Influencers

This year brings several significant tax adjustments, which could affect both individuals and businesses. Key Tax Changes Effective 6 April 2025 1. Employer National Insurance Contributions (NICs): - The rate for employer NICs has increased from 13.8% to 15%. - The threshold at which employers begin paying NICs has decreased from £9,100 to £5,000. This means businesses will incur higher employment costs, potentially influencing hiring decisions and wage structures, ultimately affecting employees. 2. Employment Allowance - This is an allowance against employers NI and has increased from £5,000 to £10,500. - It is also open to more employers as you can now claim if your employer NI in the previous year was over £100,000, however, you’re still unable to claim if the only person on the payroll is a director. 3. National Minimum Wage (NMW): - NMW increased from 1 April 2025 to £12.21 per hour for those aged 21 and over, £10.00 for those aged 18-20 and £7.55 for under 18’s or apprentices. 4. Stamp Duty Land Tax (SDLT): - The temporary reductions in SDLT stopped on 31 March 2025 so new purchases will be at the higher rates. 5. Business Asset Disposal Relief (BADR): - BADR is a reduction in capital gains tax for sales of business or company shares (where you’re an employee or director) – various criteria apply. - The rate has increased from 10% to 14%. 6. Non-Domiciled ('Non-Dom') Tax Status Abolition: - The government will abolish the non-dom tax regime, which previously allowed certain residents to avoid UK taxes on foreign income. This change may influence the residency decisions of high-net-worth individuals and could have broader economic implications. 7. Late Payment Interest Rates: - HMRC will increase interest rates on late tax payments to 8.5%, effective from 6 April 2025. This adjustment aims to encourage timely tax payments and ensure fairness among taxpayers. 8. ISA’s - Although nothing has been announced yet, HMRC are looking at potentially reducing the ISA allowances later in the year. Tax Rates and Thresholds The income tax rates and thresholds remain unchanged from previous years rather than increasing in line with inflation which means that people pay more tax as their incomes increase. This is known as fiscal drag. Implications for Taxpayers The combination of these tax changes and the effects of fiscal drag underscore the importance of proactive financial planning. Individuals and businesses should: Review Financial Plans: Assess how the new tax rates and thresholds impact your financial situation and adjust budgets accordingly. Seek Professional Advice: Consult with tax professionals to explore strategies that mitigate increased tax liabilities, such as tax-efficient investments or restructuring income. Stay Informed: Keep abreast of tax legislation changes to ensure compliance and optimize financial decisions. At CJL Accountancy, we are committed to guiding you through these changes and helping you navigate the complexities of the evolving tax landscape. For personalised advice and support, please contact us.

Building upon previous initiatives, the Chancellor introduced a series of robust measures aimed at closing the tax gap. Enhanced Investment in HMRC The government plans to invest further in HM Revenue & Customs (HMRC), focusing on advancing cutting-edge technology and expanding HMRC's capacity to tackle tax avoidance more effectively. The objective is to increase the number of tax fraud prosecutions by 20%, which is projected to raise an additional £1 billion annually by 2029-30. Consultation on New Anti-Avoidance Measures In a move to further tighten the noose on tax avoidance, the government has launched a consultation titled "Closing in on Promoters of Tax Avoidance." This initiative seeks public and professional input on proposed measures that would grant HMRC additional powers and impose stronger sanctions on those promoting tax avoidance schemes. The goal is to disrupt the business models of the few remaining promoters and contribute to reducing the tax gap associated with marketed tax avoidance. Implications for Taxpayers and Advisors These developments signal a clear message: the government is intensifying its efforts to ensure compliance and fairness within the tax system. Taxpayers and their advisors should be vigilant and proactive in understanding these changes to avoid inadvertent non-compliance. Engaging with professional advisors who are abreast of the evolving tax landscape is more crucial than ever. Conclusion If you’re looking for peace of mind then book a call with CJL Accountancy; we can help you stay compliant.

Rates and Thresholds for 2025/26 Most of the tax rates and thresholds for 2025/26 are the same as for 2024/25 with a couple of changes: National Insurance Lower Earnings Limit increased to £6,500 – if you have earnings above this then the year counts towards state benefits including state pension National Insurance Secondary Threshold reduced to £5,000 – this is the point where your limited company begins paying national insurance Employers National Insurance rate increased to 15% – your limited company will pay 15% of your salary above £5,000 in employers NI (the employers national insurance rate for benefits in kind is also increased to 15%) Employment Allowance increased to £10,500 – this allows eligible employers to reduce their employers NI liability by up to £10,500 Considerations: National Insurance Contributions - a salary above £6,500 ensures you receive a qualifying year for state pension purposes. Company Profitability - dividends can only be paid from distributable profits. Ensure your company has sufficient profits before declaring dividends. Employment Allowance Eligibility - generally, companies with more than one employee or those paying NI on employees' earnings may qualify. Single-director companies without additional employees do not qualify. Tax-Free Childcare – there are income requirements to qualify for this Pension Contributions – you can only make personal pension contributions up to your UK relevant earnings (up to the annual allowance) so if your salary is low, your tax-efficient pension contributions will also be low. However, employer pension contributions are only restricted to the annual allowance, not your UK relevant earnings. Recommended Salary and Dividend Strategy A common tax-efficient approach involves drawing a combination of salary and dividends. This method leverages the personal allowance and typically results in lower NI contributions. The level that’s most tax-efficient for you will be dependent on your personal and company circumstances. Contact us to discuss the best solution for you and your business.

Whether you're self-employed, an influencer, a small business owner, or running a limited company, a few strategic moves could reduce your tax bill and improve your financial health. Here are some essential tax planning tips to consider before the deadline. Maximise Your Allowances Each tax year, you’re entitled to various tax-free allowances, and if you don’t use them, you lose them. Some key allowances to consider: Personal Allowance – the first £12,570 of your income is tax-free. Ensure you’re making full use of it, especially if your income fluctuates. Dividend Allowance – if you receive dividend income, the first £500 is tax-free. Check out our previous blog about tax-efficient director salaries and dividends for more information. The Trading Allowance gives £1,000 of tax-free gross income per year from self-employment and the Property Allowance gives £1,000 of tax-free gross income per year from rentals. If you let a room in your home, up to £7,500 per year can be received tax-free. There is also a Capital Gains Tax (CGT) Allowance – you can make up to £3,000 in capital gains tax-free before the allowance resets. If you’re planning to sell assets, consider doing so before the new tax year. Make Pension Contributions Pension contributions benefit from tax relief whether made by you personally or by your employer/limited company. Check out our previous blog about pension contributions for more information. Boost Your State Pension You can pay voluntary National Insurance contributions to fill gaps in your record to boost your qualifying years that are used to calculate your State Pension entitlement. Claim Employment Expenses As an employee there are a few tax reliefs that can be claimed against your employment income if your employer hasn’t re-imbursed you: Professional subscriptions Working from home allowance – only where your employer requires you to work from home, not where you choose to Business miles travelled in your own vehicle Uniform allowance for specific jobs Claim All Allowable Business Expenses If you’re self-employed or running a business, ensure you’ve claimed all eligible expenses, including: Home office costs Business travel and subsistence Equipment and software Marketing and advertising expenses Check out our previous blogs about costs you can claim for more information, for influencers here , landlords here and others here . Invest in Business Equipment Before Year-End Purchasing business-related equipment (such as a new laptop, camera, or office furniture) before your business year end means you can deduct the cost from your taxable profits for the current year, speeding up your tax relief. Marriage Allowance If one party to the marriage/civil partnership is a basic rate taxpayer and the other has income below the personal allowance, it’s worth considering whether to apply for marriage allowance. This transfers 10% of the non-taxpayer’s personal allowance to their spouse which saves up to £252 in tax. Check Your Tax Code Many people overpay tax due to incorrect tax codes. If you’ve changed jobs, gone self-employed, or received benefits like a company car, it’s worth checking your tax code via HMRC’s website. Use Your ISA Allowance If your interest income is above your personal savings allowance or your dividend income is above the dividend allowance, then you’ll be subject to tax on some of your investment income. You can invest up to £20,000 in an Individual Savings Account (ISA) each tax year, shielding it from income tax and capital gains tax. If you haven’t maxed out your ISA, consider contributing before 5 April. The personal savings allowance is £1,000 for basic rate taxpayers, £500 for higher rate taxpayers and £0 for additional rate taxpayers. With interest rates increasing recently, some people will be caught out by this. Tax-Efficient Investments If you invest in Venture Capital Trusts (VCTs), Enterprise Investment Schemes (EIS) or Seed Enterprise Investment Schemes (SEIS) then there are tax reliefs available up to certain limits. However, it must be noted that these investments can be risky so speak to your financial advisor. Act Now to Save on Tax Taking proactive steps before the tax year end can make a significant difference to your tax bill. If you're unsure about the best strategies for your situation, consult a tax professional to ensure you’re making the most of available allowances and reliefs. Need help with your tax planning? Get in touch today to maximise your savings before the 5 April deadline!

Whether your tax return has been filed already or not, if you have a tax liability for the 2023/24 tax year, the payment is due by 31 January 2025. If you pay payments on account, your first payment for the 2024/25 tax year will also be due by 31 January 2025. This is relevant if your 2023/24 tax liability was over £1,000 and you don’t have 80% of your tax paid via payroll. What Happens if You Miss the Deadline? If you miss the 31 January 2025 deadline, it can be costly. HMRC will charge interest (the current rate is 7.25%) until the liability is paid. If you have any tax still owing after 30 days (2 March 2025) then there is also a penalty charged at 5% of the tax due. Another 5% penalty is charged after 6 months and another 5% after 12 months for any tax still owing. What Should I Do? We would recommend logging into your self-assessment account to check whether your tax return is filed and if you owe any tax. If you don’t have a self-assessment account set up yet, you can create one on the HMRC website. If you have an accountant, they’re likely to have contacted you if you have a payment to make but you can also check with them. What If I Can’t Afford My Tax? If you have tax to pay but can’t afford it then it’s worth setting up a Time to pay agreement with HMRC as soon as possible, ideally before the payment deadline. You can do this by searching HMRC time to pay on the internet (make sure you’re on the official gov.uk website). This suspends the late payment penalties as long as you keep up with the agreed payments. Interest will still be payable. Why Work with CJL Accountancy? Tax can be complex, especially if you’re juggling multiple income streams or navigating HMRC’s ever-changing rules. At CJL Accountancy, we specialise in helping influencers, landlords, and small businesses maximise their tax efficiency. We encourage early tax return preparation and in year calculations where relevant so that you have time to plan for your tax payments. We will advise on the costs you can claim to ensure that you don’t pay more tax than necessary. Act Now: Don’t Wait Until the Last Minute With less than two weeks to go, make sure you know if you have a tax payment to make. Let CJL Accountancy take the stress out of your tax return. We’re not guaranteeing 2023/24 tax returns at this late stage but contact us if you’d like help with your 2024/25 tax return. Getting an accountant in place early will mean there’s plenty of planning time to maximise allowances, reduce your tax and plan for payments.

Do influencers have to pay tax? Yes, influencers and content creators must pay tax in the UK if they make a profit. HMRC treats earnings from social media as taxable income, similar to any other form of self-employment. Whether you're earning money through brand deals, affiliate marketing, sponsored posts, ad revenue, or even freebies, these could all be considered taxable income. What counts as taxable income? Taxable income can include: Cash payments from brands or platforms like YouTube or TikTok Free products or services provided in exchange for promotion (yes, that PR box or free hotel stay is taxable if it's part of a business deal) Affiliate earnings from links or codes Event appearance fees Monetisation features such as TikTok’s Creator Fund or YouTube AdSense payments What tax do influencers pay? Income tax - paid on profits (income minus allowable expenses) National insurance contributions (NICs) - payable if your profits exceed £12,570 VAT - if your income exceeds £90,000 in a 12-month period, you must register for VAT Can I deduct expenses? Absolutely! As a content creator, you can deduct allowable business expenses to reduce your taxable income. They must be wholly and exclusively for your business. Common examples include: Equipment such as cameras, microphones, and lighting Software subscriptions (e.g. editing tools) Internet and phone bills (proportionate to business use) Travel expenses for work-related trips Office supplies or rent (if you work from home, you can claim a portion) Keeping detailed records is crucial to ensure you claim all legitimate expenses and avoid issues with HMRC. What do I need to do? You’ll need to register as self-employed with HMRC and then file an annual self-assessment tax return. The tax year runs from 6 April to 5 April and tax returns need to be filed by the next 31 January. Tax payments are due by 31 January and you may also need to make a payment on account by 31 July if your tax liability is over £1,000. If you're unsure whether you should register or need help with the process, get in touch. What happens if I don’t pay tax? Failing to declare income can lead to HMRC charging penalties and interest and ultimately it is a criminal offence to evade taxes. To avoid this, make sure you keep accurate records of all income and expenses, set aside money for tax, and file your returns on time. Why work with an accountant? Navigating the tax system can be overwhelming, especially when your income streams come from multiple sources. An accountant experienced in working with influencers can help you: Maximise your tax efficiency by claiming all allowable expenses Understand your VAT obligations if you’re nearing the threshold Avoid pitfalls like underpayment or late submissions Stay on top of changes in tax laws Conclusion As an influencer or content creator, paying tax is a legal requirement and an important part of running your business. By staying informed and organised, you can ensure you remain compliant while maximising your earnings. If you’re unsure where to start, we’re here to help. As accountants specialising in influencer tax, we understand the unique challenges of your industry. Get in touch today to ensure your finances are in safe hands!

Do you need a business bank account for this? Even if it’s not legally required, having a separate account for your business can make a huge difference. Let’s break it down. When is a business bank account legally required? If you operate as a limited company, you are legally required to have a business bank account. This is because a limited company is a separate legal entity, and its finances must be kept distinct from your personal funds. If company funds are paid into a personal account then you’ve already withdrawn funds from the company which has tax implications. However, if you’re a sole trader or a landlord managing property income (not through a limited company), there’s no legal obligation to have a business bank account. That said, there are several reasons why it’s highly recommended. The benefits of a business bank account Clearer financial records - keeping your business and personal finances separate simplifies your bookkeeping. This makes it much easier to track income and expenses, which is essential for accurate tax returns. Professionalism - a business bank account gives you a more professional image. Clients, tenants, or suppliers may feel more confident when they see payments or invoices associated with a business account rather than a personal one. Better financial control - with a dedicated account, you can monitor your business cash flow at a glance. This helps you budget, identify trends, and avoid overspending. Tax efficiency - having separate accounts simplifies the process of claiming business expenses. With everything in one place, you’ll avoid missing deductions and reduce the risk of HMRC queries. Access to business banking perks - many business bank accounts offer features like invoicing tools, integrations with accounting software, and tailored business loans or credit options. Making Tax Digital (MTD) With MTD being introduced from April 2026 for landlords and sole traders, having a separate business bank account will make it much easier to record your transactions digitally and file the quarterly returns with HMRC. If you're using software then you can usually link your account so the transactions are pulled in automatically or if you're using spreadsheets then you could download the transactions from that account. You can read more about MTD in our previous blog here . How many business bank accounts should I have? For limited companies, sole traders and landlords it may also be worth having multiple business bank accounts for two reasons: Funds protection – the Financial Services Compensation Scheme that covers you when banks fail also covers business accounts. You could open bank accounts with more than one financial institution to spread your funds. If one bank is having any technical issues it also reduces the impact on you. Tax savings – it’s useful to have a second account to save for tax liabilities. You could move an amount each time you receive rent or revenue to cover your self-assessment or corporation tax liability at the end of the year, or VAT liabilities at the end of the quarter. Conclusion While it’s not mandatory for sole traders or individual landlords, having a separate account is a good idea for most. The benefits in terms of organisation, professionalism, and tax efficiency far outweigh the small costs or effort involved in setting one up.

Our previous blog looked at working from home expenses for the self-employed which you can read here . For limited companies it’s a little more complicated as the company is a separate legal entity. There are three options for claiming: The fixed rate allowance As a director, you can claim £6 per week from the company for working from home costs which is an allowable expense for the company against corporation tax and it is not chargeable to income tax for you. However, you can only claim this if the company does not have a business premises. Actual costs You can claim a proportion of your costs including gas, electricity, water, telephone and internet. You’ll need to use a reasonable method of dividing your costs, for example by looking at the number of rooms you use for your business and the time that you spend working from home. Unlike for the self-employed, you cannot claim a proportion of rent, mortgage interest or council tax as these are considered to be fixed costs and don’t increase as a result of working from home. It’s important to keep records of the costs and the method used to divide the costs in case HMRC asked to see it. Rental agreement The other option is that you can charge your company rent to use part of your home. You would need to put a rental agreement in place that is signed by both parties and is at a commercial rate. The company then pays you rent at the agreed rate and this is an allowable expense in calculating your company profits. The rent that your company pays is rental income for you personally and needs to be declared on your personal self-assessment tax return. Ideally the income will be eliminated by the actual costs incurred and therefore no tax will be payable but it will still need to be declared. Other points to consider if you’re looking at the rental agreement option: You may need to check any rental agreements or mortgages to ensure that you’re allowed to run your business from home. You should check if there is any effect on your home insurance policy. There may be capital gains tax payable if you use part of your home solely for business purposes. You should check that your home would not become subject to business rates. Important points to remember for claiming working from home expenses Keep accurate records - document all expenses, including how you calculated business use. Only claim for business use - HMRC is strict about claiming only the portion of costs genuinely associated with business activities. Review your claims annually - as your working pattern and expenses may change, it’s worth reviewing your home working claims each year to ensure they are still accurate. Need help? Get in touch Navigating home working expenses can be complicated, especially with changing HMRC rules. We can help you ensure you’re claiming the maximum allowable expenses.

There are two options for claiming: Proportion of actual costs You can claim the business proportion of your costs for things like: Gas and electricity Water Council tax Mortgage interest (not the capital repayment) or rent Internet and telephone You’ll need to use a reasonable method of dividing your costs, for example by looking at the number of rooms you use for your business and the time that you spend working from home. It’s important to keep records of the costs and the method used to divide the costs in case HMRC asked to see it. Also note that if you have rooms that you use solely for your business, this may effect your eligibility for private residence relief where you own your home so it’s a good idea to also have personal use of the rooms if possible. Simplified expenses You can avoid the complex calculations above by using simplified expenses which is a flat rate based on the number of hours you work from home each month. You do not need to prove any costs to HMRC as they have set the rates, although you may be asked to justify the number of hours if HMRC believe them to be inflated. The current rates are as follows: 25 to 50 hours £10 per month 51 to 100 hours £18 per month 101+ hours £26 per month Each month should be calculated separately so if you take a holiday one month, you may need to claim a lower amount that month. Conclusion Make sure that you’re making a claim for your home working as it will reduce your tax bill. Contact us if you’d like any help with your self assessment tax return.