News

Small businesses are missing out on the benefits of apprenticeships, a new report has suggested.

According to a survey from Barclays, small firms with a turnover of less than £5 million are lagging behind their larger counterparts when it comes to creating apprenticeships.

Just 19 per cent of small companies are likely to take on an apprentice, compared with an average of 41 per cent among businesses of every other size.

The poll also found that only 12 per cent of the smallest firms are planning to increase the amount of apprentices they recruit this year, compared with 19 per cent of all other company sizes.

A recent report from the Centre for Economics and Business Research found that firms with apprentices usually gain a £241 per week productivity boost.

Ashok Vaswani, chief executive of Barclays Retail and Business Banking, said, “It’s encouraging to see that many companies are planning  to take on more apprentices in 2013, but with small business accounting for around half of the UK’s GDP it is really important that they do not miss out on the benefits that apprentices bring to organisations of all sizes.”

The free software provided to small businesses by HM Revenue & Customs is failing to file real-time PAYE submissions. The Basic PAYE Tools (BPT)software package is available to employers with nine or fewer employees, and is designed to work out tax and national insurance contributions for each payroll cycle, and report it to the taxman in real-time.

However, a software issue has seen an error message appear when employers attempt to make PAYE submissions, while taxpayers calling the RTI helpline were met with a recorded message acknowledging the fault and assuring them the issue was being investigated.

An element of Windows, known as a registry key, has been removed in a Windows update. The key is needed to enable full function of the software. Without its presence, the software is unable to successfully submit the information.

HMRC has published guidence advising users that although information about restoring the key is available from various sources online, HMRC itself cannot provide instruction on how to, as it is unsure why the key was removed.

The taxman will, however, release a software update at the end of May negating the need for the key. In the meantime, taxpayers are advised to continue running the payroll system as normal and submit the information once the update has been installed.

A spokesman for HMRC said “The roll out of RTI is progressing well. Since 6 April over one million PAYE schemes have successfully started to report PAYE in real-time. This includes over £140,000 BPT users successfully submiting returns”.

“As with any major change, a few initial problems have been identified and these are being resolved quickly. The issue referred here is not BPT fault, but we have published guidance to help those employers affected to resolve it. The vast majority of BPT users who have already started to report PAYE in real-time are successfully submitting returns without any issue.”

For information on the guidance HMRC published, click on the link below.

http://www.accountancyage.com/aa/news/2267021/hmrc-rti-software-fails-to-file-submissions

You may be liable to the High Income Child Benefit charge if you, or your partner, have an individual income of more than £50,000 and one of you gets Child Benefit. It may also apply if someone else receives Child Benefit for a child who lives with you.

The link below will provide you with more information, however, if you do have any queries please contact us.

The High Income Child Benefit charge

For Many Years, HM Revenue & Customs (HMRC) has put extra resources into pursuing more tax. As a result, clients face an increased risk of an enquiry into their tax affairs. In addition, HMRC now has wider powers to visit premises and inspect financial records. It is expected that HMRC will use these powers frequently, that enquiries will become more complex and that the costs of responding will increase. So it is important as it has ever been for clients to obtain protection against those costs.

We have considerable expertise in defending clients under enquiry by HMRC. If you are selected for a tax enquiry, we will aim to settle it quickly and minimise the final tax liabilities. Even so, answering all of HMRC’s questions takes time and the enquiry could drag on for months. It can cost thousands of pounds to defend you, whatever the end result.

To provide peace of mind, we offer a Tax Enquiry Fee Protection Service. The service is backed by an insurable policy under which we can claim the costs of defending clients in tax enquiries. Clients who subscribe to the service will also be able to obtain helpful advice about the complex areas of Health & Safety and Employment Law.

The links below answer questions you may have about tax enquiries, sets out details of our insurance cover and other benefits, and gives information about our insurance provider.

Further information            Frequently asked questions

A quick summary of the main points to come of the 2013 budget:

  • Date set for increase in the personal allowance to £10,000.
  • New scheme for tax free childcare.
  • Further reduction in the main rate of corporation tax to 20% from 1st April 2015.
  • Employee-shareholder contracts will be exempt from income tax and NIC for the first £2,000 of shares received.
  • The introduction of an allowance of £2,000 per year for all businesses and charities to be offset against their employer Class 1 NIC liability from April 2014.
  • A capital gains tax re-investment relief for gains made in the tax year 2013/14 where the gain is invested in Seed Enterprise Investment Scheme shares.
  • Significant non-tax measures have been announced to tackle long term problems in the housing market and are covered in the Other Matters section of this summary.

2013 Budget Summary

A quick summary of the main points to come out of the 2012 Budget:

  • The Income Tax basic personal allowance is to be increased to £9,205 in 2013/14, and the higher rate threshold reduced by £1,025 to £41,450. 2012/13 basic personal allowance is £8,105.
  • Age allowance to be frozen from 2013/14 and then phased out
  • Additional rate of income tax reduced to 45% from 2013/14
  • 7% Stamp Duty Land Tax to be brought in for residential properties valued at over £2million and new measures to counter ownership through companies
  • Child benefit will be phased out where income is over £50,000
  • The main rate of Corporation Tax is being cut to 24% from April 2012 and to 22% by April 2014
  • Voluntary cash basis to be based on turnover for tax on profits of small unincorporated businesses.

The basic points to come out of the 2011 Budget were as follows:

-The individual personal allowance for 2011/12 will be £7,475 representing an increase of £1,000 each as previously announced.
-For 2012/13 this will increase by a further £630 to £8,105.
-The 40% band will start at the lower level though of £42,475 this year and 50% will be charged on income over £150,000!
-The lower rate of corporation tax is being reduced to 20% (applicable on profits below £300,000)
-Full rate of corporation tax is reduced by 2% to 26% this year, and will fall by a further 1% p.a. over the next 3 years
-Lifetime limit for Entrepreneurs’ Relief for capital gains tax on the disposal of business assets is increased from £5 million to £10 million.
-R&D tax credit for small and medium sized enterprises will be increased to 200% from April 2011 and to 225% a year later.
-The main rates of National Insurance will increase by 1% from 6/4/11 as previously announced. The primary threshold for employers NI will be £139 per week, and the secondary threshold will become £136 a week. Employees will not pay NI on earnings below £139 per week.
-From April 2011 losses on furnished holiday lettings will only be offset against income from the same business and so cease to be treated as trading losses allowable against other earned income.
Approved mileage rates which employers can pay employees is increased to 45p per mile (from 40p) for the first 10,000 miles. The excess over 10,000 p.a. will still be at 25p per mile.
-Capital Gains annual exemption increases to £10,600.
-VAT registration threshold will increase from £70,000 to £73,000 from 1/4/11.