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Apr 201813

Happy Financial New Year!

The New Year has begun in the financial calendar. This is the time of year where the Government implement the new rules and laws. Changes have been made to your allowances, pension and minimum wage. In our blog we will touch up on the most popular and usually most important changes. Keeping you informed and up to date!
 
Your personal allowance has gone up to £11,850 from £11,500. Your personal allowance is the amount of income you can make before you must pay any tax over. The tax you pay over will depend on which income band you are in.

Income BandTaxable IncomeTax Rate
Personal AllowanceUp to £11,8500%
Basic Rate£11.851 - £46,35020%
Higher Rate£46,351 - £150,00040%
Additional RateOver £150,00045%
 
If your income is over £123,700 then you do not get a personal allowance. Dividends allowance has unfortunately gone down from £5,000 to £2,000. If you own shares in a company and receive dividend you will have to pay tax. You only pay tax if your dividends go above your dividend allowance in the tax year. The tax rate is different for dividends.

Tax BandTax Rate on Dividends over your Allowance
Basic Rate7.5%
Higher Rate32.5%
Additional Rate38.1%
 
There has been changes to the ever-changing employment tax laws. If you employ staff, you will have to adhere to these rules. As there can be heavy fines if the rules are broken. You will have to supply a workplace pension for all staff members that qualify. A percentage of the member of staffs pay is put into the pension scheme automatically every payday. The minimum employer contribution is 2% and the minimum employee contribution is 3%.
 
The national minimum wage and living wage have increased. As an employer you are legally obliged to pay the correct rate to staff. Wage is worked out on the age an employee is. Minimum wage bands are Under 18, 18years-20years, 21-24 years and 25 years old and over.
 
Take a read of our employment law blog where we go in to the finer details of pension contributions and the national minimum wage rates. This is the time of year when company accounts are due as the next financial year rolls over, if you are stuck with yours or want more information on what steps you need to take visit our website on www.crossaccountingservice.co.uk or call us on 02920 653 995
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