Changes to the National Minimum Wage from 6 April 2009

The National Minimum Wage (NMW) rules have been with us for some years and require minimum rates of pay for certain workers. The government is now getting tough with those who do not pay the NMW.
From 6 April 2009, a new automatic penalty will be raised on employers where HMRC find NMW arrears. Penalties will range from £100 to £5,000 in addition to any arrears of pay owed to the workers. The most serious cases could lead to a criminal sentence or an unlimited fine.
Several changes are also being made to the powers of investigating officers such as the ability to remove NMW records from an employer’s premises.
To read more about the NMW rules please see the links below.
Internet links: HMRC - National Mimimum Wage www.berr.gov.uk

Inside this issue:

Tax Allowances: Rob Ayley outlines some areas of tax interest
Changes to the minimum wage: Are you up-to-date?
Nuisance claims: Find out the facts, fast.

Wealth Creation Specialist - April 2009 Newsletter

LANDOWNERS BEWARE OF NUISANCE CLAIMS

Any landowner intending to change the use of a property to a use that might constitute a nuisance must bear in mind that obtaining planning permission for the use and using the property strictly in accordance with the conditions of that planning permission and any section 106 agreement entered into as a condition of that permission does not preclude neighbours from making claims against the landowner for nuisance. The risks that you run if you are found by the courts to be liable for nuisance are that you may be ordered to pay damages and have an injunction issued against you restricting your use of the property. This was recently illustrated in the case of Watson v Croft Promo-Sport Ltd where the Court of Appeal held that the noise arising from a motor racing circuit constituted a nuisance for the owners of private homes on land adjoining the circuit and, in addition to an award of damages made by the High Court compensating the neighbours for the decrease in value of their homes as a result of the noise, the Court of Appeal granted an injunction requiring the owners of the circuit to reduce their activities to their core uses.

The contents of these articles represent the opinions of the authors, and not of Professional Solutions Group Ltd. Neither Professional Solutions Group Ltd nor Tenet Connect Ltd. are responsible for the accuracy of the content of the articles. These articles do not constitute a recommendation to purchase any of the products mentioned.

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Tax Allowances

Broadly speaking you have the following allowances which are usually subject to some change following the Budget each year:

* Personal Allowance
The amount you can earn before you pay any Income Tax is worked out for you if you are employed and by submitting a tax return if you are self employed. You should always check you have not been given the wrong Tax Code. Your employer or tax adviser should be able to help you do this.

* Tax Credits
Available to those on lower incomes with children, this effectively increases the above and is paid as a cash sum. Your employer should be able to help you with this.

* Capital Gains Tax Allowance
This is the amount of profit you can make on the sale of an investment before you pay any tax and often goes completely unused.

* Age related Allowances for the over 65’s
This operates in the same way as Personal Allowances with one important difference. If you earn more than a preset threshold you lose it at the rate of £1 for every £2 over the threshold which results in a band of income between £21,800 and £27,790 being taxed at 30%. Click here to speak to us about how you can avoid this trap.

* Individual Savings Account Allowance
You can invest in one of these and receive any income or growth completely tax free. However, most people concentrate on investing to use this allowance before thinking about how to use their Capital Gains Tax allowances first. Also, many people invest very cautiously, often into cash ISA’s and thus limit the ‘tax free’ benefit.

* Inheritance Tax Nil Rate Allowance
This is the tax free amount under which you can leave to your intended beneficiaries who survive you. Recent changes have made this a complex area in which gifts already made that were tax free could now be liable to tax on death.

* Enterprise Investment Schemes
You can claim Income Tax relief on contributions to qualifying schemes. If held for a number of years any gains are free of Capital Gains Tax.

* Venture Capital Trusts
You can claim Income Tax relief on contributions to qualifying schemes. If held for a number of years any dividends are free of Income Tax.

* Pension contributions
You can receive Income Tax relief up to your highest rate of tax on your savings by investing here. Click here to speak us to about how you can use your allowance.

And for Limited Companies:

* ‘Income shifting’
The mechanism where by you share your dividend income with a spouse who is a co-shareholder. This keeps many business owners from paying Income Tax at the highest rates. HMRC have this under review so click here to speak to us about how this might affect you now.

* Capital Allowances
This allows the offsetting of the cost of reinvesting profits back into your business through the purchase of ‘plant and machinery’. Click here to speak to us about how you can discover what qualifies.

* Entrepreneurs Relief
A new relief that allows you to sell your company for up to £1m whilst paying an effective rate of 10% in tax. Speak to us about how you can qualify.