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Author Archive: Muhammad Zia
Could a Family Investment Company help you manage tax and protect wealth?
For individuals and business owners looking to preserve wealth for future generations while maintaining control over their assets, Family Investment Companies (FICs) are an alternative option to trusts.
Planning your exit? Watch out for the BADR changes
If you are thinking about selling your business, timing could be everything.
Business Asset Disposal Relief (BADR), formerly known as Entrepreneurs’ Relief, helps business owners reduce their Capital Gains Tax (CGT) liability when selling qualifying assets.
However, with adjustments to BADR coming in April 2025, it is important to make plans for an exit strategy sooner rather than later.
Current BADR rules and the upcoming change
BADR currently allows eligible sellers to pay a reduced CGT rate of 10 per cent on gains up to £1 million over their lifetime.
This is a substantial saving compared to the standard CGT rate of up to 24 per cent.
However, from April 2025, this preferential rate rises to 14 per cent, and from April 2026, it increases again to 18 per cent.
So, if you are a business owners considering a sale, should you bring forward your plans to lock in the lower tax rate?
Consider your options before a rushed sale
While selling before the rate rise may seem like a straightforward decision, there are other factors to consider:
- Is the market favourable?
- Is your business in the best possible position to attract buyers?
- Does the timing coincide with your personal financial goals?
Anti-forestalling rules also mean that certain transactions, such as share reorganisations, loan notes or sales to connected parties, could be caught under the new rates.
If you have structured a sale or disposal in recent years, you may need to review your position to avoid unexpected tax liabilities.
With the deadline fast approaching, you should act immediately.
Speak with our experts today for exit strategies and advice on the reliefs available to you.
Paying your employees will cost you more after 6 April
From 6 April 2025, changes to employer National Insurance Contributions (NICs) will take effect, increasing payroll costs for many businesses.
If you employ staff, it is advisable to prepare now for how these changes will impact you financially.
Here are the key numbers to keep in mind:
- Lower NICs threshold – Employers will start paying NICs at £5,000, down from £9,100.
- Higher NICs rate – The secondary Class 1 NICs rate will rise from 13.8 per cent to 15 per cent, increasing employer costs.
- Larger Employment Allowance – For eligible businesses, this will increase from £5,000 to £10,500, more than doubling the relief on their NICs liabilities.
- No more £100,000 cap – More businesses will now be able to claim the Employment Allowance, as the cap is being removed.
With these changes approaching, you should assess your payroll costs and plan to manage the financial impact on your business.
How will this affect your business?
Despite the Employment Allowance increase and the removal of the £100,000 cap, many businesses will feel the pinch in April. The changes are set to cause:
- Increased employment costs – The combination of a lower threshold and higher NICs rate means many employers will pay more.
- Greater strain on cash flow – Higher NICs liabilities may require businesses to adjust payroll budgets to manage rising costs.
- Limited relief for some businesses – While the increased Employment Allowance will help, it may not fully offset the additional NICs for employers with larger payrolls.
Understanding these impacts now can help you adjust your financial planning and ensure your business is prepared for the changes ahead.
Why you need to meet with your accountant before April
As the end of the tax year approaches, it is a good time to review your personal tax position and ensure you are making the most of available allowances.
Unlike company tax planning, which can take place throughout the year, personal tax is closely tied to the tax year-end on 5 April.
This makes early planning essential to avoid missed opportunities or unexpected tax liabilities.
Meeting with your accountant before key deadlines allows you to review your financial position and act on advice where needed.
The discussion will typically cover:
- Tax planning – Reviewing ways to manage your tax liabilities efficiently.
- Spending and saving plans – Ensuring your personal spending and use of assets align with your financial goals.
- Opportunities and risks – Identifying areas that may need attention before the tax year-end.
Having these conversations now will give you confidence and peace of mind that your tax affairs are in order before 5 April.
Key benefits of meeting your accountant before year-end
A pre-year-end meeting allows you to take a proactive approach rather than reacting to financial issues after they arise.
By reviewing your tax position, allowances, and financial commitments in advance, you can make changes that may not be possible once deadlines have passed.
Small adjustments ahead of key dates – whether for tax efficiency or future planning – can put you in a stronger financial position.
Exploring your tax relief options ahead of year-end
Meeting with your accountant ahead of deadlines gives you the chance to discuss tax-saving opportunities, including:
- Maximising personal allowances – Ensuring you make full use of your Income Tax personal allowance, savings allowance, and dividend allowance.
- Making pension contributions – Reviewing whether additional pension contributions before 5 April could reduce your tax bill.
- Using capital gains tax allowances – If you are planning to dispose of assets, considering timing to make the most of annual exemptions.
- Gift planning – Taking advantage of Inheritance Tax exemptions by making tax-efficient gifts.
- Planning for dividend and investment income – Ensuring your investments are structured in a tax-efficient way before the tax year-end.
By reviewing these tax relief options now, you can take advantage of available allowances and ensure you are in the best possible position for the new tax year.
Speak to us today to make sure you are fully prepared for your tax year-end.
Upcoming Inheritance Tax changes that could affect you
Upcoming changes to Inheritance Tax (IHT) will be phased in over the next two years.
With property values rising and the IHT nil-rate thresholds remaining frozen until 2030, more estates will face unexpected tax bills if they fail to plan accordingly.
While two years may seem like plenty of time to prepare, effective estate planning requires careful consideration and proactive action sooner rather than later.
- From April 2025 – A new residence-based system will replace the existing domicile regime. This change means that individuals who have lived in the UK for at least 10 of the last 20 years will be liable for IHT on their worldwide assets. Non-UK residents may still face IHT liabilities for up to 10 years after leaving the country.
- From April 2026 – Agricultural and Business Property Relief (APR and BPR) will be capped. From this date, 100 per cent relief will only apply to the first £1 million of eligible assets in an individual’s estate. Anything above this threshold will incur an IHT charge of 20 per cent. This change will have significant implications for family-run businesses and farming families.
- From April 2027 – Unspent pension funds, previously exempt from IHT, will become taxable. Inherited pension pots will be included in estate calculations, potentially pushing more families over the threshold, particularly as they remain frozen.
If you are unsure whether these changes will impact your estate planning, seek professional advice to help mitigate potential IHT liabilities and ensure your family assets remain protected.
Our experienced team can help you review your assets and pension arrangements, explore practical gifting options, and consider trust structures that suit your family’s needs.
Contact our team today for assistance minimising your IHT liabilities.
Time is running out to check for gaps in your State Pension!
If you have had career breaks, worked abroad, or earned below the National Insurance (NI) threshold, you could have gaps in your State Pension.
HM Revenue & Customs (HMRC) extended the deadline for voluntary NI contributions (NIC) to 5 April 2025, giving individuals an opportunity to fill gaps dating back to 2006.
After this date, any gaps between April 2006 and April 2019 will become permanent, potentially reducing your State Pension entitlement.
Here is what you need to know about qualifying periods for your State Pension:
- 35+ years of NICs = Full State Pension
- 10 to 35 years = You will receive a proportionate amount based on your contributions.
- Less than 10 years = Ineligible for any State Pension.
Each additional year of contributions could increase your pension by £328.64 annually, based on 2024-2025 rates, which could significantly improve your financial stability during retirement.
For non-working parents, there may be additional support available.
If you have taken time off work to care for children, you might qualify for Pension Credit or receive National Insurance credits through Child Benefit claims.
These credits can help protect your entitlement to the State Pension, so it is important to check whether you are receiving all the benefits you are entitled to.
From 6 April 2025, you will have only six years from the end of each tax year to fill any gaps in your National Insurance records.
For example, if you want to make contributions for the 2023/24 tax year, the deadline will be 5 April 2030.
What you should do next
Men born after 5 April 1951 and women born after 5 April 1953 should check their records immediately, as you may be eligible for the new State Pension.
You should not leave your retirement income to chance, and we advise you discuss future planning with your accountant at the earliest opportunity.
Check your NI record today via the Government’s online portal or contact our expert team for tailored advice on securing your financial future or boosting your State Pension before the 5 April 2025 deadline.
For help with your retirement planning or guidance on your State Pension, please contact our team.
Will Trump’s tariffs impact your business?
President Trump’s tariff proposals are creating uncertainty in global markets.
While the UK has not been directly targeted yet, British businesses could still feel the impact of U.S. trade policies.
Trump’s latest proposal to impose reciprocal tariffs on countries with value-added tax (VAT) systems, including the UK, could result in a 20 per cent tax on British exports to the U.S., primarily affecting industries like automotive, pharmaceuticals, and food and drink.
If you export goods to the U.S., it is time to review your relationships with your U.S. partners.
Consider renegotiating contracts or terms and assess how tariffs might impact pricing and demand for your products.
The UK’s strong ties with the EU mean that tariffs on European goods could also indirectly raise raw material and component costs for British businesses.
As supply chains become more unpredictable, UK companies may face inflationary pressures and operational challenges.
To mitigate these risks, consider sourcing materials from UK manufacturers or regions less likely to be affected by Trump’s tariffs.
This can reduce your reliance on European and U.S. suppliers, where disruptions and cost increases are anticipated.
Uncertainty around Trump’s trade policies has already led some businesses to delay investments and rethink their global business strategies.
Given that many details about potential tariffs remain unclear, staying updated on U.S. trade policies and adjusting your strategy to minimise the impact is crucial.
It is recommended that you develop contingency plans to protect your business in case tariffs are levied in future.
Contact us if you are concerned about how global trade disruptions could impact your business.
Rotherham Taylor welcomes Daniel Abram as it continues to support the next generation of accountants
Rotherham Taylor is delighted to welcome Daniel Abram to the team as a Trainee Accountant, reinforcing its commitment to developing the next generation of accountancy professionals.
Daniel joins the firm with a Master of Mathematics, bringing a strong analytical approach and a keen eye for detail to his role.
From the outset he has been assisting with bookkeeping, preparation of VAT returns and assisting with the compilation of accounts.
Rebecca Bradshaw, Director at Rotherham Taylor, said: “We are thrilled to welcome Daniel to the team. His strong mathematical background, attention to detail, and enthusiasm for learning make him a fantastic addition to our firm.
“At Rotherham Taylor, we are passionate about nurturing new talent, and we look forward to supporting Daniel as he develops his career and works towards becoming a fully qualified chartered accountant.”
Passionate about using his skills beyond the workplace, Daniel is involved on a voluntary basis with Ashton Food Aid, a local food bank, where he assists with bookkeeping, demonstrating his dedication to both his profession and his community.
“Rotherham Taylor is committed to fostering talent, and Daniel is already thriving in its collaborative and supportive environment. He is eager to develop his expertise, work with real clients, and progress towards his ambition of becoming a fully qualified chartered accountant,” added Rebecca.
The team at Rotherham Taylor is excited to support Daniel on his professional journey and looks forward to seeing him grow within the firm.
For more information about Rotherham Taylor and its commitment to training future accountants, please contact us.
Quick Guide: The end of the UK non-dom regime
From 6 April 2025, the UK’s non-dom tax regime will be abolished, marking a significant shift in the tax landscape for non-domiciled individuals and British expatriates returning to the UK.
This transition means that worldwide taxation will apply to all UK residents, ending the long-standing remittance basis and changing the way foreign income and gains are taxed.
Understanding these changes is essential for individuals who currently benefit from non-dom status.
This quick guide provides a breakdown of the key reforms, who they affect, and what steps you should take before the deadline.
Key changes at a glance:
- Worldwide taxation for all UK residents – From 6 April 2025, UK residents will be taxed on their global income and gains, removing the ability for non-doms to defer tax on foreign income by keeping it offshore.
- Abolition of the remittance basis – The option to be taxed only on UK income and any foreign income brought into the UK will no longer be available.
- Four-year foreign income & gains (FIG) regime – A tax relief scheme for those moving to the UK after ten years of non-residence. This allows certain individuals to claim relief on non-UK income and gains for up to four years.
- Capital gains tax (CGT) rebasing – Non-doms who have used the remittance basis between 2017/18 and 2024/25 may qualify for asset rebasing to 5 April 2017 values, reducing their taxable capital gains.
- Temporary Repatriation Facility (TRF) – A limited-time opportunity to bring offshore funds into the UK at reduced tax rates of 12 per cent in 2025/26 and 2026/27, and 15 per cent in 2027/28.
- Inheritance Tax (IHT) changes – A shift to a residence-based system from 6 April 2025, meaning domicile status will largely become irrelevant for IHT purposes.
Who will be affected?
These reforms affect a wide range of individuals, including:
- Current non-domiciled UK residents – Those who previously benefitted from the remittance basis will now be taxed on their worldwide income and gains.
- Returning expatriates – British nationals who have been non-UK resident for ten consecutive years may qualify for the FIG regime but will eventually be subject to full UK taxation.
- Wealthy individuals with offshore assets – Anyone holding significant foreign investments should consider the implications of CGT rebasing and the TRF.
- Individuals with offshore trusts – Trust structures may require review due to changes in how gains are taxed.
What you need to do now
With only a short time left before these changes take effect, proactive tax planning is crucial.
Here are the steps you should consider:
- Review your tax position – Assess how the end of the non-dom regime will impact your personal and financial situation.
- Assess offshore assets – Consider whether restructuring your wealth or making use of CGT rebasing could reduce tax liabilities.
- Plan repatriation – If you have offshore funds, determine whether the TRF provides an opportunity to remit funds at a lower tax rate.
- Consider relocating – If the UK’s new tax rules significantly increase your liabilities, you may wish to evaluate whether remaining in the UK is the best financial choice.
- Seek professional advice – Given the complexity of the changes, expert tax advice is essential to avoid unexpected tax bills and ensure compliance.
If you have concerns about these upcoming changes or require tax advice, please speak to our team today.
