December 2020 News Update – featuring additional news developments from our newsletter series
Wishing you a Very Merry Christmas. Prestige Business Management will be closed between 24th December- 3rd January. Welcome to our news update We will help keep you informed of the latest news, developments in business support and financial affairs.
On 25 November 2020, the Government published Spending Review 2020. As part of the response to the economic impacts of the COVID-19 pandemic, the Chancellor announced that public sector pay will be “paused” for 2021/22. There will be an exemption for NHS staff. In addition, workers earning below £24,000 will receive a pay rise of at least £250, although for some this could still represent a pay cut in real terms.
The government has announced the annual increases in national minimum wage rates to apply from 6 April 2021, taking the minimum salary of those aged 23 or over to GBP 8.91 per hour.
As our valued clients are aware, Prestige Business Management works in support for our designated charity Bikers Against Child Abuse. Whilst processing furlough applications, we asked for a donation of £25 for small furlough applications that we process, and up to £200 for larger claims. This is in recognition of the lengthy processing time for us, from calculating to submitting with HMRC. We are pleased to announce that this initiative has raised £3200 and counting. B.A.C.A had these kinds words for us:
“Once again, we offer our sincere thanks for yet another outstanding donation to Bikers Against Child Abuse – your generosity truly makes a difference to our mission to empower abused children not to be afraid of the world in which they live. We cannot change their world; however, we can empower them to remove their fear and help them realise how strong they can be. It’s tangible support, from you, your clients and colleagues, which enables us to provide that much-needed to abused children. As I have said previously ‘thank you’ misses the mark by miles but it comes from the heart… So, Thank You!” We have attached the letter in full for you to read.
Earn a Cash Reward from our Client Referral Programme
We pride ourselves on how well we treat our loyal clients. Our referral programme is one way that we like to give back and reward you for your business with us. Recommend a friend to receive up to a £100 cash reward, per referral. All you have to do is recommend us. Make sure they tell us you sent them! We’ll take care of the rest. We all know how powerful word of mouth is, so please mention us to all your contacts, but you can spread the word on social media too. Get in touch to find out more.
What You Missed From Our Blog – Summary
New Economy Tax Reform
We can expect major tax reform in the New Year as we head towards a new economic climate. The Treasury is clamouring to answer how will the government manage the £300bn deficit? Which is forecast for the current fiscal year. As we bear witness to the unfolding financial crisis resulting from the pandemic, tax reform is becoming increasingly necessary. Whilst certain an initial “bounceback“ of economic growth will follow any safe removal of COVID-19 restrictions, the Treasury‘s goal of ensuring robust, long-term, and sustainable economic growth will require much work and good policy choices. Tax reform is one of the main areas on which the government can focus with the aim of boosting the economy in the long term. Implementing sustainable improvements to the tax system should attract new international business and investment, encourage domestic entrepreneurship and productivity and eliminate costs that stifle growth. Tax reform is not the only course of action, but it is one of the most impactful the government has under its control. Click here to read more.
December Top Tips
What can We Expect in 2021?
A rise in National Minimum Wage From 6 April 2021
New hourly rates recommended by the Low Pay Commission and accepted by the government will be:
Age 23 or over (national living wage rate): GBP 8.91 (up 2.2% from GBP 8.72)
Age 21 to 22: GBP 8.36 (up 2% from GBP 8.20)
Age 18 to 20: GBP 6.56 (up 1.7% from GBP 6.45)
Age 16 to 17: GBP 4.62 (up 1.5% from GBP 4.55)
Apprentice rate: GBP 4.30 (up 3.6% from GBP 4.15)
IR35 will come into force on 6th April 2021
On 17 March 2020, HM Government announced that IR35 changes planned for private sector contractors would be postponed for a year in response to the Government’s Coronavirus business support package. The one year delay now means IR35 will take effect from April 2021 instead of April 2020. This “last-minute” delay the Government argued would help the economy during the Covid-19 pandemic and thereafter.
Making Tax Digital will be enforceable from 6 April 2021
The roll out of MTD Phase 2 was postponed until April 2021 to allow businesses the breathing space to concentrate their limited resources and cash flow on surviving the COVID-19 crisis. HMRC will expect full compliance from businesses, to reaccrue tax revenue by the time that the soft landing period elapses.
VAT Reverse Charge will come into effect for the Construction Industries on 1 March 2021
The Construction Industry Scheme (CIS) VAT reverse charge will come into force on 1st March 2021. The CIS VAT reverse charge was due to commence in October 2019, but this was delayed twice, firstly as a result of Brexit and then the outbreak of COVID-19.
To find out more visit our website – https://www.prestigebm.co.uk/
To Read our Monthly Financial and Tax Newswire Round-up – Click here