Tax E-News – February 2025

Welcome to the February 2025 edition of Tax E-News. We hope that you find this informative. Please contact us if you wish to discuss any matters in more detail.

February 2025

THERE’S STILL TIME FOR SOME YEAR END TAX PLANNING!

With the tax/financial year end approaching, now is a good time to check that you’re making the most of the available reliefs and allowances available to you. Please talk to us if you think any of the issues affect you.
Savings
If you have some spare cash, an obvious tax planning point might be to maximise your ISA allowances for the 2024/25 tax year (currently £20,000 per person) […]

Pension Planning
You might also want to consider increasing your pension savings before 5 April 2025.
Under the current rules, the government adds to your pension contributions at the 20% basic rate. For instance, if you save £4,000 in a personal pension, the government tops this up to £5,000. If you are a higher rate taxpayer there is a further £1,000 tax relief when your tax liability is calculated, reducing the net cost to £3,000 […]

Capital Allowances
Unless the business year end is 31 March or 5 April, the end of the tax year is not a significant date as far as capital allowances are concerned. In order for new equipment to attract capital allowances, the expenditure must be incurred on or before the end of the accounting period […]

Capital Gains Tax (CGT) Planning
You might wish to consider bringing forward capital gains to before 6 April 2025 if you haven’t used your £3,000 CGT annual exemption for 2024/25 […]

Paying Voluntary National Insurance Contributions
A retiring person needs to have 35 ‘qualifying years’ in order to claim the full state pension. For those with gaps in their record, usually due to not paying sufficient National Insurance Contributions (NICs), it is possible to ‘plug’ those gaps by paying Class 3 (Voluntary) NICs at £17.45 per week […]

Stamp Duty Land Tax
Stamp Duty Land Tax (SDLT) applies to purchases of property in England and Northern Ireland. The following SDLT nil-rate thresholds are set to revert to their previous levels from 1 April 2025, so if possible, accelerating a completion date could be worthwhile […]

Furnished Holiday Lettings
As covered in previous editions of this newsletter, Furnished Holiday Letting (FHL) status will be abolished from 6 April 2025. This will mean an end to the beneficial tax treatment that has been enjoyed by FHL owners up to now […]

AVOID ANY DOUBLE CAB ‘HICCUPS’!

HMRC has published new guidance regarding a change in the interpretation of how Double-Cab Pickup (DCPU) vehicles should be classified for car benefit, capital allowances and some deductions from business profits purposes. Previously, HMRC accepted that if the payload of a DCPU was 1 tonne or more, it was a goods vehicle, not a car, and therefore qualified for beneficial capital allowances and benefit in kind treatment […]

EMPLOYMENT EXPENSES

It is possible to claim Income Tax relief on eligible employment expenses that have not been reimbursed by your employer. If you file a self assessment tax return, relief must be claimed on the employment pages, but for employees who do not file a self assessment, it is possible to claim tax relief using an online form (P87). This follows a period during which HMRC had temporarily suspended the online form process due to a high number of ineligible claims being made […]

VAT ON FOOD AND DRINK

In 2024 we saw a lot of legal cases that examined the VAT rating of food and drink and it appears this trend is continuing into 2025! The VAT rating of food and drink has always been a contentious topic but in the case of Global By Nature Ltd v HMRC (TC09396) we can see the first time that a tribunal or court has examined the VAT law covering ‘sports drinks’.
VAT legislation allows food and drink (other than catering) to be zero-rated […]

DIARY OF MAIN TAX EVENTS

FEBRUARY  / MARCH 2025