Bridgend Council has revealed designs for a £1.8 million project that it hopes to build in Porthcawl.

The council wants to develop a new building with community facilities and space for shops and start-up businesses at land on Porthcawl seafront, known locally as 'Cosy Corner'.

Click here to find out more

The UK Government announced a new capital allowances relief. From 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will be able to claim:

• 130% super-deduction capital allowance on qualifying plant and machinery investments
• 50% first-year allowance for qualifying special rate assets

This super-deduction is designed to promote companies to invest in productivity enhancing plant and machinery. It is important businesses understand and take advantage of these generous new reliefs while they are available.

The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest, ensuring the UK capital allowances regime is amongst the world’s most competitive. There is no upper limit set for the expenditure, so as long the expenditure is incurred between 1 April 2021 – 31 March 2023. The enhanced relief also does not allow for plant and machinery that will be made available for leasing (including landlord fixtures within rented property) and excludes cars.

The pandemic has been a big blow for a lot of businesses, if you have been looking at equipment to help you grow, now may be the time to use this relief. If you are not sure on whether it is the right time to make a purchase, or if the equipment qualifies for the super-deduction relief, message us on nicola@crossaccountingservice.co.uk or if you would prefer to chat, call Cardiff: 02920 653 995 or Bridgend: 01656 530 063. Our team is always happy to help.

We are seeing a lot of restrictions being eased and it is the closest to normality for a very long time. The bonus of the sunshine is something to make the most out of. While we enjoy ourselves and plan for an entertaining summer, we should not forget about business. We should take steps in to planning on how to bounce back stronger.

As the country opens slowly and the opportunity arises to mingle with other business owners, you should make time to try and attend where businesses are likely to be. Nearer the end of 2021, we are likely to see trade fairs taking place, with all businesses on the same boat, getting the business name out there.  

If you do not have the budget or time to be a part of the trade show, then you should try and attend as a visitor. It will be a great way to connect and being a visitor will give you the freedom on your timing as you can leave when you feel like you have made the most out of the day. Who knows, you may even bump into some familiar faces, for a long-awaited catchup.

Our usual go to for these types of events are The Welsh Business Show, Zokit and Introbiz. Some may have updated dates for the events, some may be posting later. Keep an eye out on social media as we are sure there will be a buzz. Click here to look at what is out there with trade fairs https://10times.com/cardiff-uk/business-consultancy/tradeshows

To get your company to achieve the highest levels, you may need a hand by employing staff. This may seem a scary step to take, especially if this will be your first time employing someone. There are many things to consider. Due to the disruption of jobs during the pandemic, the government have introduced a Kickstart scheme. This scheme is to provide funding to create new jobs for 16- to 24-year-olds on Universal Credit.

It does not matter on the size of your business, everyone can apply. The funding will cover:

·        100% of the National Minimum Wage (or the National Living Wage depending on the age of the participant) for 25 hours per week for a total of 6 months

·        Associated employer National Insurance contributions

·        Minimum automatic enrolment pension contributions

Further funding is available for training and support so that young people on the scheme can get a job in the future.

More info on how to apply, please click here https://www.gov.uk/guidance/apply-for-a-kickstart-scheme-grant

If you already have staff, and are bringing them back in to work, remember the furlough scheme is flexible and available until 30 September 2021. You will have to contribute for any hours worked by your employees. From 1 July 2021, the level of grant will be reduced, and you will be asked to contribute towards the cost of your furloughed employees’ wages. To be eligible for the grant you must continue to pay your furloughed employees 80% of their wages.

You can continue to choose to top up your employees’ wages above the 80% for the hours not worked at your own expense. This is completely up to you and not a requirement.

Let us try and finish 2021 strong and push past this pandemic. It has been tough for everyone, but with planning and preparing, we can start looking ahead.

All the important rates and threshold for the tax year 2021/2022

National Minimum Wage

This takes effect from 01 April 2021 and all workers are entitled to.

Please note the age rate bracket has changed from previous years also.

PAYE Tax Rates and Threshold

These rates depend on the amount of income you earn.

Employment Allowance

Employment Allowance allows eligible employers to reduce their annual National Insurance liability by up to the annual allowance amount.

Statutory Sick Pay (SSP)

The same weekly SSP rate applies to all employees. However, the amount you must actually pay an employee for each day they’re off work due to illness (the daily rate) depends on the number of ‘qualifying days’ they work each week.

Dividend Allowance

You also get a dividend allowance each year. You only pay tax on any dividend income above the dividend allowance.

Mileage Allowance

The allowed deductible rate per mile for business use.

It has been great to see the UK finally move in a positive direction out of lockdown. While we can look forward to restrictions loosening, we need to remember the financial new rules coming in April. It is always this time of year when the financial rules start to come in to place, the budget will be announced this week, and we will digest this for you to see what kind of economical shape we will be in, so keep your eyes for that one.

IR35 (Off Payroll Working)

The long overdue of IR35 also known as off payroll working, was initially announced to come in, in April 2020, however due to the pandemic, this has been pushed back to April 2021.

This will affect you if you are in the private sector from any industry and provide a service through an intermediary such as your own limited company, a partnership or an individual who is on self-assessment and the client could constitute an employer/employee relationship.

So, why are these rules coming in?

The rules are coming into level the playing field and to make sure that workers who would have been an employee if they were providing their service directly to the client, pay broadly the same tax and national insurance contributions as employees. You could claim travel expenses and other expenses before, which would lower your tax liability, now this will not be allowed.

If you are a worker and your client is in the private sector, it is your responsibility to decide your own employment status for each contract. Things that will help decide your employment status are;

·         Who has the control? Can you reject certain projects and decide your working days?

·         Do you use your own tools?

·         Do you have public liability insurance?

If you are a worker and your client is in the public sector like a school or library, it is their responsibility to decide your employment status. You should be told of their decision; we have seen a large number of the larger companies starting to make changes to their arrangements with their subcontractors in preparation for this.

Reverse Charge VAT

If you are in the construction industry, there are changes coming in from

1^st March 2021 to the way you apply VAT to your invoices. If you are VAT registered in the UK, and supply building and construction industry service, if the following applies for you, then you will have to use the reverse charge;

·         Your customer is registered for VAT in the UK

·         Payment for the supply is reported within the Construction Industry Scheme (CIS)

·         The services you supply are standard or reduced rated

·         You are not an employment business supplying either staff or workers, or both

·         Your customer has not given written confirmation that they do not make onward supplies of the building and construction services supplied to them, also known as an end user.

So, that might have been a bit of jargon and hard to follow, so let us break this down in simpler terms.

Example 1

If Alpha Ltd are selling a standard or reduced rated service for building and construction to Joe Bloggs (this can be a company as well), and Joe Bloggs is VAT and CIS registered and has not given Alpha Ltd written confirmation that he is an end user, then the reverse charge VAT must be used.

Alpha Ltd bills Joe Bloggs;

Net - £1,000

VAT - £0

Gross - £1,000

(Reverse charge applies)

Example 2

If Alpha Ltd are selling a standard or reduced rated service for building and construction to Joe Bloggs, and Joe Bloggs is not VAT registered, then the reverse charge must not be used, and VAT must be charged as normal.

Alpha Ltd bills Joe Bloggs;

Net - £1,000

VAT - £200

Gross - £1,200

The services you may provide that are subject to reverse charge are;

·         constructing, altering, repairing, extending, demolishing or dismantling buildings or structures (whether permanent or not), including offshore installation services

·         installing heating, lighting, air-conditioning, ventilation, power supply, drainage, sanitation, water supply or fire protection systems in any building or structure

Please click here for the full list of services.

What you will need to do

If you are needing to use reverse charge VAT then you will need to verify some of your customers information. You will need to verify;

·         If your customer has a valid VAT number – (Click here to verify)

·         If your customer is reporting under CIS. (This can be verified using the construction industry scheme online service)

Sole trader:

o   Name

o   Unique taxpayer reference

o   National Insurance number

Company:

o   Name of Company

o   Company’s unique taxpayer reference

o   National Insurance number

·         Ask your customer to confirm whether they are an end user or intermediary supplier (you will need written confirmation)

These rules will be enforced by HMRC, so you will have to take care to do this correctly. If you are facing problems with your own subcontractors with IR35, or if you are not sure whether this reverse charge VAT applies to you, please get in touch with us. This can be complicated to get your head around.