As of April 2012, the maximum amount of annual investment allowance (AIA) reduces to £25,000. Currently, businesses can write off 100% of the cost of acquiring qualifying assets against their taxable profits up to an annual limit of £100,000.

The revisions to the measure will take effect from 1 April 2012 for businesses within the charge to Corporation Tax (CT), and 6 April 2012 for businesses within the charge to income tax.

Businesses that invest over £25,000 will continue to be eligible for plant and machinery writing-down allowances on expenditure not covered by the AIA.

Assets that can be written off in this way include plant and commercial vehicles, computers and other equipment, however, cars do not qualify.

Things to consider prior to April 6th:

It’s that time of year again, and we don’t mean Christmas. The paper tax return deadline has long passed, and the online deadline is looming (31 January). You can be forgiven for becoming caught up in the throes of planning for the festive season, but submitting your tax return late, can carry harsh penalties, even if by just one day.

If you miss the January 31st deadline to file your 2010-2011 return, HMRC will charge you £100. This applies even if you have no tax to pay or have paid the tax you owe.  If your return is 3 months late, you will be charged £10 for each following day – up to a 90 day maximum of £900. This is in addition to the £100 fixed penalty. For penalties thereafter, visit http://www.hmrc.gov.uk/sa/deadlines-penalties.htm (hopefully these won’t apply to you).

Don’t get caught out by submitting two returns!

If you have missed the October paper deadline, you still have time to register to file an online return.

If you submitted your paper return late (after 31 October), you may incur a fine of £100.  Submitting an online return as well does not cancel the penalty – beware!!

This report provides a concise summary of the announcements made in the Autumn Statement.

As expected, the Office for Budget Responsibility downgraded its growth forecasts, and revealed that Government debt is higher than expected.  Meanwhile, the sovereign debt crisis in Europe adds external pressures over which we have little control.

As a result, announcements spanned from protective measures such as raising the state pension age to reflect an aging society, to the much anticipated credit easing, designed to reduce the cost of loans to small businesses and easing access to funding.

This documents includes announcements on the Economy, Business Finance, Pensions, Tax Credits, Travel and Housing. Please read the report and contact B20 Ltd if there are matters arising that are pertinent to you or your business.

Download Autumn Statement 2011 report

There are approximately six million of us in the UK who are due to receive refunds to an average of £400, and some reaching the £1,000s. This finding follows the annual check of who paid what, which also uncovered the one million people who have not paid the right amount of tax, owing an average of £600.

This is not the first time these inconsistencies have been uncovered. It follows the introduction of a new computer system at the HM Revenue and Customs, which is tracking down reconciled cases dating back many years. The good news is that anyone owed money will be paid back with interest without the need to contact them (although they do not give a timeframe for this!).

As the first letters start to find homes across Britain, here are some valuable need-to-knows:

• WHAT IS A TAX CODE?
  • These are a series of digits which tell your employers how much tax to deduct. One of the most common is the 747L code. Add a five to the end of the numbers (£7,475) and you’re presented with the amount you can earn before income tax is taken.

• THE WRONG POSTAL ADDRESS MEANS YOU WILL MISS THE REBATE
  • The HMRC must have the correct address for you in order to post out your tax rebate. If you’ve moved, or assume that your employer updates the address, think again. Update your address here: HMRC address update form

From October 2012, all employers must automatically enrol staff (with only a few exceptions), into a pensions scheme, and provide an employer’s contribution. In time, this will also apply to any family that employs a nanny (if earnings exceed a threshold), and the likes of builders who have a couple of full or part time workers.

With an aging population, and small businesses making up 99.3% of all businesses in the UK, the purpose of NEST (National Employment Savings Trust), is to make it easier to save for retirement. Thousands of small businesses do not realise the impact of the ruling, and the extra cost it will incur to their business.

How much will it cost?