Printed on paper produced using wood fibre and manufactured at a mill that has been awarded the ISO14001 and EMAS certificates for environmental management. One of the few surviving measures from the Kwasi Kwarteng ‘mini-Budget’ in September was the winding back of the increases to NICs introduced in April 2022. The change, awkwardly appearing seven months into the tax year, will affect financial planning mathematics: Bonus timing If you are a director, your NICs are calculated on an annual basis, rather than the monthly basis which applies to most employees. All other things being equal, that means you and your employer pay fewer NICs if any bonus is paid in 2023/24 rather than 2022/23. However, special rules about the deemed payment date of director’s bonuses could prove an obstacle. Bonus or dividend? The NIC rates drop has reduced the tax-effectiveness of dividends relative to salary, although for now dividends remain generally the preferable option. If your company’s profits exceed £50,000 the picture will change from April 2023 because of the increases to corporation tax above that threshold and the Autumn Statement’s dividend allowance cuts. Salary sacrifice Salary sacrifice is a popular way of paying pension contributions because it saves both the employee’s and employer’s NIC liability on the amount sacrificed. Lower NIC rates make that NICs saving less but the option is still an attractive one, especially if you are a basic rate taxpayer. Company or self-employed? Increased corporation tax rates and lower NICs (the maximum self-employed rate is 9% in 2023/24) will tilt the scales against incorporating at high profit levels. The unchanged off-payroll working rules also limit the appeal of incorporation. If you need more detailed and personalised information on your options please contact us. B The Financial Conduct Authority does not regulate tax advice. Tax treatment varies according to individual circumstances and is subject to change. The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investing in shares should be regarded as a long-term investment and should fit with your overall attitude to risk and financial circumstances. For specialist tax advice, please refer to an accountant or tax specialist. Occupational pension schemes are regulated by The Pensions Regulator. 8 BUSINESS Untangling NICs developments The change to national insurance contributions (NICs) that took effect in November may have consequences for your financial planning. 8 King’s coins released The first coins featuring the new King will be in circulation from December. The new 50p piece will feature King Charles III, with the reverse a replica of the image used on coins to celebrate his mother’s coronation in 1953. As is traditional King Charles will face the opposite way to Queen Elizabeth II’s profile. The Royal Mint will issue 9.6m of these new 50ps and begin work on other coins featuring the new monarch. Premium bond boost Good news for premium bond holders: National Savings & Investment (NS&I) will be giving away more £50 and £100 prizes in their monthly draw. Previously the smallest £25 prize accounted for 98% of all payouts – but this will now drop to around 70%. These changes to the prize-fund ‘rate’ mean that with ‘average luck’ bond holders should get a return of 2.2%, up from 1.4%. Meanwhile the odds of any premium bond winning a prize have shortened from 24,500-to-one to 24,000-to-one. Get ahead on selfassessment Over 12 million of us need to file selfassessment tax returns by 31 January 2023. Any outstanding tax due for the year April 2021 to April 2022 needs to be paid by this date too. Those filing late face a £100 penalty and interest charged on tax owed. Last year’s Covid-related extensions have now been removed. First time users need to register for the service at least 20 days in advance of the deadline. It is advisable to file earlier if possible, as last year more than 50,000 people were trying to file their return between 4pm and 5pm on the deadline day. NEWS ROUND UP Credit: Rustically /Shutterstock.com Credit: fizkes/Shutterstock.com Tailored Retirement & Investment Planning Ingram House 6 Meridian Way Norwich NR7 0TA t: 01603 952300 f: 01603 952305 e: enquiries@tripifa.co.uk w: www.tripifa.co.uk TRIP is a trading style of Tailored Retirement & Investment Planning Ltd which is authorised and regulated by the Financial Conduct Authority.
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