Welcome to BPU's 2019 Spring Newsletter
BPU Staff News
Fourteen BPU Staff Sign Up for Cardiff 10K to Raise £5,000 for local Charities
BPU staff have again signed up to the Cardiff 10K and are aiming to raise £5,000 for various local charities this year. Fourteen BPU staff will run on 1st September 2019 to raise funds for Wales Kidney Foundation. BPU is supporting the Kidney Wales Foundation for the help and support friends and colleagues of the staff have received from the charity.
Staff in the office are training hard, swapping cakes for fruit, running at lunchtime and setting weekly goals. Some staff have never run a race like this before but are determined to go from the couch to running 10K by September.
BPU Accounts Assistant, Joanna Thomas is running the race for the first time said: "I would never have signed up for a race like this on my own but by training with my colleagues and spurring each other on, I know we are all going to be able to hit the target and complete the race. There is a really good atmosphere in the office and we are supporting each other to stay healthy and train when we can. I just hope I will make it to the finish line!"
Some of the BPU runners last year.
If you would like to sponsor us for the Cardiff 10K please donate at Just Giving: https://www.justgiving.com/fundraising/bpu-cardiff10k
The firm will be holding a number of fundraising events this year to help hit an annual target of £5,000 for local charities. We will keep you up to date on events coming up as well as progress on our overall target. Wish us luck - come on team BPU!
BPU Invest in Ten Trainees
Ten BPU staff are currently studying for qualifications through various BPU funded training schemes. BPU believes in training the accountants and tax advisors of the future and growing a strong technical team.
Stefan Dakovic and Joanna Thomas are working towards their AAT qualification in book-keeping through the Welsh Governments Apprentice Scheme. They have both been working hard and flying through their exams, Joanna recently got 100% in her Control Accounts exam. James Verdon is in his final year of this apprenticeship and due to qualify later this year.
Six BPU staff are studying to become qualified Chartered Accountants (ACA) on BPU's graduate three year training programme. Lois Jones and Emily Wu are about to complete year one, Alex Mitchell and Sam Smith are completing year 2. Charlotte Winterbourn and Katie Hawker are studying hard for their third year final exams and hope to qualify as Chartered Accountants this summer. Once qualified both Katie and Charlotte have been offered full time accountancy positions at BPU which will start this autumn.
BPU is also growing its tax department, Kieran Newton is working towards his ATT qualification having previously completed an AAT in book-keeping and Ashley Wareham has just qualified as a Chartered Certified Accountant and is now working towards his Chartered Tax Advisor (CTA) qualification.
Recruited on the BPU graduate programme 15 years ago, Chartered Accountant Andrew Miller is now a director at BPU, he said: “We are committed to finding and investing in people to help expand the skill set of our team. We are already in the process of recruiting for our Graduate Programme again this year.”
BPU trainees above - Good luck in your exams this summer !
Easter Egg Donation
Well done to the BPU team for donating a record number of Easter eggs to the children at Ty Hafan this year - an amazing cause that we are proud to support.
Eggcellent work BPU!
Making Tax Digital - The Latest
Are you using old versions of Sage or Excel that don’t comply with the new Making Tax Digital Rules?
Don’t Panic! – Our Dawn Bevan has a solution.
If you are VAT registered with a turnover above £85,000 and are using an old version of sage, excel or handwritten spreadsheets to keep your financial records you will not be able to file VAT returns via the HMRC gateway from 1st April 2019.
The first quarterly VAT return to be filed under Making Tax Digital (MTD) is 30 June 2019 (i.e the first VAT return period commencing on or after 1 April 2019) or 30 April 2019 if you file monthly VAT returns. If you keep your VAT records on Excel or are using a Sage desktop copy this is not compatible with MTD.
Instead of paying for an upgrade to file your return directly through the software we have been advising clients to generate their Sage VAT return report as an Excel compatible(CSV) file, you can either send a CSV file to us and we will file your VAT returns for you at a cost of £75 plus VAT per quarter or you can use an API (Application Programming Interface) to send the figures to HMRC yourself.
The API generates a CSV file with the 9 boxes that HMRC requires to be completed. Each of these boxes needs to be linked to the relevant cell on your Excel spreadsheet and you can then submit the figures through the API. It is a common misconception that HMRC will require the detailed transactions behind these figures, but all they require is a digital link ( i.e. linking cells in a spreadsheet) rather than manually entering a figure which will not be allowed under MTD.
At BPU Chartered Accountants we are able to offer our clients an API solution at a small cost of £30 plus VAT per year. It takes just minutes to file the return and we have a written procedure to help you use it for the first time.
As soon as you've filed your last VAT return before the 1 April 2019 via the Gateway, we are recommending that clients register for an MTD User ID (via the link on your Gateway account) as it takes time to set up. If you pay your VAT by direct debit, HMRC requires this account to be set up 15 days before the VAT due date.
If you are using an accounts software package to file your VAT returns, there are certain things you will need to do to ensure it is set up correctly to deal with MTD.
To file your VAT return through SAGEOne or Quickbooks you will need to authenticate the MTD option already included in your package. Once you have opted in to do this you are unable to opt out and this needs to be done at the right time depending on when your VAT return is due. If you need help with this please contact us.
Xero has an MTD module included, however, we are advising clients that this needs to be activated and requires your new MTD account ID and credentials to ensure it can operate through MTD. BPU are a certified partner for Xero so contact us for further advice.
We can help you with all of the above, software upgrades and training for Xero, Quickbooks, and Sage as well as a full MTD Book-keeping & VAT Return Filing Service.
For further advice on any of the above or for a free MTD consultation please contact me.
Dawn Bevan, Senior Manager
Martin Knight, BPU Director
Taking a look at the measures for 2019/20
The beginning of the 2019/20 tax year ushers in a handful of changes to tax and business legislation. Here, we outline some of the key measures to take note of.
Rising Minimum Wage
From 1 April 2019, the National Minimum Wage (NMW) and the National Living Wage (NLW) rates increased, the new hourly rates of pay are as follows:
||National Minimum Wage
||National Living Wage
|16 and 17
|18 - 20
|21 - 24
|25 and over
*Under 19, or 19 and over in the first year of their apprenticeship.
Additionally, in the 2019 Spring Statement, Chancellor Philip Hammond announced that Professor Arindrajit Dube will undertake a review of the latest international evidence on the impact of minimum wages, to inform future NLW policy after 2020.
Alterations to Income Tax
For this tax year 2019/20, the income tax basic rate band increased to £37,500. Consequently, the threshold at which the 40% band applies is £50,000 for taxpayers who are entitled to the full personal allowance (PA). Individuals pay tax at 45% on their income over £150,000.
From April 2019, the PA was increased from £11,850 to £12,500. Where an individual's 'adjusted net income' exceeds £125,000 in 2019/20, no PA is available.
The Welsh government now have the power to vary the rates of income tax payable by Welsh taxpayers. The Welsh rate of income tax was set at 10p on the 1st April 2019 by the Welsh government: this will be added to the reduced rates. As a result, the tax payable by Welsh taxpayers continues to be the same as that payable by English and Northern Irish taxpayers.
Changes to Employer Provided Cars
The scale of charges for working out the taxable benefit for an employee who has use of an employer-provided car is normally announced well in advance. Most cars are taxed by reference to bands of CO2 emissions, multiplied by the original list price of the vehicle. The maximum charge is capped at 37% of the list price of the car.
For 2018/19 there was generally a 2% increase in the percentage applied by each band. For 2019/20 the rates increased by a further 3%.
Rising Residence Nil-Rate Band
The inheritance tax Residence Nil-Rate Band (RNRB), which was introduced in April 2017, rose from £125,000 in 2018/19 to £150,000 for the 2019/20 tax year. The RNRB is designed to enable a 'family home' to be passed wholly or partially tax-free on death to direct descendants, such as children or grandchildren. It will increase to £175,000 in 2020/21. Thereafter it will rise in line with the Consumer Price Index.
Increase in Compulsory Employer Pension Contributions
As part of the pensions auto-enrolment scheme, employers were required to contribute at least 2% on the qualifying pensionable earnings for eligible jobholders. From 6 April 2019, this figure has increased to 3%.
Alterations to the Gift Aid Small Donations Scheme
Where small charitable donations are made, and it is impractical to obtain a Gift Aid declaration, individuals may choose to make use of the Gift Aid Small Donations Scheme (GASDS). The scheme currently applies to donations of £20 or less made by individuals in cash or contactless payments. From 6 April 2019, this limit increased to £30.
Tax Efficient Remuneration for 2019/20
In April 2019, HMRC updated and changed their tax rates and allowances. For clients who complete their own payroll you may want to consider the way you pay yourself in-line with these changes.
By adjusting your salary and dividends you can make full use of the tax free allowances available. Before you decide the level of salary you should pay yourself there are number of factors you may need to consider, such as:
- Structure of the business and how the company is set up,employees / sole directors etc.
- National Insurance Thresholds (if you are not claiming EA you should stay within the primary threshold of £166 to avoid paying 13.8% NIC on salaries paid)
- Child benefit and if this may take you into the next tax band
- Pension contributions and how this effects your income
With so many factors to consider I would be happy to speak with you if you would like to discuss any of the above in more detail and what the best options are for you and your business.
If you would like any further advice regarding any of these topics please contact:
Martin Knight, Head of Tax at BPU Chartered Accountants
Tel: 029 2073 4100
Next Tax Deadline
6th July 2019 - Deadline for submission of 2018/19 P11D forms
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