Archive for March, 2024

Is this a good time for property owners?

Thursday, March 28th, 2024

The recent Spring Budget did little to make the life of those letting, buying or selling property any easier. For example:

  • The reduction in the higher rate of CGT on affected property sales from 28% to 24%.
  • The removal of multiple dwellings relief for Stamp Duty Land Tax purposes.

These competing changes must make life tricky for buyers and sellers.

Landlords, repairs or capital purchases

Landlords, who have been completely flummoxed by a recent round-Robin sent out by HMRC, suggesting that the replacement cost of a boiler with a more efficient version was a capital purchase not a repair, are relieved that it is, after all, a repair and not capital expenditure.

Owners of Furnished Holiday Let Properties

Owners of Furnished Holiday Let properties, who have enjoyed several tax breaks for many years – as their FHL business was treated as a trade and not an investment – must be disarmed by the Chancellor’s stated intention to abolish the FHL status from April 2025. Presumably, from that date, FHL property income and gains will be treated the same as a buy to let rental or sale.

It will be interesting to see if any transitional arrangement are put in place to soften the transition from April 2025.

Meanwhile, present owners of FHL properties may be advised to seek advice on any actions to be taken before April 2025. But beware, government has confirmed that anti-forestalling rules will be applied from the date of the Budget (March 2024) to block methods that obtain CGT relief under the current rules by utilising unconditional contracts ahead of the new rules coming in in April 2025. Draft legislation on this will be published later this year so more information will be available at that time.

Is this a good time for property owners?

Probably not if you own FHL property, but homeowners should escape aside from the Stamp Duty changes.

Principle Private Residence Relief – in most cases, no CGT to pay when you sell your own home – is still in place. You can still let out a room in your home and pay no tax if the rents received are less than £7,500 per annum and you abide by the Rent-a-Room Relief rules.

And if you are concerned by any of the issues raised in this post please call

Stand out from the crowd

Tuesday, March 26th, 2024

It’s interesting to consider the challenges that are plaguing small businesses at present. For example:

  • A frustrating inability to reestablish profit levels to fund investment or to maintain the living standards of employees and shareholders.
  • Cash flow constantly hovering at zero or at overdraft limits.
  • Having to witness the slow decline in profits retained in previous years to maintain dividend payouts or absorb current losses.
  • Making sense of the import and export rules since we left the EU.
  • The impact of higher interest rates; particularly, meeting rising repayments and their effect on profits and cash flow.

Not an inspiring background if you are a UK SME.

However, those companies who can make way in the face of these opposing headwinds can leverage their hard won achievements to sing their own praises.

Success breeds success.

Rudyard Kipling had it right in his poem “If you can keep your head when all around you are losing theirs…”

When your results evidence success, and you are in a minority at that time, then you will stand out from the crowd and be an attractive business partner.

In our experience, the one course of action that supports this positive business development outcome, is the willingness to engage in rigorous business planning. We can bear witness to this statement. And even if a business has to accommodate a reduction in profits for a period to meet external difficulties head-on, those affected who have flexible business plans in place will be the ones to weather the storm.

If you presently have no formal business plans, pick up the phone, let’s have a discussion to see how we could help and have your business stand out or the crowd.

Child Benefit claw-backs

Thursday, March 21st, 2024

One of the more impactful changes in the recent budget was the easing of the High Income Child Benefit Charge. Up to 5 April 2024, this has been recovering Child Benefits received by parents if the total income of one or more parent exceeded £50,000.

Basically, parents with income between £50,000 to £60,000 have had to repay all or part of their Child Benefits to HMRC as part of their self-assessment return.

Unfortunately, the following change will not apply to the present 2023-24 tax year or earlier years.

But from 6 April 2024, the lower limit is extended to £60,000 and the upper limit to £80,000. Accordingly, if the highest earner has income in excess of £60,000, for every £200 their income exceeds £60,000 they will have to repay 1% of the Child Benefits received, and when their income exceeds £80,000, effectively all Child Benefits received will have to be repaid.

The mechanism that HMRC use to facilitate this recovery is called the High Income Child Benefit Charge (HICBC).

But what to do if you have been required to register for self-assessment for 2023-24 or previous years and the highest parental income for 2024-25 will be higher than the old £50,000 limit but lower than the £60,000 or £80,000 new limits?

Consider the following options:

  • If you have previously cancelled your Child Benefits, as the HICBC charge would have recovered any benefits received. Consider re-registering for Child Benefits if the income of the highest earning parent is under £80,000.
  • If you registered for self-assessment for 2023-24 or earlier years affected by the HICBC, and the income of the highest earning parent is now under the £60,000 lower limit, and as long as you are not required to submit a self-assessment return for any other reason, then you could apply to HMRC to withdrawn from self-assessment and the obligation to submit a formal tax return each year.

Save on Easter child-care costs

Tuesday, March 19th, 2024

HM Revenue and Customs (HMRC) issued a press release recently reminding working families to save money on their childcare costs in time for the school holidays by making use of the Tax-free Childcare support.

With the Easter break looming, families yet to sign up for Tax-Free Childcare could be missing out on annual savings of up to £2,000 per child, or £4,000 if their child is disabled.

Tax-Free Childcare can help pay for approved childcare for children aged 11 or under, or up to 16 if the child has a disability. Parents can receive up to £500 (or £1,000 if their child is disabled) every 3 months, which means for every £8 paid into their online account, they will automatically receive an additional £2 top up from the government.

It takes just 20 minutes to apply online for a Tax-Free Childcare account and can be used to help pay for a child’s nursery, childminder, breakfast or after school club or holiday activity club. It can also be used alongside the 15 or 30 hours free childcare offer and to help pay for any specialist equipment needed for a disabled child when they’re attending childcare.

Once an account is opened, parents can deposit money immediately, so it is ready to be used whenever it is needed; and unused money in the account can be withdrawn at any time.

Families could be eligible for Tax-Free Childcare if they:

  • have a child or children aged 11 or under. They stop being eligible on 1 September after their 11th birthday. If their child has a disability, they may get up to £4,000 a year until 1 September after their 16th birthday;
  • earn, or expect to earn, at least the National Minimum Wage or Living Wage for 16 hours a week, on average;
  • each earn no more than £100,000 per annum; and
  • do not receive tax credits, Universal Credit or childcare vouchers.

A full list of the eligibility criteria is available on GOV.UK.

Eligible working parents of 2-year-olds can now register to access 15 hours free childcare per week from April 2024.

The offer will expand to 30 free hours of childcare for working parents from nine months old up to the date when their child starts school (by September 2025), and is set to save parents using the full 30 hours up to £6,900 per year.

Families can learn more about the childcare offers available to them and what could fit their family by visiting Childcare Choices.

Companies House introduces changes

Thursday, March 14th, 2024

As we have mentioned in previous posts, Companies House have been tasked with introducing a number of changes introduced by the Economic Crime and Corporate Transparency Act 2023 (ECCT Act), that came into force on Monday 4 March 2024.

Changes introduced 4th March include:

  • greater powers to query information and request supporting evidence;
  • stronger checks on company names;
  • new rules for registered office addresses (all companies must have an appropriate address at all times – they will not be able to use a PO Box as their registered office address);
  • a requirement for all companies to supply a registered email address;
  • a requirement for subscribers to confirm they’re forming a company for a lawful purpose when they incorporate, and for a company to confirm its intended future activities will be lawful on its confirmation statement;
  • greater powers to tackle and remove factually inaccurate information; and
  • the ability to share data with other government departments and law enforcement agencies.

New criminal offences and civil penalties will complement the measures introduced.

Companies House have confirmed that they will now be making their priority the cleansing of the register to remove details of those appointed without consent.

Companies House CEO Louise Smyth said:

“These new and enhanced powers are the most significant change for Companies House in our 180-year history.

“We’ve known for some time that criminals have misused UK companies to commit fraud, money laundering and other forms of economic crime.

“As we start to crack down on abuse of the register, we are prioritising cases where people’s names and addresses have been used without their consent. It will now be much quicker and easier to report and remove personal information that has been misused.”

As further changes mandated by the ECCT Act are introduced later this year we will post details on this blog.

Impact of the Spring Budget 2024

Tuesday, March 12th, 2024

We all knew that the Chancellor would have restricted options when considering the contents of his recent spring budget announcement on 6 March. But it seems he has the skills after all to “play tennis” with his arms tied behind his back…

Would there be a combination of tax cuts and public expenditure cuts, or would he go for broke and flex his fiscal rules to place the UK economy in a more expansive position?

Rather than relisting what he actually offered we have summarised below a few of the areas that will have the most impact on small businesses and individuals in the coming 2024-25 tax year.

Key dates

The VAT registration threshold is to increase to £90,000 from 1 April 2024, while the National Insurance reduction and increase in HICBC threshold take effect from 6 April 2024. The cut in the top rate of residential capital gains tax applies from the same date. The abolition of the Furnished Holiday Lettings (FHL) regime and the replacement of the remittance basis rules take effect from April 2025.


This note highlights some of the key changes.


Further National Insurance cuts

Following on from the National Insurance cuts announced at the time of the 2023 Autumn Statement, the Chancellor announced that the main primary Class 1 rate would fall to 8% from 6 April 2024. The rate was previously cut from 12% to 10% with effect from 6 January 2024. The further 2% cut will reduce the amount of Class 1 National Insurance payable by employees in 2024/25 by £754.

The self-employed are also to benefit from National Insurance cuts. At the time of the Autumn 2023 Statement, the Chancellor announced that the main Class 4 rate was to be cut from 9% to 8% from 6 April 2024. However, this is to be cut by a further 2% to 6% from 6 April 2024. This too will be worth up to £754 in 2024/25.

At the time of the 2023 Autumn Statement, the Chancellor announced that Class 2 National Insurance contributions are to be abolished from 6 April 2024. The Government are to consult later in the year on how this will be delivered.

Abolition of the FHL regime

Furnished holiday letting (FHLs) enjoy tax advantages which are not available to landlords letting residential property on long-term lets. These include the ability to deduct interest and finance costs in full when calculating the taxable profit and access to capital gains tax rollover relief and business asset disposal relief.


To address concerns as to the lack of residential property in tourist hot spots, the FHL regime is to be abolished from 6 April 2025. Draft legislation will be published for consultation. This will include anti-forestalling measures to prevent the use of unconditional contracts to secure capital gains tax relief under the existing FHL rules. The anti-forestalling measures will apply from 6 March 2024.


Reduction in top rate of capital gains tax on residential gains

Currently, chargeable gains on residential property are charged at a rate of 28% where income and gains exceed the basic rate band (set at £37,700). This is to fall to 24% from 6 April 2024. The lower residential rate will remain at 18% where chargeable gains on residential property fall within the basic rate band.

Where the conditions for business asset disposal relief were met, gains on the disposal of a FHL which were not rolled over were taxed at 10%.

Increase in the VAT registration threshold

The VAT registration threshold is to rise from £85,000 to £90,000 with effect from 1 April 2024. The VAT de-registration threshold will rise from £83,000 to £88,000 from the same date.

High Income Child Benefit Charge

The High Income Child Benefit Charge (HICBC) claws back child income where the claimant or their partner have adjusted net income of £50,000 or more. The charge is equal to 1% of the child benefit for the tax year for every £100 by which adjusted net income exceeds £50,000. Once income reaches £60,000, the charge is equal to the full amount of the child benefit for the year.

The thresholds are increased and the claw back rates are reduced from 6 April 2024.

For the 2024/25 tax year, the abatement threshold is increased from £50,000 to £60,000. Once adjusted net income exceeds £60,000, the HICBC is equal to 1% of child benefit paid for every £200 by which adjusted net income exceeds £60,000. Once adjusted net income reaches £80,000, the charge will be equal to the child benefit for the 2024/25 tax year.

The HICBC is a complicated charge with a number of anomalies. Currently, a couple where both partners have adjusted net income of £49,999 (total combined income of £99,998) are able to keep their child benefit in full, whereas a couple where one partner has no income and the other has income of £60,000 will effectively lose all their child benefit in the form of the HICBC. To address this, the HICBC will be based on household income from April 2026.


Abolition non-UK domicile tax regime

The remittance basis tax regime for non-UK domiciled individuals who are resident in the UK allows them to be taxed only on foreign source income and gains if they are remitted to the UK in return for paying a remittance basis charge. The charge depends on how many years they have been resident in the UK for tax purposes. Once a person has been resident for 15 of the previous 20 tax years, they are deemed to be UK-domiciled and taxed in the UK on all their worldwide income.

The remittance basis rules are to be abolished from April 2025 and replaced by a simpler residence-based regime. Individuals who opt into that regime will not pay any tax on foreign income for the first four years in which they are resident in the UK as long as they have not been resident for the last ten tax years. Transitional arrangements will apply.

Overseas Workday Relief (OWR) is also to be reformed and eligible employees will be able to claim it for the first three years of tax residency.

The Government are also to consult on moving to a residence-based regime for inheritance tax.

British ISA

The Government are to introduce a British ISA with a separate £5,000 limit in addition to the usual ISA limit of £20,000. They will consult on the details at a later date.


Fuel duty rates will remain frozen for a further 12 months until March 2025, while alcohol duty rates will remain frozen until 1 February 2025.

A new duty on vaping products is to be introduced and will apply from 1 October 2026. Rises in tobacco duty will take effect from the same date. 

Air passenger duty for flights other than economy flights is to increase from 1 April 2025.


Please call if you need help with any of the issues raised in this alert.

Tax Diary March/April 2024

Monday, March 11th, 2024

1 March 2024 – Due date for Corporation Tax due for the year ended 31 May 2023.

2 March 2024 – Self-Assessment tax for 2022-23 paid after this date will incur a 5% surcharge unless liabilities are cleared by 1 April 2024, or an agreement has been reached with HMRC under their time to pay facility by the same date.

19 March 2024 – PAYE and NIC deductions due for month ended 5 March 2024 (If you pay your tax electronically the due date is 22 March 2024).

19 March 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 March 2024.

19 March 2024 – CIS tax deducted for the month ended 5 March 2024 is payable by today.

1 April 2024 – Due date for corporation tax due for the year ended 30 June 2023.

19 April 2024 – PAYE and NIC deductions due for month ended 5 April 2024. (If you pay your tax electronically the due date is 22 April 2024).

19 April 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 April 2024.

19 April 2024 – CIS tax deducted for the month ended 5 April 2024 is payable by today.

30 April 2024 – 2022-23 tax returns filed after this date will be subject to an additional £10 per day late filing penalty for a maximum of 90 days.

File early to have self-assessment tax coded out

Monday, March 11th, 2024

The coding out threshold may entitle you to have tax underpayments collected via your tax code when you are in employment or in receipt of a company pension. Instead of paying off debts in a lump sum, money is collected in equal monthly instalments over the tax year.

If you want to benefit from this opportunity to pay tax due on 31 January through your tax code, then you need to file early. The deadline for the 2022-23 tax year has already passed.

You can pay your self-assessment bill through your PAYE tax code as long as all these apply:

  • you owe less than £3,000 on your tax bill (you cannot make a part payment to meet this threshold);
  • you already pay tax through PAYE, for example you’re an employee or you get a company pension; and
  • you submitted your paper tax return by 31 October or your online tax return online by 30 December.

HMRC will automatically collect what you owe through your tax code if you meet these three conditions unless you have specifically asked them not to (on your tax return). There are circumstances when HMRC will not collect the monies through your tax code, for example, if you do not have enough PAYE income to cover he debt.

If you would like to consider paying your self-assessment bill in this way for the 2023-24 tax year, you have until 30 December 2024 to file your online self-assessment returns to have the monies collected in the 2025-26 tax year starting on 6 April 2025. If you qualify to have your tax debt coded out then this is a good reason to deal with your tax return obligations as soon as you can, after the end of the relevant tax year.

Reporting employee changes to HMRC

Monday, March 11th, 2024

There are rules that businesses must follow when they are reporting employee changes. These changes must be sent to HMRC using a Full Payment Submission (FPS). The FPS is a submission that is required every time you pay your employees and must be submitted on or before the usual date you pay your employees. The information provided on an FPS helps HMRC ensure that they have the up-to-date information on your employees.

Additional information is required on your FPS if:

  • it includes a new employee
  • an employee leaves
  • you start paying someone a workplace pension
  • it’s the last report of the tax year
  • an employee changes their address

You may also need to tell HMRC if an employee:

  • becomes a director
  • reaches State Pension age
  • goes to work abroad
  • goes on jury service
  • dies
  • joins or leaves a contracted-out company pension
  • turns 16
  • is called up as a reservist
  • changes gender

Eligibility for the VAT Flat Rate Scheme

Monday, March 11th, 2024

The VAT Flat Rate scheme is open to VAT registered businesses that expect their taxable turnover in the next 12 months to be no more than £150,000, excluding VAT. The annual taxable turnover limit is the total of everything that a business sells during the year that is not VAT exempt.

Under the scheme rules, businesses pay VAT as a fixed percentage of their VAT inclusive turnover. The actual percentage used depends on the type of business. There is a special 1% discount for businesses in their first year of VAT registration.

If any of the following apply, you will not be eligible to join the scheme:

  • you left the scheme in the last 12 months;
  • you committed a VAT offence in the last 12 months, for example VAT evasion;
  • you joined (or were eligible to join) a VAT group in the last 24 months;
  • you registered for VAT as a business division in the last 24 months;
  • your business is closely associated with another business;
  • you’ve joined a margin or capital goods VAT scheme; or
  • you are using the Cash Accounting Scheme.

Once you join the scheme you can usually continue using it provided your total business income does not exceed, or you do not expect it to exceed, £230,000 (including VAT) in a 12-month period. You must also leave the scheme if you expect your total income in the next 30 days alone to be more than £230,000 (including VAT). There are special rules if the increased turnover is temporary.

If you think that the scheme may be beneficial for your business, please get in touch and we can help you consider your options.