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GDPR - Preparing Your Business

3/23/2018

With some high profile losses of data in recent years, it should come as no surprise that businesses would be subject to more stringent data protection regulations that reflect the internet based world we operate in.

Changes come into force on the 25th of May which will change the way we process and handle personal data and how we contact our customers. Its fair to say that most businesses will handle sort of personal data.

It’s absolutely vital that if you handle personal data, e.g. financial records, medical records, customer data, employee data, supplier data or even if you send out a marketing Email that you familiarise yourself with it and act before it’s too late. There’s a really useful checklist on the attached link:

https://ico.org.uk/media/1624219/preparing-for-the-gdpr-12-steps.pdf

Every business should check if it is handling any sort of personal data and make sure it takes the necessary action.

I will be making some changes to how the practice deals with clients including a new file exchange system to avoid the need for Email attachments - this will have the added benefit of E signing of tax returns.

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2018 - Three Useful Tax Reliefs

3/23/2018

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As we approach the end of the tax year, It’s worth reminding you of some useful reliefs to enable you to consider if you owe any tax or indeed need to complete a tax return.

Property Allowance – £1,000
Trading Allowance - £1,000
Rent a room relief - £7,500

Property and Trading Allowance - Where the £1,000 allowances cover all of the income (no expenses are ever allowed) then you don’t need to declare it. In the case of these being your only other source of income it means you don’t need to do a tax return anymore.

So for example, you’re a teacher and you do some tuition earning £15 a week then previously you should have completed a tax return and provided you don’t have any income other that your PAYE salary then you probably don’t need to do a tax return. There is quite a bit more to this particularly where people have a main sole trade and a ‘hobby business’ and the detail can be found on the following link:
https://www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income

The Rent a Room Scheme lets you earn up to a threshold of £7,500 per year tax-free from letting out furnished accommodation in your home. This is halved if you share the income with your partner or someone else. You can let out as much of your home as you want. If income falls below this limit (as with the above reliefs, you can’t deduct costs), then the relief is automatic and provided there is no other reason to complete a tax return, you don’t need to do one.

https://www.gov.uk/rent-room-in-your-home/the-rent-a-room-scheme

Since the rise in popularity of websites such as Air B&B, HMRC have been consulting on whether rent a room is fit for purpose. The upshot is, we’re likely to see some sort of ‘residence’ test with casual B&B type arrangements either being treated as a trade or being subject to the much tighter £1,000 property income allowance.

As a reminder if you need to complete a tax return you must register by 5th October to be sure to avoid a penalty. It’s important to note that if you do need to complete a tax return and fail to do one, HMRC ‘not sending you one’ is not considered a reasonable excuse if you are subject to a compliance check.

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Employing People - 2018 Things to Note

3/23/2018

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Photo by Marten Bjork on Unsplash

There might not have been a budget in March, but lots is changing on the employment front.

National Minimum (NMW) and Living Wages will increase from 1 April 2018. The changes are as follows:

Age Group

National Living Wage (25+)
NMW (21-24)
NMW (18-20)
NMW (16-17)

April 2017

£7.50 p.h.
£7.05 p.h.
£5.60 p.h.
£4.05 p.h.

April 2018

£7.83 p.h.
£7.38 p.h.
£5.90 p.h.
£4.20 p.h.

It’s important to note that the change is 1 April and not 6th April so wages and salaries change before the end of the tax year. There have been some high profile ‘naming and shaming’ with resultant fines so it’s important to make sure you’re on top of this as you’ll not only have to pay the back pay but you could also be ‘named and shamed’ and be subject to a fine.

With increases over the rate of inflation, its also really important that you also check to see if an employee needs to be taken into a pension scheme as the £10,000 trigger remains unchanged which means more people are likely to qualify. More detail can be found here:

http://www.thepensionsregulator.gov.uk/automatic-enrolment-earnings-threshold.aspx

April also marks the first time that minimum pension contributions will rise, so it’s important your payroll software or payroll provider is on board. You’ll also note that you need to budget more for pension contributions. More information can be found on the link below:

http://www.thepensionsregulator.gov.uk/doc-library/increases-in-minimum-contributions-automatic-enrolment.aspx

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Photo from Ivan Radic

GDPR - Preparing Your Business

2018 - Three Useful Tax Reliefs

Employing People - 2018 Things to Note

Nigel Gorski

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