InSight - Carpenter Box May 2021
Published: 02 Jun 2021
Along with our IFA arm Carpenter Box Financial Advisers, we adopted a fresh new visual identity from 4th May 2021.
Our new look is modern and encapsulates our commitment to our clients, our team members, our communities, and our profession. Our focus continues to be providing exceptional client service during these unprecedented times. Though we may look different, Carpenter Box remains independent as it has been for nearly 100 years.
We believe our new look together with our new tag line ‘Building a Brighter Future’ matches our commitment to making a difference to our clients. Our ethos centres on your success, and our team are dedicated to delivering a first-class service to help you and your business achieve your goals.
New “Help to Grow” Scheme launched for SMEs
The Government have launched a new “Help to Grow” Management Scheme which offers small businesses access to a 12 week-programme delivered by leading business schools across the UK, accredited by the Small Business Charter.
There are 30 places available across a 3 year period. The programme costs £750 and is 90% subsidised by the government as part of its Plan for Jobs to help businesses to drive growth and create jobs. It is aimed at senior leaders of small and medium businesses.
Designed to be manageable alongside full-time work, there are a wide range of modules available, including financial management, strategies for growth and innovation, leading high-performance teams, and approaches to digital adoption.
“Welcome Back” fund for high streets and seaside towns
A £56 million government Welcome Back fund was announced in March by Communities Secretary, Robert Jenrick.
The funding has been helping councils in the preparation of the safe return of shoppers and tourists, including costs towards employing extra staff to keep events and festivals COVID safe.
Pubs, restaurants and listed buildings have been granted flexibility to make more use of their land to accommodate more people in meeting up to enjoy themselves, including erecting marquees in pub gardens for the duration of Summer.
Self-employed Income Support Scheme: fourth grant
In the Spring Budget, the Government confirmed that the Self-Employment Income Support Scheme (SEISS) would be extended to provide a fourth and fifth grant.
Here we have provided some details of the fourth SEISS grant which covers the period of 1 February to 30 April 2021. The application window for the fourth grant closes on 31 May 2021.
SME Brexit Support Fund open for applications
The UK government has unveiled a £20 million Brexit support package to help small and medium-sized enterprises (SMEs) with changes to customs and tax rules when trading with the EU.
The SME Brexit Support Fund aims to help businesses prepare for the implementation of further import controls which come into force later this year.
Businesses who trade only with the EU and are therefore new to importing and exporting processes will be encouraged to apply for grants of up to £2,000 for each trader to pay for practical support, including training and professional advice, to ensure they can continue trading effectively.
Increase in National Minimum and Living wages
UK workers are to benefit from rises in the National Minimum Wage (NMW) and the National Living Wage (NLW) rates that took effect from 1 April 2021.
The NMW which applies to 21 and 22 year-olds has risen from £8.20 to £8.36 and the NLW has risen from £8.72 to £8.91. 23 and 24-year-olds are now eligible for the NLW. Prior to 1 April 2021, only workers aged 25 and over were eligible.
The change follows recommendations made to the government by the Low Pay Commission (LPC) and marks the first step towards the government’s target of the NLW reaching two-thirds of median earnings for workers aged 21 and over by 2024.
Employee Ownership Trusts – a route to an exit?
With capital gains tax constantly in the news amidst rumours of an increase in the future and with the benefits of Business Asset Disposal Relief already reduced, many company owners might be anxious about exiting without losing a significant amount in tax.
Perhaps one solution would be to sell some or all of your shareholding to an Employee Ownership Trust (“EOT”). With careful planning, you can ensure the future of your company and its employees as well as benefiting from paying no capital gains tax.
Should you be claiming Child Benefit again?
If you have previously dismissed claiming child benefit as your income is over the £60,000 per annum threshold, now is a good time to review your situation and maybe start to reclaim.
In these unprecedented times, and with the the government’s Job Retention Scheme, many individuals may see their income levels go down. Individuals placed on the 80% furlough scheme who previously earnt £60,000 (or just over) will now be receiving under £50,000 and may become eligible to claim child benefit.
Alternatively, you may see a reduction in your rental or self-employment income.
As it is not known how long such reductions are likely to go on for, or the long-term effects, child benefit may provide you and your family with some extra cash each month.
Record high for UK house prices despite the pandemic
According to the Office of National Statistics (ONS), UK average house prices have increased by 8.6% over the year to February 2021; the highest annual growth rate the UK has seen since October 2014.
At this year’s Spring Budget the Chancellor, Rishi Sunak announced that the Government would be extending the Stamp Duty Land Tax (SDLT) holiday as a Coronavirus support measure. The threshold for charging SDLT on residential property in England is temporarily raised to £500,000 until 30 June 2021. For transactions between 1 July and 30 September 2021 the threshold will be £250,000. It will then revert to the normal level of £125,000 from 1 October, and the normal 2% charge will apply between £125,000 and £250,000.
As a consequence, more buyers have been rushing to buy a property due to a “fear of missing out” before the 30 June deadline, causing a surge in prices.
Commercial Properties as a Transfer of a Going Concern
It is fairly commonplace for VAT to be chargeable on the sale of a commercial property.
VAT will generally be chargeable on the sale of a commercial property that is:
- Less than 3 years old or
- Subject to an option to tax
In certain circumstances, it is possible to structure a commercial property sale so that it qualifies as a transfer of a going concern (TOGC). Where the TOGC rules apply, the sale of the property falls outside the scope of VAT; this means that no VAT is chargeable. This removes the cash flow burden and the additional SDLT that might otherwise be due. However, the TOGC rules are very strict. If all the criteria are not met, the sale cannot qualify as falling outside the scope of VAT. It is therefore very important that you seek tax advice for such transactions.
5 changes to be made to charity law
As announced in the Queen’s Speech on 11 May 2021, the Charities Bill proposes a number of important changes to charity law.
The amendments are intended to reduce the regulatory pressure on trustees, thereby enabling them to concentrate their efforts on the running of the charity, which should help them to maximise the benefits the charity can provide.
Five of the key amendments have been outlined in our blog.
Carpenter Box Financial Advisers news update
Read the May newsletter!
As we enter the last month of Spring, Summer is on the horizon. With it comes a clear view of the 21st June. But May has plenty to offer on its own. Two Bank Holidays, pubs and restaurants opening their doors to indoor service, and we can now wave goodbye to any April showers… we hope! Who can tell with the weather we’ve been having recently?
This newsletter covers:
- Recent financial movements within the UK, including industry updates and the state of the economy
- European news
- A global overview: the US, Far East and Emerging Markets
- Spring 2021 Newsletter
- Budget Summary
- Tax Rates 2021-22
- Financial Update May newsletter
- IR35 Fact Sheet
- Domestic Reverse Charge
- Brexit Deal
- Electric car tax considerations
- The Momentum of Electric Vehicles
31 May 2021
- Deadline for filing of accounts with Companies House for accounting periods ended 31 August 2020.
07 June 2021
- VAT returns and payments due for Accounting Quarter period ending 30 April.
14 June 2021
- Last day to make CJRS claims for May.
- Last day to opt in to the online VAT Deferral New Payment Scheme.
- Last date to amend a CJRS claim for May where it has been underclaimed.
- Deadline for filing of accounts with Companies House for accounting periods ended 30 September 2020.
- COVID-19 one-year business rates holiday ends. To be replaced by a new business rates relief for eligible retail, hospitality and leisure properties.
- Stamp Duty Land Tax holiday on properties worth up to £500,000 ends. From 1 July the threshold will be reduced to £250,000 (until 30 September 2021).