HMRC issues reminder of saving scheme
Help to Save (HTS) has been around for five years. In a recent press release, HMRC has revealed the level of bonus payments paid out to participants and encouraged others to look at using the scheme. So how does it work?
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Accounting for VAT if there is no cash payment
Your business has submitted repayment returns for the last two quarters and you are concerned that you might have underpaid output tax on some supplies where no money has changed hands. Are your concerns justified?
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Treatment of distributions under review
The government has launched a consultation on modernising the tax treatment of distributions and repayments of capital by companies. The proposals could affect the distinction between dividends taxed as income and capital payments subject to CGT. What changes are being considered?
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Tax relief on equipment you haven’t paid for (yet)
The timing of tax relief for purchases of equipment isn’t straightforward when payments are delayed or goods are purchased through hire purchase (HP) agreements. How can you use these rules to your advantage and get tax relief before you’ve paid the final invoice?
In the press release, HMRC confirmed that £146 million in bonus payments have been received by savers since the HTS scheme launched in 2018. Over 450,000 people have a HTS account.
The scheme is available to those on lower incomes, and pays an attractive 50% bonus, subject to a maximum of £1,200 over four years.
You could be eligible to open a HTS account if you are receiving:
- Working Tax Credit
- Child Tax Credit and are entitled to Working Tax Credit
- Universal Credit and they (with their partner, if it is a joint claim) had take-home pay of £722.45 or more in their last monthly assessment period.
Once the account is open, you can deposit between £1 and £50 each month, with the government topping up the deposits in the second and fourth years. It is possible to accumulate £2,400 in qualifying savings to attain the maximum bonus of £1,200.
HMRC has also produced a helpful video with further information on HTS.
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