Understanding your tax code is essential for ensuring you’re receiving the right tax allowances and deductions. The letters in your tax code signify your entitlement to the annual tax-free personal allowance and help your employer calculate how much tax to deduct from your pay packet. For the current and upcoming tax year, the basic personal […]
Dividends received are subject to taxation as income, although the applied tax rates differ from the formal Income Tax rates. Additionally, individuals can receive dividends up to the annual tax-free dividend allowance. The annual dividend allowance for the tax year 2023-24 is £1,000. The prevailing tax rates for dividends received (beyond the dividend tax allowance)
Most self-employed individuals are liable for two types of National Insurance contributions (NICs): Class 2 NICs and Class 4 NICs. Class 2 NICs apply to all self-employed taxpayers unless their earnings fall below the Small Profits Threshold (SPT), currently set at £6,725, which exempts them from NIC payments. As of the 2023-24 tax year, Class
In the UK, directors are categorised as employees and are subject to National Insurance (NI) contributions on their annual income, including salary and bonuses, that exceeds the Primary Threshold. For the current 2023-24 tax year, the annual threshold is set at £12,570. Many directors who are also shareholders opt to receive a minimum salary and
From 1 April 2023, the corporation tax main rate will increase to 25% for companies with profits over £250,000. A Small Profits Rate (SPR) of 19% will also be introduced from the same date for companies with profits of up to £50,000 ensuring these companies pay Corporation Tax at the same rate as currently. Where
The Construction Industry Scheme (CIS) is a set of special rules for tax and National Insurance for those working in the construction industry. Businesses in the construction industry are known as ‘contractors’ and ‘subcontractors’ and should be aware of the tax implications of the scheme. Under the Construction Industry Scheme, contractors are required to deduct
MTD for landlords will require the landlord to register, file, pay and update their information using an online tax account. The introduction of MTD for Income Tax Self-Assessment (ITSA) is not set to commence from April 2024. The rules will initially apply to taxpayers who file Income Tax Self-Assessment tax returns with business or property income
2016 was the first-time dividends tax allowance was introduced and it replaced the old dividend tax credit with an annual £5,000 dividend allowance. Tax was payable on dividends received over this amount. The tax-free dividend allowance was reduced to £2,000 with effect from 6 April 2018 and remains fixed at that level ever since. The
On Friday 23rd September, Chancellor Kwasi Kwarteng MP, shared the Conservative Government’s mini budget plans in the House of Commons, stating: People need to know help is coming and it is indeed coming Chancellor Kwasi Kwarteng MP You will find a summary below of the key points raised in the mini budget, including the topics of
If you are a sole trader or property landlord change is on the way. Making Tax Digital (MTD) will become mandatory for not only VAT-registered businesses but sole traders and property landlords. Making Tax Digital for Income Tax Self-Assessment (ITSA) will apply to individuals from April 2024, if their total gross income from self-employment and