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New tax year, new rules: changes to business and personal tax
With spring upon us and a new tax year just beginning, a number of previously announced changes are coming into force. These may affect your personal taxation or business concerns, so be sure you're up to date with the latest legislation. Here we provide an overview of some of the major changes for 2015/16…
Corporation tax for UK businesses has been reduced to 20%, a reduction of 1% on last year and a fall of 8% over the past five years. The UK now has the lowest rate of corporation tax in the G20 economies.
The Government has raised the business rates retail discount to £1,500 for shops, eateries and pubs with a rateable value of £50,000 or less.
In a further measure to narrow the tax gap - what the Government expects to receive in taxes each year and what it actually receives - the Diverted Profits Tax has been introduced with the aim of preventing multinational companies from shifting profits offshore.
In a bid to help reduce youth unemployment figures, employer national insurance contributions (NICs) have now been stopped for employees under the age of 21. Additionally, individuals who hire a care worker or support worker can now save up to £2,000 on their NIC bill via the Employment Allowance.
Meanwhile, the new Marriage Allowance aims to help four million married couples and 15,000 civil partners by allowing them to transfer part of their personal tax allowance. This means one partner can transfer up to £1,060 of their unused allowance to their partner, providing that partner has earnings within the basic income tax bracket.
Tax on savings interest has also been cut to 0% for savings up to £5,000. This is applicable to those individuals who earn less than £15,600 per year.
Individuals aged over 55 have been given new pension freedoms, allowing them more choice over what to do with their savings.
The changes allow those entering retirement - around 320,000 individuals per year - to cash in their pension pots instead of having to buy an annuity. While an annuity offers a monthly income for life, the freedom to choose has been described by Chancellor George Osborne as a 'permanent revolution'.
However, warnings have been issued to ensure pensioners do not fall foul of various pitfalls in the new system.
Many changes have taken place since the start of the 2015/16 tax year, and more are due to take place in the coming months. Be sure to check with us for the latest information.
- March 2015: The new Marriage Allowance
- February 2015: Saving tax before the 5 April year end
- January 2015: VAT for digital business
- December 2014: Stamp duty reforms and business rates feature in pre-Election Autumn Statement
- November 2014: Saving tax on seasonal gifts
- October 2014: Social investment tax relief - could you and your community benefit?
- September 2014: Flexible Working Rights
- August 2014: Tax breaks for charitable giving
- July 2014: The sun is shining: let your business grow
- June 2014: Claiming the new NICs Employment Allowance
- May 2014: Tax-efficient estate planning
- April 2014: The New ISA
- March 2014: 2014 Budget Round-up
- February 2014: Could you save tax ahead of the year end?
- January 2014: Contingency planning: is your business prepared?
- December 2013: Seasonal tax advice for your business
- November 2013: Expansion - is your business ready?
- October 2013: Is your business adequately insured?
- September 2013: Charities update: some recent changes
- August 2103: The new flat-rate state pension: winners and losers
- July 2013: An inspector calls… coping with an HMRC investigation
- June 2013: Raising finance for your business
- May 2013: Ten top tips for reducing your tax bill
- April 2013: The new pension auto-enrolment scheme
- April 2013: The new cash basis: 'simpler' income and expenses?
- January 2013: Saving tax ahead of the year end
- November 2012: Child's play? The new rules on child benefit
- October 2012: Real Time Information: are you ready?
- September 2012: Are you up-to-date on pension auto-enrolment?
- May 2012: After the Budget: planning strategies to implement now
- April 2012: Making your business an Olympic success
- January 2012: The 5 April Year End - plan to save tax now
- November 2011: Autumn Statement 2011
- November 2011: Furnished Holiday Lettings
- October 2011: The Agency Workers Directive
- September 2011: Capital Allowances Are Changing: Make Sure You're Prepared
- June 2011: The Bribery Act: What your business needs to know
- May 2011: Don't get caught out by the taxman!