Tax payments ahead!26 November 2018
2018 has been a unique year for the UK and as our previous blog on Brexit suggested, we do not appear to be out of the woods yet. With so much political and media noise going on, it might cloud what individuals and business owners may need to consider over the next few weeks.
This is not a blog about New Year's resolutions; I am sure we will post one of these in the coming weeks. It is a gentle reminder of what you may want to think about as we start to reach the end of 2018 and look beyond to 2019, which for many will be a momentous year.
We have had some clients and business contacts who wanted to get the Budget out of the way, and with this achieved and with few planned changes in areas such as pensions, they can start to look at the contributions that they need to make as they approach business year ends, often in line with the calendar year, and also to focus on the end of the tax year in early April 2019.
It is important to remember that Corporation Tax liabilities usually need to be met by 31 December, so allow time for your payment to go through over the festive season. Unlike personal tax liabilities, you do get some small interest on early payments of Corporation Tax. Bearing in mind the (usually) poor interest rates you get from business bank accounts, the interest (currently 0.50% from August 2018) might make it attractive to pay any liability early if cash flow allows.
Personal income tax liabilities on income or benefits not taxed through the PAYE system are usually payable by 31 January, with a mandatory £100 fine if you are late, so be ready and this may have a bearing on what you spend in the next few weeks as we approach the festive season. And no, sadly HMRC does not pay interest on early payment of this type of tax; however, they may adjust your tax code very slightly for paying early, again 0.50%.
We hope that the lead up to the end of your 2018 is good but be ready for a few tax payments ahead if they are applicable to you.
The Financial Conduct Authority does not regulate tax advice and the team at Chapters Financial are not accountants. No individual advice is provided in this blog. However, if you need tax advice, we can make a recommendation to a suitable accountant to help you with your needs.
Keith Churchouse FPFS
CFP Chartered FCSI
Chartered Financial Planner
Chapters Financial Limited is authorised and regulated by the Financial Conduct Authority, number 402899.