Baines Watson, Accountants, Tax Advisors & Business Consultants

05/03/2025

💰 HMRC is cracking down on side hustles! 💰

Online sellers, content creators, landlords, and even dog walkers—if you've been making money online and not declaring it, HMRC might already have you on their radar. 🚨

With new data from platforms like eBay, Vinted, and Facebook Marketplace, HMRC is targeting those who may have underpaid tax. If you get a letter, you must respond within 30 days—or risk a compliance check.

This is a clear sign that HMRC is serious about closing the tax gap. If you have a side hustle, now is the time to get ahead of the curve! Take professional advice, check if your income is taxable, and avoid penalties down the line. ✅

🔗 Useful HMRC guidance here: gov.uk

📩 Need help? Get in touch with us today to ensure you're compliant and avoid any unexpected tax bills!

HMRC has started sending letters to online sellers and side hustlers it suspects of not paying tax or disclosing sales on online platforms in 2022-23, giving 30 days to respond

13/12/2024

🎉 Big news for small business owners! 🎉

From 6 April 2025, the government is increasing company size thresholds by 50%, easing the admin burden on businesses. This means:

✅ Fewer reporting requirements for many small and medium-sized businesses
✅ Streamlined directors’ reports
✅ A potential saving of £240m annually across UK companies

Here’s a quick look at the new thresholds:

Micro-entities: Turnover ≤ £1m, Balance Sheet ≤ £500k
Small Companies: Turnover ≤ £15m, Balance Sheet ≤ £7.5m
Medium Companies: Turnover ≤ £50m, Balance Sheet ≤ £25m
Large Companies: Exceeding at least two of the medium-sized thresholds

This is a game-changer! Reduced admin and lighter financial reporting mean you can focus on growing your business.

📩 Want to know how these changes can benefit you? Reach out today for a no-obligation consultation and discover how we can help you navigate these updates with ease.

Let’s make the most of this opportunity together! 🚀

Call now to connect with business.

09/12/2024

🎉✨ Celebrate the Season, Tax-Free! 🎄🍾

Did you know? HMRC offers a fantastic tax exemption for staff Christmas parties! That means you can spread holiday cheer without worrying about extra costs for your team or business. Here's how:

🎁 What’s Covered?
✅ Up to £150 per head (including VAT).
✅ All-inclusive—food, drinks, entertainment, transport & more!
✅ Applies to both in-person & virtual events.

🤝 Who Benefits?
The exemption is tax-free for employees and doesn’t trigger extra National Insurance costs for employers. It’s a win-win!

🌟 Rules to Keep in Mind:
🎄 The event must be annual (e.g., Christmas party, summer BBQ).
🎄 Open to all employees (or at least a group, like by department or location).
🎄 Stick to the £150-per-head limit to keep it tax-free.

Let’s toast to great times, good company, and tax-smart celebrations! 🍷💃

03/12/2024

🌟 Planning for the Future: Minimize Inheritance Tax with Potentially Exempt Transfers (PETs) 🌟

Inheritance Tax (IHT) is often called a “voluntary tax” because, with proper planning, you can significantly reduce or even eliminate the tax burden on your estate. One of the most effective tools for this is the Potentially Exempt Transfer (PET).

Here’s how it works:

📅 Make Gifts to Loved Ones
Any gift made to an individual can be exempt from IHT, provided the donor survives seven years from the date of the gift. After this period, the gifted amount “drops out” of your estate, meaning it’s no longer subject to IHT.

📉 Taper Relief for Shorter Survival
If the donor dies within seven years, the tax owed is calculated on a sliding scale, with the liability decreasing the longer the donor survives.

💡 Example in Action
Gerald gifted £250,000 each to his children, Lucy and Lauren, in October 2016. By surviving until October 2023, these gifts will completely drop out of his estate, saving his family up to £200,000 in IHT (40% of £500,000)!

🔒 Protect the Interim Period
Concerned about not surviving the full seven years? You can safeguard against the IHT liability by taking out decreasing term assurance, which covers the reducing liability over time.

⚠️ Key Tip:
Remember, if a PET comes into charge, transfers are offset against the nil rate band in chronological order. This could impact taper relief, so careful planning is essential.

✅ Why Consider PETs?
PETs are a powerful way to transfer wealth to your loved ones while reducing the IHT burden on your estate. With the right advice, you can ensure your hard-earned wealth goes to those who matter most.

💼 Need help with IHT planning? Get in touch today to explore how PETs and other tools can work for you!

13/11/2024

🚨 Big changes ahead for employers' NICs starting 6 April 2025:

> Employers' NICs rate will rise from 13.8% to 15%
> Secondary threshold (when NICs start) will decrease from £9,100 to £5,000
> Employment Allowance will increase from £5,000 to £10,500 and will be available to all employers (removing the previous restriction for those with NICs liabilities over £100,000)

These updates, alongside higher National Minimum Wage rates and potential employment law reforms, could put added pressure on wage budgets, especially for small and medium-sized employers.

👉 How do you think these changes will affect your business, especially if you're a smaller employer? Will it impact hiring, wages, or even prices? Share your thoughts!

01/11/2024

📢 Budget Update: Changes in Company Car Tax 🚗

Big changes for company car owners and employers! Here’s what you need to know:

🔹 Increased Tax Rates: Starting April 2028, the top tax rate on high-emission company cars will jump to 39%, while zero-emission vehicle rates will rise to 9%. Rates for hybrids and other vehicles will increase, pushing for a shift to electric.

🔹 Crackdown on Schemes: New rules coming April 2026 will close tax loopholes on contrived ownership schemes, ensuring company car tax is applied consistently.

🔹 EV Support Continues: To aid the transition, the government is investing £200m in EV charge point rollout, plus extending tax incentives for electric vehicle purchases through 2029-30.

These updates signal the government’s push toward a greener future. Interested in how this impacts your fleet? Reach out to discuss your options! 🌍💼

31/10/2024

🚨 Double Cab Pick-Up Trucks Now Taxed as Personal Vehicles? 🚨

In the latest Budget, Labour has announced new tax rules for double cab pick-up trucks (DCPUs) with a payload of more than 1 tonne. From April 2025, DCPUs like the popular Ford Ranger will be taxed as personal vehicles for income tax and corporation tax, impacting capital allowances, benefits in kind, and business deductions.

The policy change revives an idea dropped earlier this year after an uproar from the farming and motoring sectors. Employers who bought or leased these vehicles before April 2025 can still use the previous system until 2029.

This will impact key buyers like businesses in the construction industry and farmers, especially with changes to capital allowances and benefits in kind.

👀 What do you think of the revised policy? Will it impact your business?

Let us know!

24/10/2024

This article highlights the immense contribution of London to the UK’s overall income tax revenue, underscoring the city’s status as a powerhouse of economic activity. With London alone contributing nearly £60 billion—almost 27% of the total national tax take—its importance cannot be overstated. The concentration of high-income earners in boroughs like Kensington & Chelsea, Westminster, and Camden reflects the city's role as a global financial and cultural hub.

However, the wide disparity in tax contributions across the UK also brings attention to the importance of efficient tax management. For individuals and businesses, especially in high-paying regions, maximising the tax efficiency of their affairs is essential. This doesn’t mean evading tax obligations but ensuring that you leverage all available tax reliefs, allowances, and planning opportunities.

Being proactive about tax planning not only helps manage your contributions responsibly but also allows you to reinvest more back into your personal or business growth. Given the scale of tax contributions from London and the southeast, individuals in these areas should seek expert advice to ensure they pay what’s due—no more, no less—while contributing to the sustained growth of the UK's economy.

London and the southeast of England pay more than a third of annual income tax, with Kensington & Chelsea, Elmbridge in Surrey and northeast Cheshire topping the list