As we fast approach the January 31st Personal Tax deadline, here’s a reminder of what you need to do with regards to your personal tax obligations.
Do I need to submit a personal tax return?
If your total personal income takes you into the higher rate tax bracket (this means your income exceeds £41,865 for the tax year 2013/2014 (6th April 2013- 5th April 2014) you will have a personal tax liability to pay by January 31st 2015. This is separate and in addition to your company tax liabilities.
Personal income includes salary and dividends from your Ltd Company as well as any income out-with the company such as rental income, pension Income, savings interest or any other income you may have.
When is my personal tax liability payment due?
Any personal tax liability must be paid by you personally, to HMRC by 31st January 2015. If you opt to pay the liability using funds held in your company, you should advise your Account Manager whether you wish for this transaction to be classified in the accounts as either a dividend or directors loan.
What are payments on account?
If your personal tax liability is greater than £1,000, HMRC require you to make “payments on account”. You are required to make 2 payments on account within the current year. These payments on account equate to one half of your 2013/2014 personal tax liability, and are paid in January and again in July.
The payments made go towards your following year’s personal tax liability. Please note, if what has been paid leaves an amount against what is due, a balancing payment will be required. If you require any further information on how to make the payment, please contact your Account Manager.
Chancellor announces that IR35 reform will be scrapped
IR35 reform in both the private and public sectors is to be repealed, the Chancellor announced in the mini Budget, held on Friday 23rd September.
This surprise development made up just one of many welcome tax changes, as Liz Truss’s new-look government promised to start “a new era” and unleash the potential of UK business.
Why is accounting for a start-up business important?
Why do some start-ups succeed while others are doomed to fail?
It’s an often-quoted statistic that around 60% of businesses fail in their first three years – with 20% folding within just twelve months.
Why freelancers should hire an accountant
In the world of work, freelancing is an increasingly popular option. The promise of flexibility, unlimited earning potential and complete control over the way you work is a hugely attractive prospect for many.