As the nights draw in and we head towards winter, many will be focusing on the ongoing costs of energy and day to day living. Unlike last year, the majority of government support has now ended. The uneven nature of the seasons has been matched with economic news, as growth and inflation edged up, then down. Although the Bank of England has held interest rates, there may be more upward movement before a predicted slow decline.
Moving towards the year end also brings some necessary decisions for company owner directors considering their bonus or dividend options. The equation may well have shifted as tax and pension changes are likely to have affected the decision-making. In this edition of our newsletter, we explore the available options.
The articles in this issue are:
- The dividend or bonus decision The end of the tax year is drawing near and many company owners are turning their minds to deciding which is more tax efficient: a bonus or a dividend.
- Inheritance tax penalties soar The value of inheritance tax (IHT) penalties to government receipts has increased by more than half over the past two years, with higher property values and the frozen IHT nil rate band pushing more estates into the IHT net.
- Savings income and the rise in higher rate taxpayers Bank of England base rate increases, coupled with higher savings rates and frozen tax thresholds are seeing more people pushed into the higher rate taxpayer category, or paying more tax on savings income.
- Tax-deductible car charges The expansion of London’s Ultra Low Emission Zone (ULEZ) has focused attention on the business use of cars and whether clean air charges are tax-deductible.
- Is the cash basis right for you? HMRC plans to expand the availability of cash basis accounts preparation, but will it win over businesses from the traditional accruals basis?
We hope you enjoy reading the newsletter. Please get in touch if you need help or advice on any of the topics covered.