Author Archive: Muhammad Zia

We’re moving to Onvio

Clients of Rotherham Taylor will soon receive an invitation to join Onvio, our brand new client portal. Onvio will replace Virtual Cabinet as the way we share and receive information securely with our clients. We believe the new system will benefit you in many ways!

  • Two-way sharing of information, making it easier for you to upload documents like bank statements at the click of a button without worrying about the safety of the content.
  • Shared space to retain information for future reference, so you can store your tax returns and accounts in a secure space and access them whenever you need to.
  • Year-end tax return information requests become easier, as you’ll be able to enter details directly onto the checklist we send you, rather than collating data to send into the office.
  • Facility to electronically sign more documents, reducing the need for postal communications.
  • Accessible by an app as well as through the cloud, so you can access your documents wherever you are.
  • Reducing the amount of paper used will have the benefit of reducing our carbon footprint.

We understand that not everyone wants to communicate by paperless technology, and that’s okay! For those clients who prefer our existing methods of communication, they will remain in place. If you have any queries or concerns about the process, please don’t hesitate to contact Ian@rtaccountants.co.uk or Rebecca@rtaccountants.co.uk for more information or to discuss any impact the change will have on you.

To help you get started with Onvio, we’ve included a link to a guide that you may find useful:

We’re excited to introduce you to Onvio and believe it will make managing your accounts and tax even easier.

How does the Residence Nil-Rate Band impact Inheritance Tax?

Inheritance Tax (IHT) can be a significant expense for families transferring wealth to the next generation. But with careful tax planning and by considering your options, you can reduce the tax burden on your family.

When is IHT due?

When someone passes away, their estate may be subject to IHT if it exceeds the tax-free threshold of £325,000 (currently frozen until April 2028), this is called your nil rate band.

If the residence nil band applies this can increase the tax-free threshold by £175,000 to £500,000.

The value of your estate includes various assets such as property, investments, and savings.

If the value of the estate surpasses the nil rate bands, the IHT rate of 40 per cent will be applied to the excess amount.

If you are married or in a civil partnership and your partner passes away, any unused IHT allowances can be passed to you.

If you suspect that your estate will be subject to IHT, it’s essential to understand the costs involved and explore ways to plan ahead and minimise the impact of these costs.

The Residence Nil-Rate Band explained

Firstly, you must have lived in the property at some point. Additionally, the property must be left to a direct descendant, such as a child, grandchild, stepchild, adopted child, or foster child.

If you leave your entire estate to your spouse, you may not make use of your own nil-rate band. Instead, your spouse’s tax-free allowance will double to £650,000.

Similarly, if the residence nil rate band is not used, your spouse’s allowance will be increased to £350,000 – allowing a total tax-free allowance of £1 million.

If the value of your estate exceeds £2 million, the additional allowance will taper, the allowance decreases by £1 for every £2 that your estate exceeds £2 million.

We understand that the value of your estate and ensuring it is passed down to your loved ones is of the utmost importance. We are here to guide you through the process and answer any questions you may have.

How to plan for IHT

One of the most critical considerations in succession planning is timing. It’s essential to plan well in advance, as this will give you time to make the most of any available tax reliefs and exemptions.

At Rotherham Taylor, we can provide ongoing IHT advice and identify any available tax reliefs, to take the weight off your shoulders.

If you need advice on IHT or probate-related matters, contact us today.

Fuel rate boost for electric car drivers, but other advisory fuel rates cut

Company car drivers will see changes to the amount they can claim back for fuel costs from their employer from 1 March.

HM Revenue & Customs (HMRC) has also confirmed that the way the advisory electricity rate (AER) is calculated has been changed to better reflect energy prices, particularly with soaring electricity costs, when it is reviewed quarterly.

Previously it has been based solely on an annual figure published by the Department for Business, Energy & Industrial Strategy (BEIS), and the electrical energy consumption values for each car model, provided by the Department for Transport (DfT).

Quarterly index

HMRC will continue to use the BEIS and DfT data but will now also incorporate figures published in the Office for National Statistics (ONS) quarterly index for domestic electricity.

The new rates include a 1 pence per mile (ppm) increase in the advisory electricity rate (AER) used to reimburse drivers of electric company cars.

In contrast, and to reflect falling fuel prices, petrol, diesel and LPG advisory fuel rates (AFRs) have been reduced from 1 March.

Rates cut for petrol and diesel

The rates for petrol company cars have all been cut, with the AFR for petrol vehicles up to 1,400cc now 13 ppm.

Vehicles powered by 1,401-2,000cc engines see a decrease of 2 ppm, to 15 ppm. For engines larger than 2,000cc the AFR sees the biggest reduction of 3 ppm, to 23 ppm.

For diesel, cars up to 1,600cc there is a reduction of 1 ppm, to 13 ppm, and engines from 1,601-2,000cc see a reduction of 2 ppm to 15 ppm. The 2,000cc rate is cut by 2 ppm to 20 ppm.

For LPG vehicles up to 1,400cc, the rate remains the same at 10 ppm but has been cut by 1ppm to 11ppm for vehicles with an engine size of 1,401-2,000cc. For engines greater than 2,000cc, there is also a reduction of 1 ppm to 17 ppm.

Hybrid cars are treated as either petrol or diesel cars for AFR purposes.