for 2017-18. A High Income Child Benefit Charge may apply. This could mean benefits being repaid to HMRC and the possibility that you may have to register for self-assessment for the first time.
- Check out your eligibility to pay more into your pension fund before 6 April 2018.
- Have you fully utilised your tax allowances for 2017-18? For example, your personal tax allowance £11,500; the capital gains tax exempt amount £11,300; and inheritance tax tax-free gifts allowances.
- Have you taken advantage of the £20,000 ISA limit?
Please call us at Jones Harris if you would like to review any of these or other planning opportunities for 2017-18. Don’t forget that once the year end passes any likely benefits that you could have benefitted from may be permanently lost.