Tax Bands for 2019/20 and 2020/21

Tax Bands for 2019/20 and 2020/21

Your residency of your main home affects whether your tax is calculated by the different band brackets. If you moved country during the tax year, the country in which you spent the majority of your year in a main home determines your residency and which tax band to use. Many figures from the 2019/20 have not changed for the 2020/21 tax year; the overall changes appear to be made to the starter and basic rates of tax.

Furlough Explained
The word ‘furlough’ has been used many times in the news as of late, mostly as a verb. People may know someone who has been ‘furloughed’ or put on the furlough system; this is something new that has been brought in to support employees and businesses through the Corona Virus pandemic. The Government will pay employers 80% of their employees’ salaries, of up to £2,500 a month, to those who have been affected by the cautionary actions the virus has brought on. This starts from March 2020, and although the Government is issuing it for three months there is an understanding this may need to be extended for longer depending on circumstances.
Self Employment Income Support - Landlords are Ineligible
HMRC is currently working through submitted taxpayer income self assessment tax returns to pull out the average of a sole trade’s profits over the last three years; this covers tax returns submitted for the dates 2016/17 through to 2018/19. Up to 80% of this calculation will be payable in June, for a total of three months (March, April and June) of up to £2,500 a month. Taxpayers cannot apply for this, as it is an automatic process, and can only wait for HMRC to get in touch regarding income support. The medium of contact is not disclosed but it likely that taxpayers will receive a postal letter rather than an email or a text.
Delay to Making Tax Digital (MTD)
VAT Return submissions for the quarters have been delayed by 3 months due to the COVID-19 outbreak, as per news articles last week. Now, HMRC have announced that the rules for compulsory digital submissions for all VAT Returns will be pushed back until next year.
Apply for Self Employed Income Support
At 5pm, on the 27th March 2020, the Chancellor announced the details of the Self Employed Income Support which is a package to aid self-employed individuals with funding through the COVID-19 isolation period. Up to 80% of profits (up to £2,500 a month) will be given as a grant to those who apply, and unlike the Universal Credit this is not a per-household grant and neither does it take the amount of a person’s savings into account. For those who have self-employment work and a PAYE job, they will be eligible if more than 50% of their income is earned through their self-employment.


Need help?

Get in touch and see how we can help you