Tax year 2018 / 2019
Even if your company financial year end is a different date, 6th April is always an important date on the calendar. It's the end / start of the tax year, so changes brought about by the government often take effect now.
A few things (there are more!) that are changing this time - and which we recommend that you should look into to see if they are relevant to you:
Tax and NIC thresholds increase
Thresholds above which (most) employees pay income tax (20%) and National Insurance (12%) are increasing to £228 and £162 per week respectively (or £988 and £702 per month). The thresholds for 40% (higher) & 45% (additional) tax rates have also increased.
The threshold above which Employers' National Insurance contributions (13.8%) are payable is also increasing to £162 per week (or £702 per month), so this should mean savings for both you and your staff. But remember that you do not pay Employers' NIC for anyone under the age of 21. And there are special rules for apprentices too!
If your spouse does not earn £11,850 per year, you may be able to transfer part of their tax-free allowance (up to £1,190) to you and thus earn more without paying tax. This is simple to do over the phone with HMRC.
Employer's Allowance Towards NIC
This has been in force for a couple of years now and for 2018/19 the allowance remains at £3,000 per employer. BUT the rule about sole directors also remains - if you are the only employee on your own payroll, you CANNOT claim this allowance.
THIS IS NOT AUTOMATICALLY APPLIED - REMEMBER TO TICK THE BOX ON YOUR PAYROLL SOFTWARE ON THE FIRST PAY RUN IN THE NEW TAX YEAR.
As always, we recommend that you speak to your accountant or tax adviser who will be able to offer you the best advice for your circumstances.