End of Tax Year 2018/19 Webinar

hello everyone thanks for joining us

today for our webinar oh it's gonna be

on the end of the tax year so coming up

to the end of the 1819 tax year now so

we want to make sure that we're there's

any actions that we need to take we've

got those in place before the end of the

year and also some changes for the

coming 1920 tax year so let's get

started so my name's Ben I'm the sales

manager here at crunch so I'm

responsible for onboarding other new

clients but I've got with me Michael

Michael of Ouya he's a technical senior

accountants and I bow most senior

accountants here thanks Pat so Michael

is gonna be giving you all the all the

information and know-how is that one of

the brains of the operation here at

crunch so you speak to the source so

what we're gonna be doing today is like

to see an end of tax year tips our at

any point I feel free to send us any

questions myself and Michael do our best

to answer those for you at the end of

the webinar so get them in at any point

you don't have to wait until the end to

answer your question

just get them straightened straight away

and we can see them all do our best to

answer them all in the webinar if we

don't get too many of them we'll follow

up by our email too so get those

questions and we're also going to have a

list of comprehensive follow-up reading

that you can take away and have a look

at in your own time as well so I know

that a lot of our clients are on on the

webinar today so I think a lot of you

already know what we do but for those of

you that aren't familiar with crunch or

an accountancy practice but we also do

self-employed mortgages business

insurance we assist with investments and

pension advice as well and everyone that

is a client of crunch will get a client

manager but also access to to chartered

accountants but Michael to give you all

the insight that you need to help you

run your business primarily we're

targeted at contractors freelancers

consultants small businesses that type

of thing

so first of all what are the things that

people have to do what actions do people

have to take before the end of the tax

year so we've got maybe a month or so to

go yes okay first there's to be

classified as a company director anyway

so if you are having personal allowance

of the

eleven thousand eight fifty it will be

wise laugh half salary of eight thousand

four hundred twenty four that's

basically petty or national insurance

which I showed and then also issue

dividends up to ten seven thousand nine

and twenty six now if you do both you're

looking at paying roughly on 2410 on

your tax code on the rest so that is

basically what you're looking at

you also need some factoring payment an

account which is basically just double

the income tax you need to pay so it's

payments on our cards are simply paying

next year's tax and then funds so that's

the only bit probably needs work on okay

so if any of the clients are there that

have any questions specifically about

budgeting for that payment on account

making contact the client manager or get

in touch with us here in the office and

we can kind of guide them through that

right okay great so next thing that

we've got on slides anything else great

oh yeah this is simply trying to break

down how we arrive by not at seven

thousand nine nine twenty six now the

first bit is to do it at 3400 changed

six which is the difference between your

our recommended summary and then the

personal allowance threshold which was

the eleven thousand eight fifty so that

is also not taxed at all so it's

basically a 2-0 percent

then there's the dividend allowance

itself which is two thousand pounds

that's also zero percent and the

remainder is what would be taxed at 7.5%

okay to take it up to the basic rate

threshold okay so everyone out there is

is gonna be taking dividends out of the

business but they're also gonna have a

salary so right so what do we need to

think about doing before the end of the

year for that okay we already lost

salaries them tax efficient because it's

tax deductible from your company's point

of view anyway but then they counted

obligation so on a monthly basis you

have to be fine award for their LTI

passes towards a year and now you have

to follow with water for him in

submission now this has to be done you

know how to avoid the hundred pound

fine now there are few options for

crunch clients we've got those who have

but don't want to crash tarot service

they don't need to win it at all we have

those who've got with taran peril of

them 702 they would obviously have guess

automatically turn therefore - guess

they could take on final hero for the

month and they've got those who are also

below at 7 notes button last one ever

Karen amounts they also have to file a

final one and then I guess that should

be it for those who haven't those who

loving having a recurrent a roll main to

have let's say extra salary if they want

to take up to the tax efficient amount

but then they obviously have to contact

an accountant to figure out what extra

some are really need to take because

depending on your circumstances let us

assume they've got maybe rental income

or animals and kind of the rest

computation coming don't work out how

much extra so everybody can take back

their perfect so moral their stories if

you got any questions just get in touch

with with you or someone the office now

expenses are quite a common question

that people want to to understand make

sure that they claiming for everything

that they possibly can so what do we

need to think about in expenses yes sort

of taxi Aaron this prevent to actually

make sure everything is in order anyway

so most of the directors will have just

month STI year when it's best to be

looking in your expenses so let's just

mine is like business managed they are

told it has no fee close and arrest us

time to actually all of those things and

use of home there could be trimming all

of these things so one thing the

Easterners go and it basically affects

their tax computations as well so these

are the little things they could do to

actually make sure everything is Florida

they also have to keep records records

have to be kept for six years you don't

have to keep them on paper anymore you

can help them get on hard drives or

other apps nervous for sure

so another reason to be using an app I

suppose is yes right so it's a tricks

yes for tax breaks we've got either Isis

or pensions it's got to actually make

contributions to these tax breaks if

you've basically got the funds for it

it's actually about the payments not if

it's depends on when the payments

actually made us when it affects your

tax year so if you make the payment

after the six of April it will basically

go into the next exercise

yeah so you actually need to make sure

this payment is done before mm-hmm

Mystics of people okay perfect now there

are the actions which people need to

take and like I've said a few times if

you've got any questions because we're

kind of time restricted by date get in

touch with us and we can kind of guide

you through that but for the next year

from a sixth of April forward what's

kind of changing for the nineteen twenty

year first of all this slight change to

the personal knowledge which is increase

in correct yes

it's jumped up from eleven 850 to 12,500

so that's I mean major increase that

takes its increases your basic

freshwater swore to fifty thousand so we

can actually take more dividends so that

is a positive change yes but these rates

are different for the Scottish I guess

Scottish residents so reverse why

specifically about Scottish and Welsh

changes at the webinar to so

salary any change to salary yes mister

law firm the 8422 for who has an uncle

up to eight thousand six hundred thirty

two that basically translates to seven

hundred nineteen pounds per month

there's a bit of them Karen is supposed

to several hundred nineteen pounds point

three three years ago but for crunch

clients what we are basically doing is

that was it gets a year and nests and

nineteen twenty year and would actually

get Justin started going to bring it up

to date okay and there's also employment

allowances war which is three thousand

so if you've got any

employees un titles of this if tienen

above 8650 tune like a dividend tax

changes the the tech allowance was

ruining the same at 2000 yes it's ran in

2000 but on a positive because the basic

graters increased room for 6000 up to

50,000 now we would have paid at a 32

point higher and it's basically been

saved in this 1920 that's why would

predominate to be same in Milan 12

pounds compared to the current tax year

so that again is positive for most

company directors if you're thinking

this a lot of the 8,000 second rate plus

the basic rate you should be fine on

that anyway you're looking at here on

2600 in terms of taxes again you need to

account for inventing account which

isn't in twice that amount sure so now

there are a few of our clients that do

have company cars on earth is

specifically being a change to the

electric or hybrids rates so right yes

has jumped up from 13 percent to 16 now

when I was introduced initially it was

an incentive gets people to switch from

diesel issue hybrid but then we are now

increasing the rate so it's my benefit

to space with diminishing but from 2020

the government is introducing what we

call this light it's going to consider

the range they're a hybrid car can

travel yeah and that would be the new

incentive for people to have let's say

that electric or hybrid cars you know

but at the moment there for a sense to

me okay

student loans people need to factor yes

what's loans of war that also affects

how much tax you pay so although we said

some people pay in two thousand four

hundred or two thousand six hundred that

doesn't factor in student alone so if

you want learn one

and so that would also increase the

amount anticipate now the government is

also changing the crash shows as well

from plan one or some eighteen 330 I

think that's actually coming up to

eighteen seven something or so and then

because what I plan to this war so all

this would actually increase the amount

to pay your hands of them income tax

first post red ones postgraduate loan in

space a new loan or a spinning up is a

stand for a while but this is the first

time who would actually be having the

repayments being done so was introduced

a couple of years but but from April

this year there'll be notifications in

sense to employers to start in the ducts

and push cutters blown from wages just

like we have fifteen years old and it's

different from England and Wales are

treated differently from Northern

Ireland and then squat like there's no

race they've got okay so on that note of

of Scotland's is there anything specific

to those that may be joining us from

Scotland for those in Scotland I mean

there should be aware of the wait stick

what's now already they've got five

basic rates or they've got five rates

compared to UK let's say England and

Wales we've got with four three in

England and Wales so that's the main

difference but then they've also


thresholds as well but the question is

as if you're a company director in

Scotland and then us thought taking the

recommended if your summary and

dividends used to be paying some amount

of tax as meaning that director in

English or missus and Welsh Welsh taxes

as well this is also just part of the

definition what government is also being

given our so actually came back taxes so

this is also at the moment the watch

Assembly has decided peg yeah rates in


so there's no change from that point of

view but then if you have wash residents

you need to actually keep your address

and arrest up to date with is universal

they actually know where your taxes

should be correct

okay let me says anyway to this meal

earlier on explained yesterday this

rental room yes rent a room relief if

you're a landlord or less a resident

landlord tenant then you actually all

recall rental home boutique and that has

been there for a while but the

government has caught on to the fact

that there's abuse of the system so if

you can imagine someone believe in

traveling live near premises to an

tenant it's purely for viewers like

let's say Wimbledon women someone rents

out the old property landlord is

basically not president yes she Rosalind

is there so there's tests being

introduced know where learners who need

to show some level of occupancy

while the tenant was there to qualify

for this relief okay the absence then a

risk then not having that not being able

to use the relief I care that makes

sense so I think that pretty much covers

the the vast majority of the content of

the webinar we've got a whole list of

recommended reading and articles which

you can all take away and and have

Duberman research if you are some client

or just give us a call in the office and

we'd be more than happy to help you out

if you want to have a chat now if you do

have any questions we've got Q&A section

now so if you want to get them in if you

want to ask directly we can do our best

to answer those for you now there are a

few questions that have come in my

because over there we go so what is the

limit for employer contribution an

employer contribution pension expense

and is this for any employee or just for

the director of a limited company is

that a rate yeah well I assume is there

a limit or as the was the limit anyway

three percent at the moment yes they are

inquisitive three percent and it's not a

moment was two percent but at the end

goes into three percent and their four

years along with pays yes it's not went

up to five percent while

was actually 3% okay

will there be a new tax calculator for

our clients to establish their personal

allowance into account yes should we be

there so yes that should be live if you

need kind of guidance to find that get

in touch with you quite managed and they

can point you in the right direction one

here about what an employment allowance

permit allows us it's an incentive to

employ less it company owners to employ

other people so it's something that the

government introduced so if you if you

have an employee just wasn't paying much

managers contribution as an employer so

the employees such as normal income tax

and then Nationals contribution on dia

summary but then the employers with

haste 1320 and sensor for that employee

now the government does give you an

allowance of three thousand so you don't

pay unless you exceeded three thousand

special services so if let's just say

that what you're supposed to pay total

for eight years nine thousand you only

paid two thousand because of three

thousand sticking out at five thousand

five so what about expenses how long do

we need to keep receipts for expenses

six years six years and they can be

digital a comedy star so he actually

wants today

great what about zoning changes to V

eighty is anything change that fix

whether it's worth becoming dat

registered or not knows there's no

changing with sense they introduced

kilometer cost trader

it doesn't really make a difference that

much in a way we usually recommend

clients beyond the standard scheme

because the the benefits of being on the

flat fee scheme is diminishing your

salsa come on here about age old

question any changes in the pipeline for

our thirty five I have to have five Wow

that's them lots of good one

there are changes from April 20 now

we're in love or the public sector one

but the changes they've introduced for

private sector is that if your end

client is basically a medium or large

size company then they would have

responsibilities of fanciful I'm

assessing whether your contract was

romantic five right if they did not want

of course within a five then they would

also allow for that you're let's say

income tax initial contributions and

they were made to his mercy if they

obviously film in theaters the

governmental agency wouldn't go after

you the company directly they would go

after the end client issues so that is

the benefit as for most of our clients

who are what an identifier unfortunately

for those who are working for an clients

who are concepts is small yeah that is

in terms of being small yeah ten over

the Empire time about would be ten point

two million okay and then panache it

says face down five points one and the

less than 50 employees those complete

directives will stop in liable so it's

this it's good to have the distinction

between the two yeah sure if he a

private company director working for

your own company for let's say one

client who's the big cause there's to be

medium or large then that inclined to

the one who's responsible if you're

working for a small sized end client

then he was talking like a responsible

now for those working for a medium and

large sizes were the five that sends us

basically gone now they wouldn't have

any more 5% allowance was their team

calculation is being done okay but then

the small one working for the small end

client the images of her criteria about

dealing with some

client is small or medium to large do

they have to fit all of those criteria

or just one of those criteria would make

them I know your voice needs to okay hmm

on the i-35 fact as well I've got a note

here that we have an article in the

knowledge section about ir35 and we've

published loads and loads of content

around this particular topic so feel

free to read those if a director has not

created a payroll run for this financial

year is there anything they can do to

maximize their tax efficiency yes it's

not too late just as well say you can do

it now and then at least avoid a penalty

but then if you haven't done that this

war that's what we call them a year

submission so it's rerunning a payroll

for the periods that you haven't done it

for and then you can put in let's say

the eight thousand four hundred eighty

four all in one lump special in this

month that this should be fine if you

would contact crunch payroll team they

could get the one done okay one of our

things to be worried about is that with

RTI submissions there's a fine if you

don't submit on a monthly days early

issues so that is one thing to confess

for but if you were to submit now what

would then happen is a doors any idea

fines will be kind of written off rigor

yeah so it's important to get in touch

anything like a so contact us if you

want to get that set up what if you work

from home only one day a week and you

still claim the four pounds yes you can

claim it covers it's not just about the

office space you I use and we also

talking about using of into electricity

you've got water whatever you use and

your pain in the house it's already

covered by that so it's yeah it's okay

it's okay okay on that no expenses a

travel expenses still claimable

redeemed fifteen I did

or you are 35 now there are different

travels on the i-35 resort and i-35

normal travel would not you know so if

you come into a time in the place of wet

you wouldn't be allowed so if you come

to crunch everyday this is so low more

yo if crunch have asked you to go to

let's say no Swindon or whatever to go

do some work fare that travel you can't

clean because it's directly related to

in the contract

okay a normal travel current record but

then but normal travel will be covered

by the 5% allowance that they have once

it comes to what you call it that

company's point of here remember that

when we are doing a DM calculation for

clients there's an allowance of five

persons given to cover day-to-day

business expenses so the government's

only or etymology only taxes 95 percent

of it so the five person that sits in

that company to cover your expenses or

contents if he is travel and only see

load up in disallowed on an

anti-violence yeah all covered under the

five others or soup so it's there to

cover good

my accounting year is not aligned with

the tax year how do I calculate my

maximum dividend this tax year when they

don't have the profit protect you well

that's an interesting one so accountant

yeah isn't aligned now there are few

things you can do dividends are first of

all available in a company if there are

enough profits so if your company hasn't

God's prophets then you can forget about

it and evidence it will be illegal

okay okay secondly work out how much

dividends you basically issue although

your company year isn't online you still

know how much the relative issued or

maybe I've issued in the company to date

yes sure yeah

so if you know what your salary is going

to be for let's say eighteen nineteen


yeah and then you know let's see if you

maybe 20,000 pounds of dividend you can

still work out that okay without salary

and 20,000 dividends if our issue maybe

two thousand more or three thousand more

it will take me to where I want to get

some your hair soft yeah tax the

basically threshold and that's what it

is but they will be invested for these

internet content here on the situation

teenagers and we need some figures in

front of us let's are doing well in our

eyes right

is it okay to claim a monthly travel

card if I buy it for convenience to

travel around London but not using it on

a daily basis there are some strict

rules about travel and travel expenses

anyway and HMRC guidance talks about

geographic location so if you are going

to a same place of work in the rest and

there's a 24 month we would have covers

business you can't be claiming these

expenses so it's a bit difficult to work

out without analyzing the situation for

a client so if that clients have been

going to the same place all in tends to

be way more the same location for the

next let's say 24 months then

technically you can be claiming that

travel but then if it's just a temporary

place of work and the rest then that can

be claimed so without knowing such

details will be a bit difficult to work

out whether that claim goes one here

regarding trivial benefits other than

the value limits clearly stated by HMRC

and in a crunch article on the topic 300

pounds total 15 pounds per expense are

there any limitations on what these

expenses can include can include eg like

any product so any you finer detail them

um no not much beautiful on though on

because them it basically says you can

use it for gifts the north yeah sure

stuff so it will be interesting to find

out what they have in mind in terms of

what you want to claim so I have to give

a better answer okay

children so get in touch yeah if you are

working for more than one end clients

you can't be sorry if you're working for

more than one client you're not under I

35 is that does that rise there no right

at all no no Roma I have thirty fives

about whether you have deemed or costly

to be an employee or not in their eyes

of what a bulletin is merci okay so if

let us say I have one major client I

work for and then the other one is

basically I do probably a few hours for

nervous each browser can likely Dean

that's the first new media contract

which is where my 90 percent or 95

percent of my income comes from who is

actually my main who employment and a we

can also look at a contract to see

whether there's a bit of control we look

at the terms of the contract oh so

you're looking of looking out for

personal service control mutuality of


yeah a fartist like financial risk being

a part and parcel of the operation what

I am office more than the rest so all of

these things were basically determined

whether you are with an added 5 or loss

it is based on a contract you can have

multiple contracts within a year some

might fall within I have five others

might not fall into either side so it

makes sense or sometimes a view limited

company is thrown open yeah and then

have multiple contracts or interest sure

if you are working for the oneness the

implies that you know even when and for

a very long time it's more than likely

it's not about a number of contracts

ofcourse yeah but about what a contract

sees over how you engage with their

client right okay got yes I particularly

like this one that I saw is there any

way I can claim a personal trainer or

about 240 pounds a month has small

Korean yeah like at the gym something

something on it that's interesting one

maybe if you probably had a

condition keys to what you do and then

you book your pocket and how to go for

sure physiotherapy and there is only

maybe you could claim that but then you

can't just Kim

personal trainer no sure it's not

related to a work right I'm gonna give

you final one before we close out I

think we're about the half-hour mark now

so if a client is over do with their

payment which is supposed to be for this

financial year how should that be

recorded if they don't pay me until the

nineteen twenty six year so the client

basically was our money then that plans

would be a trade debtor in our current

you would have raised a fine would have

raised on you was have no reason your

voice if there was some tape is thoughts

that's on their last Oh outstanding

the sills would have been generated

which would affect show their current

tax yeah yeah the humans will be in the

next year so if you look at your balance

sheet or what we now call statement of

financial position it would have in

their trade data and a creditor you

should have that amounts at the end

there and I would simply it kind of the

next year yeah let's say okay yeah one

last one how often should I issue

dividends is there a safe structure and

knowing there were so no there is no

limit to how many you don't issue

dividends and yeah as long as if what I

funds there then also there are profits

within the company's issue dividends you

should as many as you want

great so if there are any questions that

thank you for those Michael there are

any questions that we haven't got to we

will follow up our email we'll be

sending out an email to all of the

attendees regardless with some

information slides recommend reading and

things but yeah we will be following up

but if you've got any questions that you

want answered specifically just get in

touch with your client manager and they

can put you in touch with someone like

Michael who's able to give you advice

for more video so thank you very much

for joining us today everyone one final

thing before we head off is crunch

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where we host all about information blog

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equal map thanks guys