October Update
In our October update, we highlight that businesses now have more time to prepare for Making Tax Digital, summarise the new National Insurance and dividend tax rises and look ahead at the UK Autumn Budget.
Making Tax Digital (MTD) for Income Tax Self-Assessment Delayed for a Year
The UK Government has announced that businesses will have an extra year to prepare for the digitalisation of Income Tax. HM Revenue and Customs has acknowledged the many challenges faced by businesses across the UK as they emerge from the pandemic and have decided to introduce Making Tax Digital for Income Tax Self-Assessment (ITSA) a year later than planned, in the tax year beginning in April 2024.
This extension for MTD allows businesses more time to prepare for the changes ahead.
For further information, click here.
National Insurance and Dividend Tax Rises announced for Social Care Reform
The Government has announced that from April 2022, a new social care levy will come into place which will see UK-wide tax and National Insurance Contribution (NIC) increases.
NICs will be increased by 1.25% on earned income, with dividend tax rates also increasing by 1.25%. Money raised from these NIC increases will be allocated towards health and social care costs. The levy will be effectively introduced from April 2022, when NIC for working age employees, the self-employed and employers will increase by 1.25% and be added to the existing NHS allocation, but this levy will not apply to Class 2 or 3 NICs.
Autumn Budget 2021
Chancellor Rishi Sunak will deliver the Autumn Budget on Wednesday 27 October. The budget is expected to outline the Government’s Spending Review, detailing how the Government will deliver its promises of ensuring strong and innovative public services, levelling up across the UK to increase and spread opportunity and how the Government plans to deliver its Plan for Growth.
CavanaghKelly’s summary of the Autumn Budget will be available on our website from Thursday 28 October.
Government Announces Plans to Make Requesting Flexible Working a Day One Right
Employees in the UK could get more choice over when and where they work under new proposals to make the right to request flexible working a day one entitlement. The Government is set to propose the introduction of a day one right to one week’s unpaid leave for carers, allowing them to balance their work with caring responsibilities. These proposals are aimed at helping businesses to become more productive, whilst also accommodating the needs of both the employee and the employer.
For further information, click here.
British Business Bank Provided £80.5 million of COVID-19 Support
Covid-19 emergency finance support offered £80.5 billion to almost 1.7 million businesses through the British Business Bank (BBB) during the last financial year. The British Business Bank supported £8.5 billion through its normal core finance programmes, however this was below its target of £9.085 billion due to displacement of existing programmes by COVID-19 emergency finance schemes. The Bank was independently assessed as having deployed its expertise to the government effectively, ranging from advice on COVID-19 scheme development and delivery to fulfilling priorities on research and market engagement.
For further information, click here.
If you have any questions, please do not hesitate to contact us.
Whilst every effort has been made by CavanaghKelly to ensure the accuracy of the information here, it cannot be guaranteed and neither CavanaghKelly nor any related entity shall have liability to any person who relies on the information herein. Information given here is for guidance only. Detailed professional advice should be taken before acting on any information contained herein. If having read the guidance here, you would like to discuss further; a member of our team would be pleased to help you.