With the recent announcement in the pre-budget report, they mentioned that capital allowances will be increasing in January 2013. I am looking to buy a tractor shortly so should I wait until then?
The Chancellor announced an increase in the Annual Investment Allowance (AIA’s) to £250,000 from the 1st January 2013. AIA’s are the 100% tax reliefs you can claim on plant & machinery (equipment) and this had previously been set at £25,000. The timing of your purchase will depend on your financial year end. As most farms have a 31st March / 5th April year end then your AIA claim will be split as follows: April 12 to Dec 12 - £18,750, Jan 13 to Mar 13 - £62,500. Therefore you’ll need to ask yourself 3 questions, firstly how much have I spent so far this year on machinery, what is the cost of the tractor and what are your likely profits for the year. Your accountant or advisor should be able to assist you further with this so that you make the right decision.
I’ve read that as an employer HMRC are introducing a new way of reporting PAYE – called Real Time Information RTI. What will I need to do?
From April 2013, employers will be legally required to report PAYE in real time. This means that information about all PAYE payments needs to be submitted to HMRC online each time a payment is made as part of the payroll process, rather than at the end of the year as they are now. This will unfortunately create more work for you through the year, but it allows HMRC to keep more accurate records when they deduct tax from your salary.
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