1 February 2017 – Due date for corporation tax payable for the year ended 30 April 2016.

19 February 2017 – PAYE and NIC deductions due for month ended 5 February 2017. (If you pay your tax electronically the due date is 22 February 2017)

19 February 2017 – Filing deadline for the CIS300 monthly return for the month ended 5 February 2017.

19 February 2017 – CIS tax deducted for the month ended 5 February 2017 is payable by today.

1 March 2017 – Due date for corporation tax due for the year ended 31 May 2016.

2 March 2017 – Self assessment tax for 2015/16 paid after this date will incur a 5% surcharge.

19 March 2017 – PAYE and NIC deductions due for month ended 5 March 2017. (If you pay your tax electronically the due date is 22 March 2017)

19 March 2017 – Filing deadline for the CIS300 monthly return for the month ended 5 March 2017.

19 March 2017 – CIS tax deducted for the month ended 5 March 2017 is payable by today.

The end of January, self-assessment filing deadline, and the approaching tax year end seem to stimulate fraudulent activity focussing on tax issues.

In particular, increasingly convincing attempts are made to get tax payers to part with their personal bank details or other personal information for nefarious purposes.

HMRC will never ask for your personal details, particularly your bank or credit card information, by email. Accordingly, if you receive an email requesting this sort of data do not respond.

On their website HMRC confirm that they will never use texts or emails to:

• tell you about a tax rebate or penalty
• ask for personal or payment information

They also advise that you should forward suspicious text messages to 60599 or forward suspicious emails to HMRC’s phishing team at phishing@hmrc.gsi.gov.uk.

Business owners may be considering their options for investment in new equipment especially if their trading year end is March, as is often the case. There are a number of considerations:

1. Cash flow, can the business afford the cost or fund loan or other financing arrangements?
2. Will the new equipment make a positive impact to the bottom line?
3. What are the tax breaks?

Points one and two can be accommodated by revising business plans, including cash flow budgets.

The major tax break for qualifying equipment purchases is the Annual Investment Allowance (AIA).

Assets that qualify for AIA include:

• Motorcycles, lorries, trucks and vans.
• Equipment that you buy to use in your business, plant, computer and office equipment etc.

You can’t claim AIA on the purchase of cars, items that have been gifted to your business and items you owned for another reason before you started using them in your business.

From 1 January 2016, the maximum value of capital purchases that you can write off in any period of account is £200,000.

This remains a very generous investment allowance for smaller businesses. Sole traders and partners who are taxed on their business profits at higher rates (40% or 45%) will be eligible to claim a maximum tax reduction of up to £80,000 (at 40%) or £90,000 (at 45%) against their taxable income.

Planning for all of these issues needs to be carefully considered. Apart from the issues we have outlined above the timing of transactions can also be critical. We would be happy to assist. Professional advice is well worth the further investment as the benefits of a well thought out strategy will help you maximise, not only the tax relief available, but also the practical benefits of your new acquisition.

Directors have a responsibility to maintain, preserve and deliver up records that are adequate to explain the financial position of their company. If they fail to do so, they run the risk of being disqualified from acting as a director.

In a recent Insolvency Service investigation, a director was banned for seven years. His transgressions are illuminating. They included:

• He was unable to explain payments taken for his personal benefit amounting to £35,500.
• He was unable to explain the reasons for 83 cheque payments totalling £30,734.
• He authorised payments of almost £100,000 that were made when the company was insolvent, or caused it to become insolvent.

A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:

• act as a director of a company
• take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
• be a receiver of a company’s property

Costs that businesses incur to clean up after the recent storms, that affected the north and east coasts in particular, need to meet the usual qualifying criteria that they are incurred “wholly and exclusively” for business purposes in order to be a legitimate write-off for tax purposes.

If the costs are covered by insurance, no tax relief would be due. If costs are discovered to be partially covered by insurance, then only the unrecovered costs would be allowable for tax purposes.

If you have extended your business cover to include loss of profits, you can hopefully recover not only the direct costs of cleaning up but also any profits lost due to the disruption.

There are also a number of tax based risks that are not insured, but directly due to the consequences of being unable to trade after a bad weather incident. For example:

• Facing fines due to late filing of income tax, corporation tax or VAT returns;
• Loss of business accounting records;
• Adverse cash flow, unable to meet tax payments on-time;

HMRC have recently opened a new help line to assist with these consequential tax effects. They would help to:

The helpline is 0800 904 7900. The line is open seven days a week: Monday to Friday 8am to 8pm, and weekends 8am to 4pm. The line will not be open bank holidays.

There are just two months left before the end of the 2016-17 tax year. Those tax payers who have income from business or property sources, and have not yet considered their tax planning options for 2016-17, should do so as soon as possible.

Most tax planning options expire at the end of the tax year. You may lose an opportunity to ensure that you making the most of legislation that is legally available. For example:

1. The timing of investments that attract capital allowances, new plant, equipment and commercial vehicles.
2. VAT: are you using the most advantageous method to calculate VAT each quarter?
3. Is there an opportunity to involve your family in the business?
4. Should you take bonuses or dividends before or after the tax year end?

The same considerations will also apply to property owners that have rental income. Additionally, buy-to-let landlords who have borrowed heavily to grow their portfolios should be considering the effects of the gradual reduction in tax relief on their mortgage and finance interest from April 2017.

A review can, and probably should, include a realistic estimate of your various income sources for the tax year. For example, this would enable you to:

1. arrive at a realistic estimate of profits for the current financial year,
2. make decisions based on this estimate that will benefit your longer term goals,
3. take time to consider the effects of the current year’s performance on your business investors, your bank, your staff,
4. it will also give you space to consider the ability of your business to sustain your current and future remuneration and withdrawals from your business.

Another word for planning is forethought. If you don’t plan, you are apt to end up considering the reasons why things have not worked out as you expected – you will stare at the open stable door, and the empty stall, and wonder why you never repaired the lock.

There’s usually no Inheritance Tax to pay on small gifts you make out of your normal income, such as Christmas or birthday presents. These are known as ‘exempted gifts’.

There’s also no Inheritance Tax to pay on gifts between spouses or civil partners. You can give them as much as you like during your lifetime – as long as they live in the UK permanently.

Other gifts count towards the value of your estate. There may be Inheritance Tax to pay if you’ve given away more than £325,000, but only if you die within 7 years.

Inheritance Tax on gifts is paid by the person who received the gift (the ‘beneficiary’) – not the estate.

What counts as a gift?

A gift can be:

• anything that has a value, such as money, property, possessions
• a loss in value when something’s transferred, for example if you sell your house to your child for less than its worth, the difference in value counts as a gift

Exempted gifts

You can give away £3,000 worth of gifts each tax year (6 April to 5 April) without them being added to the value of your estate. This is known as your ‘annual exemption’.

You can carry any unused annual exemption forward to the next year – but only for one year.

Each tax year, you can also give away:

• wedding or civil ceremony gifts of up to £1,000 per person (£2,500 for a grandchild or great grandchild, £5,000 for a child)
• normal gifts out of your income, for example Christmas or birthday presents – you must still be able to maintain your standard of living after making the gift
• payments to help with another person’s living costs, such as an elderly relative or a child under 18
• gifts to charities and political parties

You can use more than one of these exemptions on the same person – for example, you could give your grandchild gifts for her birthday and wedding in the same tax year.

You can give as many gifts of up to £250 per person as you want during the tax year as long as you haven’t used another exemption on the same person.

The 7-year rule

If there’s Inheritance Tax to pay, it’s charged at 40% on gifts given in the 3 years before you die.

Gifts made 3 to 7 years before your death are taxed on a sliding scale known as ‘taper relief’, however, gifts are not counted towards the value of your estate after 7 years.

The Lifetime ISA will be available for young adults from April 2017 as the Savings (Government Contributions) Bill receives Royal Assent. The Help to Save scheme to help people on low incomes will be available from 2018.

The Lifetime ISA, available from 6 April 2017, can be accessed to put towards a first home or once the account holder turns 60. Under this savings scheme, adults under 40 years of age will be able to save up to £4,000 a year, with the government giving them a 25% top up on their savings.

Help to Save, which will follow the Lifetime ISA in 2018, is aimed at supporting people on low incomes to build up their savings. It carries a 50% government bonus on savings up to £50 a month for up to four years. Help to Save will be available through NS&I to any adult who is receiving working tax credit, or Universal Credit with minimum household earnings equivalent to 16 hours a week at the National Living Wage.

To encourage people to save as much as they can, the bonus will be based on the highest balance achieved in the account, not the standing balance. Roughly four million people could benefit from this new scheme.

• Help to Save example – Saving the full £50 a month for two years would mean a bonus of £600 on £1,200 of savings – and continuing to save the maximum amount for a further two years would mean another £600 bonus.
• Lifetime ISA example – Savers will be able to contribute up to £4,000 every year and receive a bonus of up to £1,000 – they can withdraw the savings including the bonus to put towards a first home, or leave them in the account, getting tax-free investment growth, until they reach 60.
• for 2017-18 only, savers will be able to transfer Help to Buy: ISA savings into a Lifetime ISA without them counting towards the £4,000 contribution limit

The first thing you can count on, is that taxation is here to stay. The second thing you can count on is that the tax rules will continue to change to meet the changing needs of our government to recover funds from the economy and restart the cycle of public expenditure that maintain services and oil the wheels of government.

Apart from increases in the basic personal tax allowance – from £11,000 to £11,500 – there are a number of key changes in tax legislation that it may be prudent to revisit before the start of the new tax year, from 6 April 2017. The following list is not exhaustive, but it does include a few of the significant changes:

• Employees that want to reimburse their employers for the value of certain benefits, will need to make good their payments by the 6 July following the end of the relevant tax year.
• From 6 April 2017, non-UK domiciled individuals resident in the UK in at least 15 of the past 20 years will be considered UK domiciled for income tax, capital gains tax and inheritance tax purposes. As part of the introduction of this change, non-doms will be able to revalue assets held outside the UK, for CGT purposes, as if they had been acquired on 6 April 2017.
• The VAT Flat Rate Scheme is undergoing a significant change from 6 April 2017. Essentially, traders registered under the scheme, who have low levels of cost on which they have paid VAT, may be required to use a fixed Flat Rate Scheme rate of 16.5%. For many traders this may make continued registration under the scheme less attractive. Readers who already use this scheme should take professional advice to see if they are affected.
• From 6 April 2017, landlords who are paying significant loan or mortgage interest payments will start to lose higher rate tax relief on these payments. The full impact of this change will not be completed for four years, but all landlords who have borrowed heavily to expand their rental portfolio should take advice; firstly, to see how they will be affected, and secondly, to see what strategies can be employed to offset the effects of higher taxation and reductions in available cash flow from their property businesses.

Readers who have concerns about any of the issues raised are welcome to call for further advice.

It is unfortunate that HMRC have designated the 31 January as the filing deadline for self-assessment purposes as we are more likely to be adversely affected by extreme weather events at this time of the year.

There are not many businesses that can continue to trade if their premises, equipment or stock have been affected by severe weather, particularly flooding.

How do you manage your cash flow if your business records are destroyed or if you are unable to use stock or equipment ruined by water damage?

Readers affected will take some comfort from a recent announcement by HMRC. They have set up a helpline where you can get practical advice and help on tax issues you may be experiencing as a direct or indirect result of severe weather. HMRC will also:

• agree instalment arrangements where taxpayers are unable to pay as a result of severe weather or flooding
• agree a practical approach when individuals and businesses have lost vital records as a result of severe weather or flooding
• suspend debt collection proceedings for those affected by severe weather or flooding
• cancel penalties when the taxpayer has missed statutory deadlines

The helpline is 0800 904 7900. The line is open seven days a week: Monday to Friday 8am to 8pm, and weekends 8am to 4pm. The line will not be open bank holidays.