Final Payroll 2024

With the end of the 2023/24 tax year approaching, the time has come to prepare the final payroll. Submitting the last payroll of the year has a few extra steps. It’s important to know how to prepare for it.

When does the Final Payroll End?

The final payroll will be the last payroll you submit before the tax year ends on 5th April 2024. If your workers are paid monthly their last payroll will always be Week 52 as they will always have 12 pay days. For weekly, fortnightly, and four-weekly payrolls, they could have a Week 53.

Week 53 payrolls are caused when there are 53 pay days during the year. If you pay your employees on Fridays, this year you may have a week 53 payroll if you last processed your payroll on the following dates:

  • Any new employees are set up on your payroll software.
  • Any employees that have left have been processed as leavers.
  • Tax codes for 2024 are up to date.

What Should I Check Before Running the Final Payroll?

Correcting mistakes on the final payroll can be more difficult than other periods. Because of this, we would recommend double-checking all figures before processing them or sending them to your payroll provider. You should also check for the following:

  • Any new employees are set up on your payroll software.
  • Any employees that have left have been processed as leavers.
  • Tax codes for 2024 are up to date.

How do I Submit the Final Payroll?

HMRC will be notified that a submission is for the final payroll through either a Full Payment Submission (FPS) or Employer Payment Summary (EPS). If you outsource your payroll, this will be done by your provider.

How do I Correct the Final Payroll?

If you need to change the figures included on the final payroll, the corrected FPS must be submitted by 19th April 2024.

If the wrong payment date is shown on the FPS, the corrected FPS must be submitted by 5th April 2024.

What are P60s?

A P60 is a form issued to all employees showing their earnings and tax deductions for the tax year.  It is needed when completing the employment section of a Self-Assessment tax return. P60s must be sent before 31st May 2024.

What are P11Ds?

P11Ds are forms that must be submitted to HMRC to show the expenses and benefits provided to employees during the tax year. Examples of benefits include company cars, interest-free loans, and private medical insurance. The deadline for 2024 P11D submissions is 6th July 2024.

Changes from April 2024

Once the final payroll has been submitted, you should review the changes that may be needed during the new tax year. Increases to the National Living Wage were announced in November, whilst a decrease in National Insurance was confirmed during the Spring Budget.

You should also check if you have received any 2025 tax codes for your employees. These will be received either pay post or through your HMRC PAYE portal.


If you need any further information about the final payroll for 2024, or any other payroll services, please do not hesitate to contact us. We also provide a Payroll Year End Checklist which could be used as a guide.

Double Cab Pickups – Benefit In Kind Changes

Update – Government U-Turn

On 19th February 2024, 1 week after the classification criteria was updated, HMRC announced a full U-turn on the treatment of double cab pickups. It has been decided that they will now continue to use the payload system to classify vehicles, as explained in our “How Were Double Cab Pickups Treated Previously?” section. This has occurred due to push back from the motor industry over the significant increase in tax the change would have caused for most double cab pickup owners.


Changes to the tax treatment of double cab pickups have recently been announced by the government. This will change how benefit-in-kind tax is calculated for these vehicles if owned by your company. These changes will be introduced to remove a loophole which allowed them to be accounted for as vans rather than company cars. The tax paid on vans is usually lower than the tax paid on cars.

How Will Double Cab Pickups be Accounted for?

For vehicles ordered on or after 1st July 2024, new criteria will dictate that almost all double cab pickups will be classed as cars. This is due to the new legislation used to determine how a vehicle should be classified.

 If a vehicle’s primary suitability is construction, it will be classed as a van. This means that the vehicle must only be used for transporting goods. As double cab pickups can transport both goods and passengers, they cannot be classed as vans and must be treated as cars.

Vehicles that are already on fleet or have been ordered prior to 1st July will be treated as they were until 5th April 2028.

How Were Double Cab Pickups Treated Previously?

The old criteria that were used to decide whether a vehicle was a car or van was dependent on payload. A vehicles payload is usually given in the manufacturer’s manual and is equal to the gross weight minus the unoccupied kerb weight.

Vehicles with a payload under 1 tonne would be classed as cars, whilst those which are 1 tonne or over would be classed as vans.

Double cab pickups are much heavier than standard cars; they would almost always meet the old van criteria.

Will All Double Cab Pickups be Classed as Cars?

Not necessarily. Within the legislation, the government have included exceptions which could allow double cab pickups to be classed as vans. This is dependent on whether modifications have been made to the vehicle.

The modifications must be “sufficiently permanent & substantial in scale”. Examples provided include replacement of the rear side windows (either with metal panels or fibreglass) or welding a new load base.

Defining whether a modification can fit the criteria can be difficult. For example, removal of the rear seats of a double cab pickup would only be classed as substantial if all the related fittings are also removed. The easiest way to check that the modification is substantial is if it could be easily reversed. If so, the changes cannot be used to justify the van classification.

How does the Benefit in Kind Differ?

A benefit in kind (BIK) is defined as goods and services received by employees or directors from a company which are not included in their salary, for example a company vehicle. The method of taxing these BIKs is dependent on the type of vehicle they are classed as.

Vans use a flat rate to calculate the tax owed. On the other hand, the tax owed on cars is dependent on the CO2 emissions and list price of the vehicle. Please see our Vehicle Benefit In Kind Breakdown for more information on how it is calculated.


The tax owed by a basic rate (20%) taxpayer on a petrol-powered double cab pickup with a list price of £20,000 and CO2 emissions of 170 g/km would be calculated as follows if it was classed as a car:

BIK% = 37%

BIK Tax = 20000*37%*20% = £1,480

Fuel Benefit Tax = 27800*37%*20% = £2057.20

Total tax owed = £3,537.20.

The calculation for the same vehicle if classed as a van is as follows:

BIK Tax = 3960*20% = £792

Fuel Benefit Tax = £757*20% = £151.40

Total tax owed = £943.40

You would have to pay £2,593.80 more if the vehicle was classed as a car. As double cab pickups tend to have both high list prices and high emissions, the tax owed will almost always be higher when classed as a car.


If you are unsure about how these changes could affect you, or you have any other queries about tax, please contact us

Tax on Ebay, Vinted and Airbnb Sales

From 1st January 2024, digital platforms such as Ebay, Vinted and Airbnb will be required to collect and report information on their sellers’ income. This has raised concerns with users of these online marketplaces, but how much will they be affected?

What do the New Rules Mean?

Digital platforms will now need to provide breakdowns of sales made on their sites by sellers of goods and services by the end of January 2025. HMRC hopes that this system will allow information to be exchanged more quickly and efficiently. It will be as available as tax information of traditional businesses, making the tax system fairer.

It has been ruled that the digital platforms must provide a copy of the information given to the seller. This will help users to evaluate if they will need to pay tax. It also allows for transparency with what is being shared.

Examples of platforms which will be impacted include Ebay, Vinted, Depop, Etsy, Amazon, Airbnb, Uber, Deliveroo, and Fiverr.

What Information Will Digital Platforms Share?

Digital platforms will be required to provide the following information to HMRC:

  • The seller’s name.
  • The seller’s address.
  • The seller’s National Insurance number.
  • Income earned during the year.
  • Any fees incurred on the platform during the year.

If the income relates to property lets (i.e., Airbnb listings), the addresses of these properties will also be provided.

It is possible that digital platforms will increase their fees to cover the admin cost of providing this information, however this has not been confirmed.

Do I Need to Pay Tax on my Online Income?

You will only need to pay tax on your online income if you are trading or making capital gain.

To be classed as trading you must be producing or purchasing goods for resale with the intention of making a profit. If you are selling items from around the house that you already owned it is unlikely that you will be required to pay tax.

If you are trading, but your income from the digital platform was less than £1,000 (before expenses) you are not required to inform HMRC. This is because it will be covered by the Trading and Miscellaneous Income Allowance. The allowance is available to all sole traders.


Vinted, Ebay, or Depop income you receive after selling clothes from your own wardrobe that you no longer wear is not trading; you would not be taxed. However, selling clothes you have purchased purely to resell for profit through these digital platforms is trading, and would be classed as taxable income.

If you were to sew the clothes yourself and sold them through Etsy or Amazon, this would also be classed as taxable income.

You can find more information about self-assessment tax returns here. Unsure of how to pay your self-assessment bill? Please find more information here on the topic. And, if you have any further questions regarding these changes or tax returns, do not hesitate to contact us.

Self-Assessment – How to Pay

With the deadline for Self-Assessment approaching, it’s important to know both how to make your payments, and when to pay them.

What is Self-Assessment?

The self-assessment allows HMRC to collect income tax. Untaxed income must be included on a self-assessment. It will cover a tax year. Tax years run from 6th April to 5th April in the following year.

Who Needs to Complete a Self-Assessment?

You will need to complete a self-assessment if you have income that needs to be taxed. Examples of individuals who need to submit a tax return include:

  • Those with untaxed income.
  • Sole traders who have earned more than £1,000 during the tax year.
  • Directors who have drawn dividends during the tax year.
  • Those receiving income from rental properties.
  • Those with a taxable income of over £100,000.
  • Those who must pay the High Income Child Benefit Charge.

If you are unsure whether you will need to submit a tax return, you can check here.

What are the Self-Assessment Deadlines?

It is important that your self-assessment is submitted on time to avoid penalties. The deadlines are as follows:

  • Notifying HMRC that you need to submit a tax return – 5th October.
  • Paper tax return submissions – 31st October.
  • • Online tax return submissions – 31st January.
  • Payment Deadline – 31st January.

Each of these deadlines relate to the following tax year. For example, if you started renting a property in May 2023, you would need to submit a 2023-24 self-assessment. You would need to notify HMRC of this by 5th October 2024. If you were to submit a paper return for this period you must do so before 31st October 2024, or 31st January 2025 if it was submitted online. Your tax return payment must be made by 31st January 2025.

How Do I Pay my Self-Assessment Tax Bill?

There are a variety of methods which can be used to pay HMRC. These include Direct Debit, Faster Payments, CHAPS, and by Cheque. HMRC provide a breakdown of how each payment method works, and what information you will need to make them. You can find this information here.

When paying your tax bill, you should include a specific payment reference. This will be your 10-digit Unique Taxpayer Reference (UTR), followed by the letter “K”. If the wrong reference number is used it can lead to payment delays. You can find your UTR number on your HMRC online account or letters you receive from HMRC.

Paying via Tax Code

If eligible, you can pay your self-assessment tax code using your PAYE tax code. This means that the tax you owe will be automatically collected from your salary like your usual tax deductions. This can only be done if you meet the following criteria:

  • Your total tax bill is less than £3,000.
  • You already pay tax through PAYE.
  • Your self-assessment was submitted before 31st October by post/30th December online.

You can’t pay using your tax code if your taxable income does not meet the PAYE threshold, if you would be paying more than 50% of your taxable income in tax, or you would be paying more than twice your usual tax deduction.

If you meet all the criteria, HMRC will automatically collect the tax through your tax code unless specified on your tax return.

Budget Payment Plan

A Budget Payment Plan can be set up with HMRC to make payments towards the tax bill throughout the year. You can choose how much you pay and how often (e.g. weekly or monthly). The amount paid through the plan will be deducted from your next tax bill. If the payments do not cover the bill in full, you will pay the remainder by the deadline on 31st January. If you have overpaid, you can request a refund.

You can only set up a Budget Payment Plan if your self-assessment payments are up to date. You can check whether you are eligible here.

What are Payments on Account?

Payments on account are advance payments which are made towards your tax bill. You will make two payments a year, each being half of the tax bill from the previous year’s tax return. These payments are due by midnight on 31st January and 31st July. If, at the year end, your tax bill is greater than the sum of the payments made, you must pay the difference by 31st January the following year. This is known as the balancing payment.

For example, if your tax bill for the 2022-23 tax year was £2,500, and the sum of the payments on account came to £2,000 in 2022, the payment you would make on 31st January 2024 would be £1,750. This is made up of:

  • £500 for the balancing payment for the 2022-23 tax year.
  • £1,250 for the first payment on account for the 2023-24 tax year.

Please note that Payments on Account do not include capital gains or student loan payments. These will always be included as a balancing payment.

If you know that your tax bill will be less than in the previous year (i.e. you are now renting out one property rather than two), you can apply to reduce your payments on account. This can be done online via the Government Gateway or by post. You can find more information about this here.

What Penalties can be Issued for Self-Assessments?

The penalties HMRC can issue for self-assessments fall into two categories: late filing and late payment. Both types of penalty can be incurred at the same time.

A late filing penalty of £100 will be charged if the submission is 1 day late. Further penalties will be applied after:

PeriodPenalty Applied
3 months£10 per day, for a maximum of 90 days
6 monthsThe greater of 5% of the tax owed or £300
12 monthsThe greater of 5% of the tax owed or £300

For late payments, the penalties will be applied after:

PeriodPenalty Applied
30 days5% of the tax owed
6 monthsFurther 5% of the tax owed
12 monthsFurther 5% of the tax owed

If you receive a penalty which you disagree with you can appeal this with HMRC. Appeals must be made within 30 days of the penalty notice date and can be filed either online using a Government Gateway account or by post using an SA370 form. You can find more information about both methods here.

What Happens if I Over/Underpay?

No matter which payment method you use, if you overpay your tax bill, you will receive a refund from HMRC. If you have underpaid, interest will be charged. You will be able to track if your payments have been received on your HMRC online account.

If you have any further questions about paying your Self-Assessment tax bill, please contact us.

Claiming unpaid mileage

Claiming unpaid mileage by employer?

If your employer doesn’t pay for mileage allowance at all you are entitled to claim Mileage allowance relief (MAR) on your work-related mileage at the HMRC advisory mileage rates.

For the first 10,000 miles for cars and vans the rate is 45p, then the rate drops after 10,000miles to 25p per mile. for motorcycle this is 24p for all mileage and Bicycles is 20p per mile. Remember you can claim up to 4 years if you have not done the claim previously.

If you are reimbursed by your employer at a lower rate than the HMRC approved mileage rates, you are entitled to Mileage allowance relief (MAR) for the difference. For example, if you drive your own car and have been reimbursed at 30p per mile for 3000 miles, you can claim the mileage allowance relief on £450 (3000*0.15).

How do I claim mileage relief?

The are 2 ways you can claim for mileage tax relief:

  1. If you already complete a tax return (self assessment) the mileage claim can be added on the business travel (on the employment pages on your tax return)
  2. Submit your claim using a P87 form. This can be submitted online through the HMRC Government Gateway, or printed and sent by post.

Remember to claim mileage allowance you will need to keep a mileage log/record for all business trips done during the year. For record to be sufficient as per advisory you need the records to contain the following details:

  • Date of trip
  • Distance covered.
  • Start and finish point always good idea to included full address and post code.
  • Total mileage
  • Mileage allowance already received from employer.

With advanced technology nowadays you do have apps you can use to track your mileage, or a hard copy record is also sufficient. You can find more information on how to make a tax relief claim here.

For more information about mileage and expenses claim, or If you have any further questions about tax reliefs, or any other accounting matters, please contact us. We can offer this as a service, but it will incur a small fee.

Autumn Statement 2023

On 22nd November 2023, the Chancellor of the Exchequer, Jeremy Hunt, set out the UK Government’s plans for the country’s economic growth in the 2023 Autumn Statement. This blog will outline the effects of these announcements on the public.

Growth, Inflation & GDP

It has been announced that forecasts produced by the Office for Budget Responsibility (OBR) show that the UK economy will grow by 0.6% this year and is now 1.8% larger than it was pre-pandemic. This is despite predictions in March that it would shrink by 0.2%. The rate of growth predicted earlier this year, however, was higher, meaning that the current forecast sees only a 0.6% improvement in growth for 2027 when compared with the March projections.

Inflation is currently at 4.6% and it is expected to fall to 2.8% by the end of 2024. A target of 2% has been set for 2025.

The Autumn Statement shows that GDP is expected to rise over the next four years, reaching 2% in 2027.

National Living Wage

From April 2024, the National Living Wage will increase to £11.44 per hour. This is a 9.8% increase from the current rate of £10.42. It is important to note that from April 2024, the rate bracket for ages 21-22 will be scrapped; workers aged 21 and over will be entitled to the National Living Wage.

Rates for the 2024 National Minimum Wage (workers aged 20 and under) are as follows:

  • Under 18s and apprentice rates – £6.40 per hour
  • 18–20 year-olds – £8.60 per hour

Please note that the apprentice rate only applies during the first year of the apprenticeship if the apprentice is aged 19 or over.

Employee National Insurance

Starting on 6th January 2024, Employee National Insurance will be cut to 10%. This is a 2% decrease from the current rate of NI. On an average salary of £35,000 a year, there will be a saving of £450. The government believes that decreasing employment taxes will increase employment rates as a higher net wage acts as an incentive to find work.

Taxing the Self-Employed

Self-Employed individuals currently pay Class 2 National Insurance at £3.45 per week (if your profits are over £12,570) and Class 4 National Insurance at 9% on profits between £12,570 and £50,270. The Chancellor has announced a reform for how the self employed are taxed. This means that, from April 2024, the Class 4 NI rate will be reduced to 8%. Class 2 NI will be abolished.


In line with the pensions triple lock, the state pension will increase by 8.5% to £221.20 per week.

A call for evidence has been launched by the government relating to a “lifetime provider model” of pension schemes. This would allow contributions to be paid into an existing scheme when changing employers, rather than having several “small pot” pensions.

Benefits & Back to Work Scheme

It has been announced that Universal Credit and other benefits will be increasing by 6.7% from April 2024. This is in line with the September 2023 inflation figure.

£1.3 billion is set to be invested over the next five years to help those with health conditions find work. A new “Back to Work” scheme will also be introduced which will implement mandatory work placement for claimants who have been unemployed for 18 months. If this is not engaged with the claimant may have their benefits claim closed.

Full Expensing

Full expensing is a form of relief which allows businesses to claim 100% of capital allowances on investments in qualifying fixed assets. This was originally intended to cease in March 2026; however, it has been announced today that it will now be implemented permanently.

Research and Development

The Research and Development Expenditure and SME relief schemes will be merged in an effort to simplify tax. The tax rate applied to losses will be reduced to 19%. This will apply to R&D expenditure incurred during accounting periods beginning on or after 1st April 2024.

Additional Announcements

The following information has also been announced within the Autumn Statement:

  • The local housing allowance, which has been frozen for three years, will increase, being raised to the 30th percentile of local market rents.
  • The Small Business Procurement Act means that 30-day payment terms will now apply throughout the subcontract chain.
  • The small business multiplier has been frozen for another year. It has remained at 49.9 pence since the 2020-21 tax year.
  • Business rates relief for hospitality, retail and leisure has been extended for another year.
  • Alcohol duty will be frozen until August 2024.
  • Tobacco duty will increase from 22nd November 2023.
  • A further four investment zones will be introduced. These will be in the East Midlands, West Midlands, Greater Manchester and Wrexham, Wales. They hope to increase employment in those areas.
  • Increased funding has been proposed for apprenticeships, technology and AI development, and regeneration projects.
  • £4.5 billion has been proposed for supporting companies on the approach to the Net Zero deadline over the next 5 years.

If you have any concerns regarding the changes set out in the Autumn Statement and how they could impact you and your business, do not hesitate to contact us. You can find our contact information here.

Student Loan Changes 2023

Last year, the government announced several significant changes to student loan plans. You may have noticed that your own loan deductions have changed since April 2023, or that a new plan will be implemented for this year’s students. In this blog we discuss how these updates will affect you.

Current Student Loan Schemes

Currently, there are four student loan repayment schemes. The scheme you pay through is dependent on criteria such as the country where you are based and when you started your studies. The current schemes are:

  • Plan 1 – Applies to all students, UK-wide, whose loans were taken before September 2012.
  • Plan 2 – Applies to English and Welsh borrowers from September 2012.
  • Plan 4 – Student Award Agency Scotland Loans
  • PGL – Postgraduate loans for England and Wales (PGL can also be called Plan 3)

You will only make repayments when your rate of pay passes the annual threshold. This, and the rate of deduction, is dependent on your loan scheme. The thresholds applied from April 2023 are in the table below:

Loan PlanPrevious Annual ThresholdAnnual Threshold from April 2023Rate of Deduction

Plan 5

A new student loan scheme called Plan 5 will be introduced for English individuals taking student loans from 1st August 2023, in place of Plan 2. The deduction rate shall remain at 9% of pay, but the threshold shall fall to £25,000 per year. This works out to £2083 per month, or £480 per week. This threshold shall remain until April 2028, after which it shall increase in line with the retail price index. This scheme will also increase the repayment period so that loans will be cleared after 40 years, rather than the usual 30.

Students on Plan 5 will not be expected to make payments until April 2026 at the earliest. This includes students who leave their courses early. The scheme will only apply to English borrowers as Welsh students shall remain on Plan 2.


If you were paid a salary of £26,000, you would only need to repay the 9% on the £1000 exceeding the threshold. This equates to £90 per year. If your salary was £30,000, you would be paying £450 per year.

By using this rule of £90 to pay per £1000 over the threshold you will be able to predict the contributions you are due to pay per year.

How are Student Loans Paid?

If you are employed, repayments are taken from your salary by your employer, much like tax and National Insurance. The amount deducted per pay period will be displayed on your payslips.

If you are employed but also complete a tax return you must include the total amount paid during the tax year. This figure will be reflected on a P60.

If you are self-employed the amount you owe will be calculated and included on your Self Assessment, and you will pay the amount at the same time as your tax. The figure can either be calculated before submission by your accountant, or by HMRC once it is submitted.

If you are self-employed and in need of advice, or if you are unsure if you need to complete a Self Assessment, please review the information on our page.

How to Apply for Student Loans

HMRC offer a step-by-step guide on applying for student loans. It will allow you to check if you are eligible and how large your loan can be. It also gives advice on reapplying during your study (which must be done each year of your course) and what happens with payments once you leave education. This guide can be found here.


  • “Will my student loan go on my credit file?” – No, it doesn’t. This means that taking out student loans will not affect your ability to apply for a mortgage, for example.
  • “Is there interest on my loan?” – Yes, for Plan 5 loans the interest rate will be set at the rate of inflation for the current year.
  • “Does how much I owe on my loan affect how much I pay?” – No, as the amount you pay is solely related to your earnings. The remaining balance is not a factor.
  • “Can I make additional payments towards the loan?” – Yes. Additional payments can be made at any time during the repayment period; however, these payments cannot be refunded. You can find more information from HMRC here.
  • “Will I need to make repayments if I move abroad?” – Yes, you must still pay 9% on all earnings exceeding the currency equivalent of £25,000.
  • “When will I start repaying my student loan?” – If you are earning over the annual threshold, repayments will start the April after you leave university, but Plan 5 repayments will only start from April 2026.
  • “Are student loan contributions calculated before or after tax?” – Before tax. They are calculated the same way as National Insurance contributions.
  • “Will student loan repayments affect my pension contributions?” – The student loan repayment will be deducted before the pension contribution is calculated.

If you are usure of how your loan will affect your pay, please do not hesitate to contact us.

September Mini Budget Breakdown

On 23rd September 2022, Chancellor of the Exchequer, Kwasi Kwarteng, announced a new growth plan.

This blog will provide a breakdown of the changes announced by the Chancellor and how they will impact you and your business.


Income Tax

The basic rate of income tax is set to receive its first cut in 15 years, reducing from 20% to 19%. This means that less tax will be applied to your non-dividend and non-saving income. This cut had been previously pledged by Rishi Sunak in the Spring but has been brought forward from 2024 to 6th April 2023. The government are currently estimating the average basic rate tax payers will save £130 per year.


When the growth plan was first announced, the decision was been made to scrap the 45% Additional Rate, which would have seen those earning more than £150,000 per annum being  charged at the current Higher Rate of 40% from April 2023. This has since been reviewed and, on 3rd October, a U-turn on the removal was announced; the 45% rate will now stay in place.


The 20% rate will stay in place for Gift Aid until April 2027.


Corporation Tax

The rate of corporation tax was initially expected to rise for companies with profits over £250,000 from 19% to 25% from April 2023. This increase has now been scrapped, meaning all companies will be paying at the 19% rate. The government hopes that this will encourage business owners to invest more into their companies, further improving and diversifying the UK economy.


National Insurance

At the beginning of the current tax year, National Insurance rates saw a 1.25% increase with the introduction of the Health & Social Care Levy. This aimed to increase funding for the worst affected sectors of the COVID-19 pandemic. It has now been announced that the levy will be reversed from 6th November 2022, and the National insurance rate will return to 12%. Plans to introduce the levy as a separate tax in the next tax year have also been scrapped.

This change will be reflected by a blended National Insurance rate on Self Assessments upon submission to ensure that the correct contribution is made.

This change will reduce the National Insurance bills of companies, giving a potential for further investments.


Dividend tax rates will also fall by 1.25% in the next tax year following the removal of the Health & Social Care Levy.


Annual Investment Allowance

The Annual Investment Allowance (AIA) available to claim is set to permanently be £1,000,000. Plans had previously been put in place to reduce this to the previous amount of £200,000 in March 2023. AIA allows you claim 100% tax relief on assets up to the set amount. By having this as the higher amount, businesses will be able to claim more relief, reducing their tax.


Stamp Duty

Significant cuts to Stamp Duty have been announced, and all have come into effect as of midnight on 23rd September. Stamp duty is a form of tax applied when documents are recognized, most commonly through the purchase of houses.

The Nil Rate Band has doubled, increasing from £125,000 to £250,000, allowing more people to buy homes without paying any stamp duty. It is expected to save the average buyer £2500.

First-time home buyers will not have to pay stamp duty up to £425,000 and can claim relief on properties up to £625,000.


Additional Changes

  • Universal Credit Claimants who earn less than 15 hours per week at the National Living Wage will be required to meet with a Work Coach to help increase their earnings. Their benefits could be reduced if these meetings are ignored. Extra support will be offered to jobseekers over 50.
  • New legislation will be implemented to decrease planning and building times for new roads and energy infrastructure.
  • Changes in regulations on private investments are set to allow more funding from pension funds. This is expected to boost economic growth and see a particular increase in science and technology investment.
  • Alcohol duty will be frozen for another year and is expected to be reviewed and modernised.


It is expected that in the coming weeks, like with all changes in government, further plans will be announced, tackling issues like the reduction of childcare costs and the housing supply, as well as a review on digital infrastructure.


If you have any concerns regarding these changes and how they could impact you and your business, do not hesitate to contact us. You can find our contact information here.

Dividends and Income Tax Changes April 2022

Changes to Dividends

As the new tax year begins, many changes will be made to reflect the current economic climate of the United Kingdom. One such change that shall come into effect from the 6th of April 2022 is a 1.25% increase in the Income Tax rates applied to dividends.

What are Dividends?

Dividends are the payments made out to the shareholders of a company, such as directors and investors. The dividends will come from the remaining value after the Corporation Tax that is due is taken from the total profit for the period. Because of this, the total dividends issued must not exceed the company’s profits from the current, or previous, periods.

Paying Dividends

The amount that each shareholder will be paid is dependent on the number of shares in the company that they hold. The dividends they receive will be proportional to their shares.

For dividends to be paid, a directors’ meeting must be held to the payment to be declared, even if the company only has one director, and a dividend voucher must be completed. The dividend voucher will include the date, the company name, the shareholder’s name, and the amount of dividend they will be paid. Dividends are usually paid quarterly but can also be paid in other installments such as annually or bi-annually.

Many companies will choose to pay their directors through a mix of both salary and dividends. This is because National Insurance contributions are not deducted from dividends; they are more tax efficient.

The New Income Tax Rates

The rise in Income Tax is being introduced as a part of a government scheme to increase funding for the health and social care sector, after it was hit hard by the pandemic over the last two years. Please view the table below to see how your tax rate will be impacted by the increase:

Tax Brackets Thresholds (£)


Dividend Tax Rate
2021/22 2022/23
Personal Allowance

(If no other income)

0 – 12,570 0% 0%
Basic-Rate 12,571 – 50,270 7.5% 8.75%
Higher-Rate 50,271 – 150,000 32.5% 33.75%
Additional-Rate Exceeding 150,000 38.1% 39.35%

The £2,000 dividends allowance introduced in April 2018 will still be available, meaning that any dividends within that amount will not be subjected to any tax deductions.

The government have predicted that the average loss that will be suffered because of the increase will be around £335 for those affected but has stated more than 50% of shareholders may not even need to pay any Income Tax on their dividends as they fall within the personal allowance or dividend allowance thresholds.


If you are interested in learning about the other changes brought in with the new tax year, please refer to our previous blog.

If you require assistance or any further information about how your dividends may be affected, please do not hesitate to contact us.

Changes From April 2022

With the new tax year comes several changes brought forward by HMRC. Here is a short guide to help you navigate the updates that may affect you and your business from April 2022.


Reduced VAT is Ending

The reduced VAT rate of 12.5% will be increasing back to its pre-COVID rate of 20%. The reduced rate was initially introduced in July 2020 at 5%, rising to 12.5% in October 2021, to help businesses within the hospitality sector to help with their finances after the drastic impact of the Coronavirus pandemic on their trade. This return follows the timeline set in the Spring 2021 budget.

VAT Surcharges

The changes to penalties and interest rules which were due to come in place from April 2022 has now been delayed to January 2023

Making Tax Digital

Making Tax Digital (MTD) will apply to all VAT-registered businesses from 1st April 2022. This means that, for any VAT periods starting on or after this date, VAT registered businesses must keep all of their VAT records digitally and submit VAT returns using software that is MTD accordant.

Changes to National Insurance

National Insurance (NI) is going to increase by 1.25% from 1st April 2022. Those receiving a State Pension will also receive a levy of 1.25%. This increase in tax will be in place until 31st March 2023 and has been put in place to help contribute to increased health and social care costs incurred over the pandemic.

New PAYE Thresholds

From year 2022-2023 to tax year 2025-2026, the personal allowance will be £12,570 per year

In England, Wales, and Northern Ireland the basic tax rate of 20% will be applied to annual earnings above the threshold, up to £37,700 a year. The higher tax rate will be 40% on annual earnings between £37,701and £150,000, with the additional tax rate of 45% will be applied to earnings above this.

In Scotland, their starter tax rate of 19% applies to earnings above the threshold and up to £2,162, the basic rate of 20% applies to annual earnings between £2,163 and £13,118, and the intermediate rate of 21% applies to annual earnings between £13,119 to £31,092. Scotland’s higher rate of 41% applies to annual earnings between £31,093 and £150,000, and the top rate applied to earning above this is 46%.

Increase on Statutory payments

Statutory maternity pay (SMP), Statutory paternity pay (SSP), Statutory parental pay (SPP), Statutory adoption pay (SAP) and bereavement pay will change on April 2022. All will see the weekly rate of statutory pay increase from £151.97 to £156.66 per week.

From 6th April 2022, the rate of statutory sick pay (SSP) will also increase from £96.35 to £99.35 per week.

Any employee who earns more than (or equal to) the lower earnings limit, that will increase to £123 on the same date, is entitled to statutory pay.


Please do not hesitate to contact us regarding any of the above changes and how they may impact your business