Warrener Stewart joins the IRS Acceptance Agent Program

17 December 2015 • US Tax returns

Warrener Stewart’s head of Tax, Damian Talbot, has recently become an Authorized Acceptance Agent licensed by the American tax authority, the IRS, to help non-residents apply for their individual tax numbers. The US tax system can be complicated. Anyone who is not an American citizen, but is still required to file US tax returns as an ‘alien’, must have an Individual Taxpayer Identification Number (ITIN).

Damian, who is also an EA (Enrolled Agent), decided to undertake the necessary additional training to become an Acceptance Agent to be able to offer clients a more extensive US Tax Service.

Commenting on his latest qualification he said; “Warrener Stewart has a number of clients whose personal and business tax affairs come under either the UK or US tax systems.  As an Enrolled Agent I was able to represent taxpayers but only if they already had their ITIN. Now we can offer a complete service for individuals who are new to filing US tax returns.”

 

Two accountants choose Warrener Stewart to develop their careers

02 December 2015 • Warrener Stewart News

Warrener Stewart is delighted to have recruited two new people to join the accountancy team; Anita Desai ACCA and Alex Eagle ACA.  Both have already qualified as accountants and chose Warrener Stewart having worked in other practices since they wanted to become more involved with clients and help them achieve their business aims.

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Following a degree in Accounting and Finance Anita, decided to become a qualified accountant. Having worked with clients in the media and entertainment industry she was keen to expand her knowledge of business by moving to a practice where she could develop a more analytical and client facing role.

Similarly, Alex having completed his training as a Chartered Accountant with a medium sized firm wanted to take on a more hands on role. Alex has first hand experience of working with a broad range of clients dealing with audit and accounts assignments at all levels. His move to Warrener Stewart will allow him to build a portfolio of clients to work closely with, while assessing and analysing their needs to ensure they reach their business goals.

Commenting on their appointment, Colin Edney said; “We are delighted to welcome Anita and Alex to our ever growing team. Both have a wealth of experience that our clients will directly benefit from.

One of the key things that we pride ourselves upon at Warrener Stewart is our partnership with clients, providing a vital link between a set of financial accounts and their financial goals. To do this means adopting a more joined up approach to accounting and finding candidates who have a desire to look beyond the numbers! In Anita and Alex we have found two very capable accountants with great business skills.”

 

Warrener Stewart Celebrates Autumn Statement Event

30 November 2015 •

With George Osborne’s 2015 Autumn Statement hitting the headlines on Thursday, 25th November, it seemed the perfect opportunity for the team at Warrener Stewart to discuss the topic of tax with our clients.
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The evening was very well received, and a big thank you for the representatives from Grifco, Plena Capital, Le Bureau, Woodfords Solicitors, Cumberland Place, Painsmith, Templar Financial Planning and Quickfire Films Limited who were in attendance. All in all, it was a successful evening for Warrener Stewart and the tax team. 

Warrener Stewart's Response to the 2015 Autumn Statement

26 November 2015 • Warrener Stewart News

Today’s Autumn Statement was almost entirely devoid of changes to the tax system – a welcome respite following the myriad of new measures announced in the Budget this summer. There were however a few important announcements today, which should not be overlooked.

SDLT and Property

The most significant change was a further squeeze on buy-to-let landlords – this time, through a surcharge on SDLT. From 1 April 2016, the purchase of buy-to-let residential property will attract a 3% surcharge over and above the usual rates of SDLT. Together with the abolition of the 10% “wear & tear” allowance also taking effect next April, and the proposed restriction on mortgage interest relief from April 2017, this presents a three-pronged tax attack on private landlords.

The 3% SDLT surcharge will also apply to purchases of second homes (“additional residential properties”) from 1 April 2016 onwards.

It is proposed that corporate landlords and property investment funds which own 15 or more residential properties will be exempt from the 3% surcharge, although this is subject to policy consultation.

From April 2019, where capital gains tax is due on the disposal of a residential property, payment of the tax will be due within 30 days of completion. This is a significant change from the current Self-Assessment system, under which individuals have up to 22 months until CGT is payable, depending on the time of year of the disposal.

Tax on Dividends

Although nothing new was announced today, we would like to re-highlight the major changes to the taxation of dividends announced at the Budget. The rates of tax applicable to dividend income will increase by 7.5% at all income levels from April 2016, although this is mitigated to a certain extent to a new £5,000 tax-free allowance for dividends.

Individuals with substantial dividend income – in particular shareholders of owner-managed companies – should start planning their profit-extraction strategy as soon as possible, in order  to mitigate the impact of these changes.

Inheritance Tax

In a U-turn to policies announced before the general election, the Government has confirmed that no restrictions will be introduced on how ‘deeds of variation’ are used.  This valuable IHT planning tool therefore remains available going forward, although the Government has said it will continue to monitor their usage.

If you would like to explore what today’s Autumn Statement could mean for you and your business, please call 020 7731 6163 to talk to one of our tax team. You can also download our updated 2015 / 2016 tax card.

An evening with the Tax Team - Discussing the Autumn Statement

19 November 2015 •

Warrener Stewart’s tax team will be hosting an evening event at the Fulham Broadway Bar and Grill on Wednesday, 25th November to review the Chancellor’s Autumn Statement.

The evening event will allow clients and contacts of Warrener Stewart to discuss with the tax team how, if any, of the changes that Mr Osborne announces in his statement, might affect them or their business.

“This is a fantastic opportunity to mull over the day’s events,” says Damian Talbot, head of tax at Warrener Stewart. “Our tax team are normally inundated with calls from clients following any announcements from the government about tax issues. By holding an evening event, this will allow us to discuss in detail anything that immediately concerns them.”

The event, to be held in the Members Lounge, starts at 6pm when canapés and drinks will be served until 8.30pm. Anyone wishing to be included on the guest list should email Felicity Butler.

Update on the changes to the taxation of dividends

20 October 2015 • Tax Videos

Radical reforms to the dividend taxation system were introduced in the July 2015 budget which will take effect from the 6th April 2016. The most important effect is that the effective tax rate will increase by 7.5% across all bands. To illustrate, effective tax rates before, and on or after this date will be as follows;

  Old Regime - Nominal Old Regime – Effective New Regime
Basic Rate 10.00% 0.00% 7.50%
Higher Rate 32.50% 25.00% 32.50%
Additional Rate 37.50% 30.60% 38.10%

There are however two favourable changes.

  • Firstly the tax credit system is being abolished which means the end of ‘grossing up’. This system is why under the old regime, £9,000 of dividends actually counted as £10,000 for tax purposes. The practical effect of this change is that thresholds and bands will now be approached and crossed more slowly for a given level of physical distribution.
  • Secondly there is going to be a new tax free £5,000 dividend allowance which means that the first £5,000 of dividend income is effectively zero rated within whichever band it happens to sit.

Illustration 1

How someone with gross income of £100,000 will be affected

Say that a person with an owner managed business kept their gross income at £100,000 (so as not to lose their personal allowance). The old typical setup would have been to draw a salary of £8,000 with a net (i.e. ‘actual’) dividend of £82,800 (which translates to £92,000 grossed up – i.e. for tax).

We can see that in this case that the person would be £4780.37 worse off.

Illustration 2

Under the new regime however, the person might want to increase their dividends by £9,200 as with the abolition of ‘grossing up’, drawing £92,000 dividends would simply count as £92,000 for tax purposes. Therefore the person could physically receive £100,000 overall without starting to lose their personal allowance.

We can see that in this scenario the person would be £3,818.15 worse off. This is however a lower differential than the previous example.

Comparison of overall tax rates

We have developed a spreadsheet system which can test various scenarios, so if you think that these changes could affect you and your business, please call 020 7731 6163 to talk to one of our tax team. You can also download our updated 2015 / 2016 tax card.

 

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Diana Hoare - Anderson Hoare