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The new tax year began on 6 April and brief details of the changes for 2019/20 are listed below:
The amount everyone can earn before paying income tax has increased from £11,850 to £12,500, which means that all taxpayers will receive a small boost. This month also sees the higher-rate tax band increase from £46,350 to £50,000.
t is estimated that these changes will help more than 32 million people to reduce their tax bill.
Unfortunately, those on the higher-rate band will also see an increase in their National Insurance contributions. As the upper earnings limit is linked to the higher-rate tax band, employees will now pay the existing 12 per cent rate on their earnings between £46,350 to £50,000 rather than the two per cent previously charged.
There are several tax-free allowances that have increased from 6 April. One of the most significant for those looking to dispose of assets is the increase in the amount of capital gains you can make in a year before paying tax, which has risen from £11,700 to £12,000.
The lifetime tax-free allowance for pension contributions has also gone up from £1,030,000 to £1,055,000, while smaller incentives, such as an increase in the Junior ISA allowance to £4,368 per annum offers taxpayers more ways of distributing their wealth in a tax efficient manner in order to reduce the amount they pay on their income.
Those nearing the end of their careers may also be concerned about the prospect of inheritance tax on their beneficiaries.
Whilst the standard tax-free nil-rate band remains £325,000 for individuals and £650,000 for married or civil partnered couples, the new residence nil-rate band allows property to be passed on in a more tax efficient manner.
This new rate increased from to £125,000 last year and has risen again to £150,000 this year.
However, in order to benefit from this rate, the property must be passed to a direct descendant and those with an estate worth more than £2 million will see the allowance taper away by £1 for every £2 over the threshold.
The state pension continues to benefit from the triple-lock, which means that many pensioners are now enjoying a 2.6 per cent increase in their state pension.
For those on the basic-state pension, they will now receive up to £129.20 per week, while the flat-rate state pension for those retiring from April 2016 onwards has risen to £168.60.
If you are in receipt of the state pension but are still working as a freelancer or contractor, it is important that you take into consideration this additional income when reporting your affairs.
Following the whittling away of mortgage interest over the last few years buy-to-let investors now only enjoy 25 per cent relief on their mortgage interest. For some, this could push them into the higher-rate tax bracket. From next year, all property investors will only enjoy a basic rate tax relief reduction, at 20 per cent.
If you started university in 2012 or after, the earnings threshold at which you start paying back the loan has increased from £25,000 to £25,725.
Those who studied before 2012 will also see their threshold rise from £18,330 to £18,935, when they repay the nine per cent of their earnings required, which could help them to save up to £54.
It is important that if you report your own earnings under self-assessment that you consider the repayment of your student loan, where one exists, and factor this into your tax return.
MPs have demanded that HM Revenue & Customs (HMRC) suspend loan charges by six months to allow an independent inquiry to investigate the tax campaign.
Both sides of the house were due to support a motion tabled by Conservative backbencher Ross Thomson this month, which was put on hold after a water pipe burst in the House of Commons.
The delay means that the controversial charge came into effect on 5 April but it is understood that the All-Party Parliamentary Loan Charge Group (Loan Charge APPG) has petitioned financial secretary to the Treasury Mel Stride to seek an urgent suspension of the new law.
Before the debate was postponed by the leak MPs, including the likes of former Brexit Secretary David Davis, stood up to critique the new tax charge, saying that it was “destroying families, homes, mental health and even lives.”
The debate in the Commons came after the Loan Charge APPG released a report on the consequences of the loan charges and HMRC’s poor conduct in the matter.
More than 900 people affected by the loan charge provided testimony to the parliamentary group, who concluded that:
If the tabled motion is passed then it could lead to an immediate six-month suspension of the charge and an independent review led by an experienced tax judge.
Other recommendations include reviewing the use of behavioural psychology and behavioural insights when considering HMRC’s behaviour, “the knowing use of which should be suspended in the light of the suicide risk and the known suicides of individuals facing the loan charge”.
“HMRC’s conduct with regard to the loan charge indicates that it is an organisation out of control, urgently needing better and proper scrutiny and genuine accountability,” the report added.
Reacting to the debate and report, a Treasury spokesperson was reported to have said : “As announced at Budget 2016 and in accordance with the legislation, the loan charge takes effect from April 5. Anyone who contacts HMRC by midnight April 5 with the genuine intention to settle their tax affairs and provides the required information will almost certainly end up paying less.
“We remain committed to ensuring that people impacted by the loan charge receive the support they need, and that individual cases are treated sympathetically in the light of individual circumstances.”
The Institute of Chartered Accountants in England and Wales (ICAEW) is “urging” taxpayers who have yet to submit their Self-Assessment for 2017/18 to do so “immediately”.
In it’s new report, the ICAEW said business owners and self-employed traders only have until the end of April to complete their tax return or risk “additional daily fines”.
The penalties for not completing the Self-Assessment return by 31 January – the official final online deadline – is an automatic £100 fine.
However, if the return is submitted any later than 30 April 2019, an additional penalty of £10 per day, up to a maximum of £900, will be due.
If it is still not complete six months after the initial deadline, a further penalty of five per cent of the tax due or £300, whichever is greater, will be due, followed by a second five per cent penalty if no submission is made after 12 months.
The report comes after the ICAEW revealed that almost 700,000 taxpayers missed the online Self-Assessment deadline in January.
Man from the year 2045 reveals who will be president after passing lie detector test
A time traveller, claiming to be from the year 2045, has passed a lie detector test, which some say proves that he is indeed from the future.
The unnamed man agreed to take part in a filmed lie detector test with Apex TV in America to prove that his story was the truth and surprised audiences when the machine indicated that he was not lying.
Relaying messages from the apparent future, the man confirms several key events in the years to come and revealed that the US president in 2045 is considered the “greatest president” the country has ever had.
Claiming to have been born at the end of 2019, the man said that in the year that he travelled from humanity had made it’s first contact with aliens and that he had a microchip implanted in his hand called The One.
Not stopping there, Apex TV then asked whether dinosaurs had been cloned, to which he said that there were dinosaur zoos, adding: “If they existed, you can see them.”
But what about the future great Commander in Chief. The anonymous time traveller said that Martin Luther King Jr’s granddaughter, Yolanda Renee King, was in power.
Aged just 10, the descendant of the great civil rights leader has already taken to the public stage last year, addressing crowds of thousands in Washington on the issue of gun control.
Throughout his interview, the unidentified man successfully answered all questions in an apparently truthful fashion.