Taxfile Partners with Local Government to Offer Self Assessment Assistance

With the self-assessment tax deadline looming in the midst of a global pandemic and no announcement of an extension from the government (28 days would do), 5.4m* taxpayers (45%) still needing to submit a tax return before the 31st January and many of those are left feeling hopeless and helpless, unsure how to complete it themselves and having difficulty finding or affording an accountant who can do it on their behalf.

Some will attempt to complete the tax return online themselves but without a Government Gateway ID that task will be impossible.  Obtaining the Government Gateway ID would require having their ID checked and confirmed online and without a valid UK passport and/or driving licence the task will lead to long phone calls on hold waiting for a HMRC advisor, who are currently running somewhat of a skeleton crew as a result of the pandemic (at least that’s the impression given due to the long waiting times even on the authorised agents helplines and the reduced opening hours).

Even if you do have Government Gateway ID (and password), you will need to work through HMRC’s Self-Assessment form, deciding which of the sections are relevant to you & compiling the information required for each part. Take a look at these help sheets especially useful for people with self-employed earnings (some of the business income references use the word business which can confuse as the rules and guidelines are equally applicable to sole traders working for themselves).

Also check out the HMRC’s toolkit: https://www.gov.uk/government/publications/hmrc-business-profits-toolkit.

 You will need to accurately assess all your business income and more so, expenses, ensuring the correct figures are entered and submitted.  Knowing what expenses you can and can’t claim can really have a negative or positive effect on the tax bill you will be presented with at the end but how do you ensure you are paying the correct amount of tax?

 Looking for assistance from HMRC’s website can provide some valuable information if you know what you are looking for (see the help sheets mentioned above) but from the distance, for the everyday taxpayer, this task can be rather daunting.  Finding personal help, assistance, and guidance can be difficult, especially when the people that can help those most are currently experiencing their busiest period in the industry whilst coping with the effects of COVID on their workforce.

Many may opt for the avoidance strategy until the £100 late filing penalty lands on their door and further threats of daily fines & interest kicks them into action.  You will have a ground to appeal any fines or penalties if you have been affected by COVID.  This will involve writing a formal letter to HMRC and providing any evidence they may request to overturn the fine.

We do recommend that however hard it maybe, it’s a good idea to put some money on your HMRC self-assessment account to settle last year’s tax if you can at least estimate it because at the end of February any tax still outstanding from the previous year which ended 05/04/20 will attract a surcharge which is almost impossible to appeal against so give it a go and work out your taxable profit and then put it in this calculator so you can guesstimate how much you need to rustle up.

If you need an injection to your cash flow even if you were eligible and claimed for the SEISS grants, we would strongly recommend you apply for the Bounce Back Loan Scheme (BBLS) if you have not done so already.  This can be done via your bank provider online & in many cases they may require you to open a business bank account.  You are then eligible for a maximum of 25% of your 2018/19 business turnover (a minimum of £2k and maximum amount of £50k being leant).  The interest rate for this loan is 2.5% for 6-years and the government will pay the interest for the first 12-months of the loan.

Taxfile is currently working closely with local government and our director is on the board of the local business improvement district, we like to think of ourselves as the local tax office for the people of south London, we may be able to give you a little help along the way so why not give us a call for a free 20 minute confidential chat on 020 8761 8000

 

*figure correct on 01/01/21

Self Assessment Income Tax Returns 2019/20 – COVID Edition

 

To date there has been no change on the deadline to submit and pay your 2019/20 Self Assessment Income Tax return by 31st January 2021.

In preparation for our busiest period in the year we have been doing everything to ensure both our offices and business practices are ready to cope with the changes imposed on us by the Coronavirus pandemic.

At Taxfile we have been doing everything we can to make sure our offices comply by current pandemic safety practices.   We have fitted perspex screens between staff and clients, only allowing 2 clients in at a time, minimising each visit to a maximum of 15-minutes & socially distancing our staff members on site with a maximum of 3 in the main office at one time.

We would like to stress to all our existing & potential customers, we ARE OPEN if you need help in submitting your 2019/20 tax returns.  We currently offer a variety of ways to help you:

  1. Booking an appointment to see a tax agent face-to-face for 15 minutes – call us on 020 8761 8000 so we can arrange a time and date with you
  2. Offices are open for you to drop off paperwork to be processed and then sent through to a tax agent who can then discuss your return over the phone with you or face-to-face
  3. Email service where all electronic data can be sent directly through to the tax agents via emails, this is probably the easiest, quickest, and safest way to proceed.  You can directly send the agents your financial data through on email or using services such as dropbox or google sheets.  They can then calculate your return and liaise with you via phone & email.
  4. You can book an online ‘virtual’ meeting HERE

Regardless of which way or combination of ways suits your needs, know that we are here for you till the deadline date of 31/01/2021 but urge you to contact us sooner than later as we are restricted by the number of people we can physically see & data we can work through during these uncertain times.

We are also urging our clients to pay via online banking for their Taxfile invoices, details found on the bottom of our invoice, reducing the need to come in or phone in to pay a bill as we need to reduce the number of people in the office for health and safety & therefore reducing our resources available.  We are still accepting all payment forms but if clients CAN pay via online banking, then we are encouraging them to do so.

If you have not submitted your 2019/20 tax return (that in most cases will run from 6th April 2019 through to 5th April 2020), then now is the time to get all your financial data together, and decide which of the four methods outlined above will be most convenient for you.  Get in touch now & don’t leave it till the last minute.  This year is like no other!

Taxfile Partners with Vantage Tax Fee Protection

Great news for ALL Taxfile clients!

We are proud to announce that we have partnered with Vantage Tax Fee Protection, a market leading insurance company that will protect all of our clients from any HMRC investigations for tax returns submitted by us.

You are protected as a result of:

  • Corporation Tax and Income Tax full or aspect enquiries
  • PAYE/NIC compliance checks from the outset and disputes with HMRC following such checks
  • CIS enquiries and disputes
  • VAT compliance checks from the outset and disputes with HMRC following such checks
  • Enquiries under Section 60 or 61 of the VAT Act 1994 (provided there is no dishonesty or fraud)
  • Business record checks, inspections and interventions under HMRC’s Information & Inspection Powers at Schedule 36 FA 2008… & more.

Most accountants would charge you a considerable sum for such a leading standard of protection but at Taxfile we will spread the cost through the business on each tax return submitted and as a result the additional cost is a fraction of what would be paid individually by you or your business.

The protection will only add (exclusive of VAT):

  • £5 on a self assessment income tax return
  • £10 on a VAT return
  • £25 on a corporation tax return
  • £4 on a payroll submission

I think you will agree with us, a very small price to pay for peace of mind.

SEISS Grant – Round 3

Instead of constantly updating our original SEISS grant post we decided to create a new one as over the last month the government has chopped and changed the requirements, the dates, & the amount available due to the everchanging situation around the COVID-19 pandemic.

The points that need to be highlighted for the third extension of the SEISS grant are:

  • The prerequisite is the same as the previous two SEISS grants (changing from a prerequisite to be working if applying).
  • The amount is 80% for 3-months determined from your average trading profits like in the 1st SEISS grant application (changing from 20%, then 40%, then 80% for November & 40% for December and January)
  • Applications will open from 30/11 and will most probably follow suit of the two other applications, in that using your UTR & NI number you will then be given a date/time you can apply (changing from applications opening on 14/12/20).

If you need any help determining your application date or with the application then please call us on or after 30/11 on 020 8761 8000.

Self-Employment Income Support Scheme (SEISS) Deadlines and Extensions

The deadline for the 2nd SEISS grant looms, please apply before it is too late.

The second SEISS grant is worth 70% of your average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £6,570 in total.

If you’re eligible and your business has been adversely affected on or after 14 July 2020, you must make your claim for the second grant on or before 19th October 2020.

That is less than 10-days from now.  If you need help making your claim or are unsure, please call us on 020 8761 8000.

The SEISS grants have been extended for 2 further payments but with a new prerequisite.

The scheme has been extended for a 3rd and 4th grant for those that are actively continuing to trade, but are facing reduced demand due to the coronavirus pandemic.

To be eligible for the grant extension self-employed individuals, including members of partnerships, must:

  • currently be eligible for the Self-Employment Income Support Scheme (although they do not have to have claimed the previous grants)
  • declare that they are currently actively trading and intend to continue to trade
  • declare that they are impacted by reduced demand due to coronavirus in the qualifying period (the qualifying period for the grant extension is between 1 November and the date of claim)

The extension will provide two grants and will last for six months, from November 2020 to April 2021. Grants will be paid in two lump sum instalments each covering a three-month period.

The third grant will cover a three-month period from 1st November 2020 until the end of January 2021.  This grant will only be 20% of your average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £1,875 in total.

The fourth grant will cover a three-month period from the start of February until the end of April.

HMRC will review the level of this grant and set it in due course as its value will be dependent on how the pandemic has affected the workforce in February 2021.

All the SEISS grants are subject to Income Tax and National Insurance Contributions.

EDIT:  As of 22/10/2020 the government have updated the terms for the 3rd SEISS grant:

The Government will provide a taxable grant covering 40% of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £3,750 in total.

To be eligible for the Grant Extension self-employed individuals, including members of partnerships, must:

  • have been previously eligible for the Self-Employment Income Support Scheme first and second grant (although they do not have to have claimed the previous grants)
  • declare that they intend to continue to trade and either:
    • are currently actively trading but are impacted by reduced demand due to coronavirus
    • were previously trading but are temporarily unable to do so due to coronavirus

Job Support Scheme Replaces the Job Retention Scheme from 1st November 2020

The Job Support Scheme for employees starts 1 November 2020

The Job Retention Scheme (JRS) winds down at the end of October. It will be followed, for the next six months, by a new job support scheme, which subsidises the wages of employees working at least a third of their normal hours, to further support viable UK employers who face lower demands due to COVID-19.

In an attempt to keep employees attached to the workforce, the Government will be introducing a new Job Support Scheme from 1 November 2020, where employees will need to work a minimum of 33% of their usual hours.

For every hour not worked the employer and the Government will each pay one third of the employee’s usual pay. The government contribution will be capped at £697.92 per month.

Employees using the scheme will receive at least 77% of their pay (where the Government contribution has not been capped) & the employer will be reimbursed in arrears for the government contribution. The employee must not be on a redundancy notice.

The scheme will run for six months from 1 November 2020 and is open to all employers with a UK bank account and a UK PAYE scheme.

All Small and Medium-Sized Enterprises (SMEs) will be eligible. Large businesses will be required to demonstrate that Read more

Making Tax Digital for Income Tax Self Assessment (MTDfITSA). Are you ready?

Making tax digital for Income Tax Self Assessment

The Government has now pencilled in what they regard as a firm date to implement MTD for ITSA, for all landlords and business owners that have an income above £10,000.

The next accounting period starting on or after 06/04/2023 that meet the above mentioned criteria will need to be compiled & submitted via MTD-compatible software.

If you are self-employed or a landlord with a turnover greater than £10k, how will MTD affect you?

1.  You will need to submit a quarterly summary of your businesses income & expenses to HMRC using MTD-compliant software.  Yes, you read that correctly.  No longer can you do your tax return in one go, with a lot of our customers leaving it to December or even January before they come to see us.  As your tax agents, we would need your business transactions every 3 months, to compile, compute, and submit through to HMRC.

The timing of the quarterly updates is determined by the accounting period of the business but typically the 4 quarters will be:

  • 6 April to 5 July
  • 6 July to 5 October
  • 6 October to 5 January
  • 6 January to 5 April

2.  All your income and expenses will need to be individually logged electronically.  The technical term used is that every business transaction will have an ‘electronic signature’.  These signatures will then be submitted to HMRC every 3 months and you will receive an estimated tax projection for the year based on the information provided.

3.  At the end of the year, any non-business information, foreign income, other income, etc is added to finalise your tax affairs and submitted using the MTD-compatible software.  This replaces the need for a Self Assessment tax return.  You will then have Read more

Income Tax – Second Payment on Account Deferral

The self-assessment tax line usually follows the process outlined in the image below, with 31st July signalling the last day you can make your second payment on account before interest would be charged.

However, due to COVID-19, the 2nd payment on account can now be deferred till 31/01/2021.  This means that the amount needs to be paid sometime between now and the end of January, when you will be making the outstanding payment for your 19/20 tax return (if applicable), along with the first payment on account towards your 20/21 tax return.

You can choose to make the payment as normal if you want to but if you choose to to make the payment(s) over time, there is nothing you need to do.  HMRC has just extended the deadline and there is no need to call them or tell us.  If you have any questions please don’t hesitate to contact our expert tax agents on 020 8761 8000.

2nd SEISS grant now open for applications (started 17 August 2020)

2nd SEISS Grant Applications – NOW OPEN!

2nd SEISS grant now open for applications (started 17 August 2020)

The Government previously announced that, much like the furlough scheme, the Self-Employment Income Support Scheme (‘SEISS’) is to be extended for a second period and in fact it’s now open for applications.

If your business has been adversely affected as a result of COVID-19 on or after 14th July 2020 you can make a claim from 17th August 2020 for the second and final grant.

You can make a claim for the second grant, if you’re eligible, even if you did not make a claim for the first grant. 

Your eligibility for the 2nd SEISS grant must meet the same criteria as those outlined for the 1st grant:

  • you must have traded in the tax year 2018/19 and submitted your Self Assessment tax return on or before 23 April 2020;
  • you must have traded as self-employed in the tax year 2019/20;
  • you must have all intentions to trade as self-employed in the tax year 2020/21;
  • your average trading profits must be less than £50,0000;
  • your trade must have been adversely affected by coronavirus.

Like the first SEISS grant, the second SEISS grant is a taxable one. However, this time, it is based on 70% of your average monthly trading profits. It will be paid out in a single instalment, based on a 3-month period of average profits, and is capped at a maximum of £6,570.

Taxfile will be in touch with clients to remind them. Now that the 2nd grant is available, do feel free to call us if you’d like our assistance in helping you to make your claim.

Please remember the deadline for claiming the first SEISS grant was 13 July 2020. You can start claiming the second SEISS grant now, as it opened to applications on 17 August 2020.

Please call Taxfile on 020 8761 8000 if you need help to make a claim for either of these SEISS grants and we’ll be happy to help. Alternatively, fill in and submit the form below and we’ll be in touch to help you.

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[Article updated 17 August 2020].

First SEISS Grant Application Deadline Day Looms

First SEISS Grant Application Deadline Day Looms

Back in April, as a result of the Coronavirus pandemic, the Government announced the Self Employment Income Support Scheme (‘SEISS’), a taxable grant to support self-employed individuals and businesses affected by COVID-19.

The deadline for claiming this initial grant has been set as Monday 13 July 2020.

After this date you will no longer be able to claim for this first SEISS grant.

The 1st SEISS grant covered a 3 month period, for loss of income due to COVID-19, from April to June 2020. If you are eligible for this grant, you only have until Monday 13th July 2020 to make the claim. After this date the applications will close and you will have no means of applying.

Need Help?

If you have been putting it off, have not checked your eligibility status, or are unsure how to do so, then please call Taxfile on 020 8761 8000, and we can help you. Alternatively, fill in and submit the form below and we’ll be in touch.

(Interested in the 2nd SEISS grant? Click here).

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