Archive for April, 2024

Where do your tips go?

Tuesday, April 30th, 2024

Many of us will have experienced good and bad service in restaurants or hotels and wondered who actually received the service charges added to bills. Was it the grumpy individual who ignored our attempts to request a bill or was it the waiter with the engaging smile who very definitely deserved his fair share of the tip paid with our bill.

Also, the days of leaving a cash tip for a table waiter seem long gone, eclipsed by the facility to pay by card or Apple Pay.

Which begs the question, who does receive our tips?

This question may be a step closer to being answered as the long awaited implementation of the Employment (Allocation of tips) Act 2023 is approaching completion. In a recent press release issued 22 April 2024, the Department for Business and Trade said:

“Millions of UK workers are set to take home an estimated £200 million more of their hard-earned cash, as landmark legislation on tipping took a step towards coming into force.

“Today, Government introduced the Code of Practice on the fair and transparent distribution of tips that will have legal effect under the Employment (Allocation of Tips) Act 2023.

“The updated Code of Practice will be statutory and have legal effect, meaning it can be introduced as evidence in an employment tribunal.”

But will this legislation actually ensure that employees receive the tips paid by customers as a reward for the service? Apparently, yes it will; the announcement continues:

“The Act and secondary legislation make it unlawful for businesses to hold back service charges from their employees, ensuring staff receive all of the tips they have earned. The measures are expected to come into force on 1st October 2024, once they have been approved by Parliament.

“Alongside the updated Code of Practice, we have also published the formal Government response to the public consultation which sets out the feedback received during the consultation, the Government’s response and next steps.

“Many hospitality workers rely on tips to top up their pay and are often left powerless if businesses don’t pass on service charges from customers to their staff.

“This overhaul of tipping practices is set to benefit more than 2 million UK workers across the hospitality, leisure and services sectors helping to ease cost of living pressures and give them peace of mind that they will keep their hard-earned money.”

It will be interesting to see how affected employers will implement these changes. The details of the draft code or practice can be accessed here:

High risk and all eggs in one basket

Thursday, April 25th, 2024

The “boomer” population was used to the idea that you could have a job for life. That loyalty to your employer, and their ability to guarantee continuing employment, was something to rely on.

How things have changed.

Since the late twentieth century, employment has become a more transient affair. There are very few in the employed workforce who would believe in absolute job security and current and past world events have only increased job insecurity. For example:

  • The fallout from the COVID pandemic, particularly lockdowns.
  • Disruption due to BREXIT.
  • Global tensions, in Ukraine, and more recently Israel.

Which is why there may be an argument for securing income from multiple sources.

Ideas for income streams you may be able to cultivate

The following suggestions may or may not suit your circumstances, but most of us will have options to supplement our income. The key is to explore these options.



  • Rent out your drive or DIY equipment.
  • Rent a room in your home.
  • If you have the capital, buy and let property and keep the day job.
  • Turn your hobby into a small business utilising online shopping platform such as
  • Offer to write copy for business owners on your specialist topic.
  • Hire your car to third parties.
  • What other skills do you have? Look for part-time employment in more than one sector. For example, drive a taxi and deliver for supermarkets.


Business owners

  • Sub-let surplus office space, warehousing, or factory space.
  • Do you have under-utilised plant, vehicles, or other equipment that you could hire out?
  • Do you have staff that you want to retain in your business long-term that you could sub-contract to other firms for limited periods?
  • Could you franchise your business?


And last, but very definitely not least:


  • Could your business develop an online sales platform?


Let’s take a look at your options

If you would like to explore your options, pick up the phone. Having all your income sourced from one source – eggs in one basket – may not be the best option.

More corporate red tape

Tuesday, April 23rd, 2024

We are still waiting for the government to introduce secondary legislation that will oblige directors and others with significant control – so-called PSCs – to verify their identity in order to file documents or set up a company at Companies House.

According to Companies House this will:

“…deter those wishing to use companies for illegal purposes.”

Who needs to verify their identity

For new companies, all directors and people with significant control (PSCs) will need to complete identity verification.

Identity verification will also apply to other registration types. For example, any members of a limited liability partnership (LLP) will also need to verify their identity.

For existing companies, all directors (or equivalent) and PSCs will have a transition period to verify their identity with Companies House.

Anyone acting on behalf of a company will also need to verify their identity before they can file information at Companies House.

Company owners can verify directly with Companies House, or through an authorised agent.

You can be assured that if we act for your company, we will help you take steps to sort out this verification process.

When will verification apply from?

The following notes are copied from a GOV.UK factsheet.

For new directors, identity verification must take place before an application for the formation of a company is delivered to the Registrar. If PSCs are not verified within a short time after the incorporation of a company, they will commit a criminal offence. Post-incorporation, a director must verify their identity as soon as possible and must do so before their appointment is notified to the Registrar by a company. Individual PSCs will have a 14-day period after registering with the Registrar in which to verify their identity. For Relevant Legal Entities, this period will be 28 days. Relevant Legal Entities will need to provide the name of their verified relevant officer.

A relevant legal entity (RLE) is a company or organisation that has a significant degree of influence or control over another company. RLEs are the same as people with significant control (PSCs), but they are corporate entities rather than individual people.

Anyone wishing to file documents with the Registrar will need to verify their identity before they do so unless they are an employee or officer of an authorised corporate service provider or subject to an identity verification exception made in secondary legislation.

In general, Companies House expect identity verification to be a one-off requirement. Once a person is verified, they obtain a verified status. However, there may be instances where re-verification is required, for example if the Registrar has reason to doubt the validity of the identity verification, such as on suspicion of fraud. The events that will trigger the requirement to reverify will be set out in secondary legislation.

New employment protections

Thursday, April 18th, 2024

The following changes were enacted from 6 April 2024. These changes apply to England, Wales and Scotland. Northern Ireland is not included as employment law is devolved.

The information that follows is reproduced from a post on the House of Commons Library at,effect%20from%206%20April%202024.

Changes to flexible working

Employees can now make two rather than one request a year for flexible working, and the deadline for employers to respond to requests has been reduced from three to two months.

Employers will also have to explain the reasons for denying any request, and employees no longer have to explain the impact of their request. However, the list of reasons employers can use to deny requests is remaining the same, including factors such as cost to the business or impact on quality, performance or ability to meet customer demand.


Carer’s leave

Employees are now entitled to take one week of unpaid leave a year if they have caring responsibilities.


This applies to any employees who are caring for a spouse, civil partner, child, parent or other dependant who needs care because of a disability, old age or any illness or injury likely to require at least three months of care. The leave entitlement is available from the first day of employment with no qualifying period.


Increased protection against redundancy for pregnant employees

Employees taking certain types of parental leave now have protection from redundancy for at least 18 months. This protection means that if their role is made redundant their employer must give them first refusal of any other vacancies; however, they can still be made redundant if no appropriate vacancy is available. Previously, employees only had this protection during their period of maternity, adoption or shared parental leave.


Protection now begins on the day the employer is first notified of the employee’s pregnancy and ends 18 months after the date of the child’s birth. These protections also now extend to 18 months after the date of adoption for parents taking adoption leave or 18 months after the child’s birth in cases where a parent is taking at least six weeks of shared parental leave.


More flexibility for paternity leave

Employees taking statutory paternity leave (and pay, if they are eligible) can now split their two weeks’ entitlement into two separate one-week blocks, rather than having to take them both together. They can also take their two weeks at any time within the first year after their child’s birth, rather than within only the first eight weeks after birth as previously required.

Employees now have to give employers 28 days’ notice for each week of leave, down from 15-weeks’ notice previously, before taking leave. However, they still need to give notice of their upcoming entitlement 15 weeks before the expected date of birth.

Opening up small company reporting

Tuesday, April 16th, 2024

Companies House are working on detailed changes that will require small and micro sized companies to file information about their turnover and profits at Companies House.

Once filed, this data will be available to anyone searching affected companies’ records at Companies House.

At present, smaller companies can file abridged accounts that do not include a director’s report or a detailed profit and loss account.

What is a “micro” or “small” company?

Companies House define these as:

A company is ‘small’ if, in a year, it satisfies any 2 of the following criteria:

  • a turnover of £10.2 million or less
  • £5.1 million or less on its balance sheet
  • 50 employees or fewer

A company is a ‘micro-entity’ if, in a year, it satisfies any 2 of the following criteria:

  • a turnover of £632,000 or less
  • £316,000 or less on its balance sheet
  • 10 employees or fewer

When will this filing change occur?

The requirement to file the additional information will require secondary legislation. The process has started and could become law at any time in the next two years.

And to be clear, small companies will need to file a profit and loss account and a directors’ report, micro-entities to file a profit and loss account.

The option to file abridged accounts will be removed for both.

At present, there is no definition of the detailed information on trading that will be required. It could be limited to turnover and net profit, or it could include more detailed filing of direct costs and overheads.


For everyone’s eyes

The impact for small companies, who are used to protecting their turnover, trading margins and overheads (including salary details) from the public gaze, could be challenging.

For example:

  • competitors could work out your trading margins and undercut you,
  • it may bias buyers (your prospects) towards companies that have a larger, well established trading base,
  • your profit and loss data could be used against you in a trading dispute,
  • for micro companies that are basically “one-person bands” it may be possible to work out how much the business owner is being paid.

Of all the changes Companies House are presently considering, this is the one change that could prejudice the trading position of smaller incorporated businesses.

We await the fine print that will clarify exactly what needs to be filed, and from when as soon as the details secondary legislation is published. Meantime, if you have concerns about this future change in corporate transparency, please call.

Boost for small businesses

Friday, April 12th, 2024

In a recent press release, HMRC underlined the benefits to smaller businesses from the increase in the VAT registration threshold and the business rates freeze.

Here’s what they said:

“Small businesses have received a boost as the VAT registration threshold is raised from £85,000 to £90,000, and £4.3 billion of business rates relief comes into force.

“Recognising the inflationary pressures facing small businesses, especially with energy bills, the Chancellor Jeremy Hunt announced a raft of measures to support them at Spring Budget, sticking to its plan to grow the economy and reward hard work. Raising the threshold will take 28,000 businesses out of paying VAT altogether, and ensure the UK has a higher threshold than any EU Member State and joint highest in the Organisation for Economic Co-operation and Development (OECD).

“The small business multiplier for business rates will also be frozen from today for a fourth consecutive year, protecting over a million ratepayers from a 6.6% increase in their bills. The measure is part of the £4.3 billion business rates support package announced at Autumn Statement that includes the 12-month extension of the 75% relief for 230,000 Retail, Hospitality and Leisure (RHL) properties…”.

In summary, the changes will result in:

  • 28,000 small businesses freed from paying VAT, encouraging them to invest and grow as the threshold is raised from £85,000 to £90,000; and
  • over one million properties protected from higher bills by freezing the small business rates multiplier for a fourth consecutive year.

A new acronym

Tuesday, April 9th, 2024

Most readers of our posts will recognise the acronym CGT or IHT -Capital Gains Tax or Inheritance Tax. And the myriad of other taxes that affect most UK taxpayers in or out of business:

  • IT – Income Tax
  • NIC – National Insurance
  • VAT – Value Added Tax

But what about MTD?

What is MTD?

MTD will be recognisable by most business owners who are registered for VAT.

It stands for Making Tax Digital.

MTD for VAT purposes was introduced for businesses with a taxable turnover above the VAT registration threshold in April 2019, and since then all businesses registered for VAT are required to file their returns to HMRC using approved digital methods. In fact, all of the reputable bookkeeping software providers include the facility to file VAT returns to HMRC using the approved MTD links.

And this is the crux of the movement by HMRC to have all tax information filed electronically including personal self-assessment and corporation tax.

Eventually, pretty well all of the information presently submitted to HMRC on a formal tax return will be delivered automatically by software direct to HMRC servers.


Which introduces yet another acronym – Making Tax Digital for Income Tax Self -Assessment (MTD for ITSA).

The introduction of this filing process has been delayed for a number of years and is now due to commence for self-employed persons and landlords with an income of more than £50,000 from April 2026.

Those with income between £30,000 and £50,000 will be required to join MTD for ITSA from April 2027.

At present there is no date by which the self-employed and landlords with income under £30,000 will be drawn into this scheme.

MTD for ITSA deadlines

Before the relevant deadlines, affected traders and individuals will need to keep their records in an approved electronic format that will automatically send their returns (previously submitted on a tax return) directly from their computer to HMRC.

And this will have to be done quarterly, not annually as at present!

We are presently working our way through client lists to ensure that all affected self-employed and landlord clients are converted to using approved software in time to meet the 2026 or 2027 deadlines.

The days of delivering records in a shoe box once a year are coming to an end.

Call us now…

Digitisation of your record keeping will not only facilitate these compliance obligations, but it will also have positive benefits enabling you to better manage your finances.

If you are self-employed or an unincorporated landlord and still keep your records manually or on a spreadsheet, please get in touch. We can help you identify a cost effective software solution to have you ready and waiting for the MTD for ITSA conversion deadlines.

Tax Diary April/May 2024

Friday, April 5th, 2024

1 April 2024 – Due date for corporation tax due for the year ended 30 June 2023.

19 April 2024 – PAYE and NIC deductions due for month ended 5 April 2024. (If you pay your tax electronically the due date is 22 April 2024).

19 April 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 April 2024.

19 April 2024 – CIS tax deducted for the month ended 5 April 2024 is payable by today.

30 April 2024 – 2022-23 tax returns filed after this date will be subject to an additional £10 per day late filing penalty for a maximum of 90 days.

1 May 2024 – Due date for corporation tax due for the year ended 30 July 2023.

19 May 2024 – PAYE and NIC deductions due for month ended 5 May 2024. (If you pay your tax electronically the due date is 22 May 2024).

19 May 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 May 2024.

19 May 2024 – CIS tax deducted for the month ended 5 May 2024 is payable by today.

31 May 2024 – Ensure all employees have been given their P60s for the 2023/24 tax year.

Still time to register for the Marriage Allowance

Friday, April 5th, 2024

There is still time to register for the marriage allowance before the current tax year ends on 5 April 2024. The marriage allowance applies to married couples and those in a civil partnership where a spouse or civil partner does not pay tax or does not pay tax above the basic rate threshold for Income Tax (i.e., one of the couples must currently earn less than the £12,570 personal allowance for 2023-24). HMRC has revealed that March is the most popular month for marriage allowance applications, with almost 70,000 couples applying in March last year.

The allowance works by permitting the lower earning partner to transfer up to £1,260 of their personal tax-free allowance to their spouse or civil partner. The marriage allowance can only be used when the recipient of the transfer (the higher earning partner) does not pay more than the basic 20% rate of income tax. This would usually mean that their income is between £12,571 and £50,270 during 2023-24.

For those living in Scotland this would usually mean income currently between £12,571 and £43,662.

Using the allowance, the lower earning partner can transfer up to £1,260 of their unused personal tax-free allowance to a spouse or civil partner. This could result in a saving of up to £252 for the recipient (20% of £1,260), or £21 a month for the current tax year.

If you meet the eligibility requirements and have not yet claimed the allowance, then you can backdate your claim as far back as 6 April 2019. This could result in a total tax break of up to £1,256 if you can claim for 2019-20, 2020-21, 2021-22, 2022-23 as well as the current 2023-24 tax year. If you claim now, you can backdate your claim for four years (if eligible) as well as for the current tax year.

HMRC’s online Marriage Allowance calculator can be used by couples to find out if they are eligible for the relief. An application can then be made online at GOV.UK.

Check your National Insurance record

Friday, April 5th, 2024

There is an online service available on HMRC to check your National Insurance Contributions (NIC) record online. The service is available at

In order to use this service, you will need to have a Government Gateway account. If you do not have an account, you can apply to set one up online.

By signing in to the 'Check your National Insurance record' service you will also activate your personal tax account if you have not already done so. HMRC’s personal tax account can also be used to complete a variety of tasks in real time such as claiming a tax refund, updating your address and completing your self-assessment return.

Your National Insurance record online will let you see:

  • What you have paid, up to the start of the current tax year (6 April 2023).
  • Any National Insurance credits you have received.
  • If gaps in contributions or credits mean some years do not count towards your State Pension (they are not 'qualifying years')
  • If you can pay voluntary contributions to fill any gaps and how much this will cost

In some circumstances it may be beneficial, after reviewing your records, to make voluntary NIC contributions to fill gaps in your contributions record to increase your entitlement to benefits, including the State or New State Pension. If you would like to discuss this further, please do not hesitate to be in touch.