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November 2018 Monthly News - Able Accountants

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If you’re keen to read the latest events and news for November, as they related to accountancy, you’re in the right place. We’re keen to give you all the latest info and keep you in the loop so you have all the essential details from the world of accountancy, right at your fingertips.

We regularly post updates, so check back here to absorb the latest happenings and discover how they can impact your accounting matters.

“No Deal Brexit” Contingency Plans

A Partnership Pack has been announced and issued by HMRC in an effort to help businesses to plan and also to help customers as thoughts turn to the following:

1. Adapting business to work with new systems and processes.
2. The effect of increased customs declarations.
3. Recruitment and training of additional staff.

The Confederation of British Industry (CBI) has reported that amongst UK businesses “patience is now threadbare” as the government continues with Brexit talks. The Director General of the CBI, Carolyn Fairbairn, went on to say:

“The situation is now urgent. The speed of negotiations is being outpaced by the reality firms are facing on the ground. Unless a Withdrawal Agreement is locked down by December, firms will press the button on their contingency plans. Jobs will be lost and supply chains moved. As long as 'no deal' remains a possibility, the effect is corrosive for the UK economy, jobs and communities.”

Employers Issued New Guidance

Payroll issues have received an update with the October 2018 Employer Bulletin, issued by HMRC. A handful of articles within the publication covered a raft of areas, such as:

1. Clearer rules for paying employees whose regular payday falls on a non-banking day.
2. Reminders for contractors for the Construction Industry Scheme.
3. Clarification on rates of pay for apprentices.
4. Tax code adjustments happening in real time.
5. Childcare vouchers and the offer of directly contracted childcare to be closed to new entrants.

Changes to Capital Allowances

The latest budget included a raft of changes to capital allowances, such as the 2-year increase, from 1 January, in the Annual Investment Allowance (AIA) to £1,000,000, as it pertains to qualifying expenditure. Currently the AIA stands at £200,000 per year.

There are other changes and they include:

1. Plant and machinery pool’s special rate is to be reduced. This includes long-life assets, integral features and expenses on cars higher than 110g/km of the CO2 emissions.
2. Plant, and machinery, installations can result in land alterations, and there are some costs that may qualify for capital allowance. These costs are to be made clearer for claims.
3. There is currently a 100% allowance in the first year for expenditure incurred on electric charge equipment. This will be extended until 2023.

There shall also be a fresh capital allowance programme that will be introduced for structures and buildings, and will be titled: The Structures and Buildings Allowance. This will be available for new non-residential structures and buildings.

Changes to Personal Tax

One of the biggest matters to come out of the most recent budget was that there will be increases to the personal allowance and basic rate band for 2019/2020.

£11,850 is the current personal allowance, but this will increase for 2019/2020 to £12,500. For that same period the basic rate band will also be increased to £37,50. This means that the 40% rate will be £50,000 for those entitled to the full personal allowance. Additional rate tax (45%) will remain in effect for incomes over £150,000 liable to taxation. This is in keeping with the government’s policy to increase thresholds by 2020/2021.

Deadline For Submitting Form P46 (Car)

The all-important P46 (car) is due on the 2nd November and this is a significant date your accounting calendar, so don’t overlook it may have a dramatic impact you.

What is the P46 (car)? Let us refresh your memory. It is for employees who take advantage of car/fuel benefits, specifically those employees who saw a change to their benefits in the third quarter of this year, running up to 5th October, 2018.

A form P46 (car) needs to be completed for any employee who uses a car that has been provided by their employer. The specific situation where a form P46 (car) is required is where:

● a car was initially supplied to an employee by an employer
● an additional car was supplied to an employee by an employer
● an employer took back a car they had supplied to an employee and it wasn’t replaced

Why is the form P46 (car) necessary? Well, with one of these completed forms HMRC can update the employee’s coding notice so that it corresponds with the change in benefit that the employee is receiving, or no longer receiving.

The form can be submitted either online, or by completing a hard copy and sending it in. In cases where a car has been taken back by an employer and replaced with another, the change can be made online.

Watch out! The form P46 (car) should not be used to notify HMRC of any changes in car for car benefits that have been “payrolled”.

PAYE, Student Loan and CIS Deductions

A major monthly event on Monday 19th November that, if it applies to you, should not only be stamped on your calendar, but etched into your mind.

PAYE, student loan and CIS deductions are particularly significant to employers who make payments on behalf of their employees by making deductions directly from their salaries. This is also relevant to contractors who have issued payments to subcontractors under the Construction Industry Scheme (CIS).

Many will make the payment electronically and funds from these payments are expected to have cleared by 22nd November, 2018. Payments that have failed to clear by this date will incur interest charges and other penalties may also apply, so fair warning!

Be aware that payments, on behalf of your employees, for income tax, national insurance and student loans should be made to HMRC. This also applies to contractors making tax payments on behalf of subcontractors under the Construction Industry Scheme, as these will also need to be made to HMRC.

That’s everything for now, but check in with again soon as we will have more updates for December as we gear up for seasonal cheer and festive frivolities!

More to Come

We’ll be updating this post in November to make sure all the other latest news and updates are at your finger-tips.

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