Welcome to the first blog post of the year on Bernard Tierney & Company’s website! As we start a new year, it’s important to stay informed about the latest developments in UK tax law. In this post, we’ll provide a summary of the most significant changes that may affect your business or personal finances in the coming year.
One of the most significant changes in UK tax law in recent years has been the introduction of the Making Tax Digital (MTD) initiative. This new system, which began rolling out in April 2019, requires businesses with annual turnover above the VAT threshold to keep digital records and file their VAT returns using compatible software. As of April 2022, the MTD will be mandatory for businesses with turnover above £10,000.
Another important change for businesses is the increase in the National Living Wage and National Minimum Wage. From April 2021, the National Living Wage will increase from £8.72 to £8.91 per hour for workers aged 23 and over. The National Minimum Wage will also increase for workers under 23.
For individuals, the personal allowance – the amount of income you can earn before paying income tax – will increase from £12,570 to £12,570 in the 2021-22 tax year. Additionally, the basic rate limit will increase from £37,700 to £37,700, which means that the higher rate threshold will increase from £50,270 to £50,270.
Another important change is the introduction of the Digital Services Tax (DST) in the UK, which will apply to certain revenues generated by certain digital businesses from April 2021. The DST is intended to ensure that large digital businesses pay their fair share of tax in the countries where they generate revenue.
In Northern Ireland, the Land and Buildings Transaction Tax (LBTT) will be replaced by the stamp duty from April 1st 2021. This will be a major change in the tax law in Northern Ireland and will have a significant impact on the housing market.
These are just a few of the key changes in UK and Northern Ireland tax law that may affect your business or personal finances in the coming year. At Bernard Tierney & Company, we are committed to staying informed about the latest developments and providing our clients with the guidance they need to navigate the complex world of taxes.
If you have any questions or concerns about how these changes may affect your business or personal finances, please don’t hesitate to contact us. We are here to help.