Tax year changes
Today marks the end of the 2018-19 tax year, it’s been a blast but it’s now time to move on.
To kick this year off with a bang, for a limited time only, we’re doing a special promotion.
Save 20% on your usual self-assessment tax bill, if you get us all the required information by 31st May 2019*.
As of tomorrow, (the 6th April 2019) we will be in a new tax year ‘2019-20’, wow how time flies!
We know you’re busy running your business or working hard at your job, that’s why we’ve condensed the changes here, so you can get on with what you do best.
The main changes being introduced that will affect you are as follows:
Your personal allowance will be rising from £11,850 to £12,500. This is the amount you receive tax-free (although you will pay small amounts of National Insurance) on amounts over £8,630
The basic rate tax band will be rising from £34,500 to £37,500, this is the amount of income you receive after your personal allowance and will be taxed at 20% (plus National Insurance)
Capital Gains exemption has increased from £11,700 to £12,000
Although it doesn’t relate directly to a new tax year, MTD for VAT (phase 1) has been introduced as of 1st April 2019, read our last blog ‘Making Tax Digital: Explained’ for more detail.
What is staying the same?
You can still deposit up to £20,000 each tax year tax-free into an ISA
The allowance for tax-free pension contributions is still £40,000 per tax year
The dividend-free amount remains at £2,000 per tax year, this is an amount of dividends you can withdraw without the need to disclose to HMRC or subject to any tax
The corporation tax rate remains at 19%, with this reducing to 17% by April 2020
Read our previous blog ‘Autumn Budget’ for more detail and changes.
With the above changes, this means the optimum mix of salary and dividends will be affected. We have built a calculator which we would be happy to share with you once you request a copy here.
*Offer valid for clients paying for their self-assessment tax return relating to 2018-19.