6 Working Weeks until April 5th

April 5th 2019 is now only 6 working weeks away and as happens every year this is a crucial date in the accounting diary as it is the end of the tax year and the date that the Chancellor’s budget changes happen.

Typically payroll is the critical area that needs careful attention as you will be issuing P60 pay and tax records for each employee and on April 6th implementing new tax rates and any other changes HMRC are bringing into force.

The company’s full payment submission is part of the HMRC Real Time Information requirement and must be submitted by 5th April 2019 or you may be fined up to £100 penalty for each month of delay.

Income and Tax Brackets

For the 2018/19 tax year the basic rate of pay was £11,850, for the next tax year 2019/20, it becomes £12,500. The 20% tax ceiling raises from £34,500 to £37,500 and the higher rate tax band is narrowed by £3,000 because the higher threshold remains at £150,00. Income above £150k is unchanged and is taxed at 45% tax rate.

National Insurance

There are no changes to the percentage of National Insurance Class 1 contributions, they remain at 12% for employees, and 2% above the upper earnings limit.

These are just a few of the major points that will impact most employees, for a full list of tax thresholds, rates and codes please refer to the UK Government website here.

If you have employees based in different areas of the UK, tax rates in Scotland will be different to those in England and Wales due to devolution of tax powers to each country’s parliament or governing body.

Company Dividends

Another important area for business owners is to ensure any company dividends are issued and paid by April 5th. This will then allow them to be included in their personal self-assessment tax return and maximise their tax efficiency by utilising any tax free allowances and HMRC tax thresholds.

All records need to be fully up-to-date when issuing dividends as this will allow you to calculate the company’s profit and any tax due the Government.

Pension Contributions

As with Dividends, any pension contributions you are making should be sent to your pension provider by 5th April, you have a tax free limit of £40,000.

Tax Year End

Many businesses also choose the 31st March as their company year-end and this adds to the many tasks that you need to have complete. If you are new in business or have become much busier than previous years then why not talk to us? MCC Accountants can help you maximise your tax efficiency and assist you with all of the many statutory tasks that need completing.

Please get in touch using the details on our contact page. We are a local accountant based in Salford and have helped many SMEs over the last 10 years.

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