What's changing for your small business clients in the 2021/22 tax year?
30th Mar 2021
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A new tax year is starting on 6th April, which means many of the changes announced in recent Budgets will come into effect. Before the 2021/22 tax year kicks off, award-winning accounting software provider FreeAgent has compiled a handy roundup of the key changes for your small business clients.
Construction Industry Scheme (CIS) updates
If any of your clients are VAT-registered subcontractors in the building and construction industries, the domestic VAT reverse charge legislation has changed how your clients apply the reverse charge to their CIS invoices for VAT-registered contractor customers.
IR35 changes in the private sector
If any of your contractor clients work with large or medium-sized businesses in the private sector, your client’s customer will need to decide whether the work your client does for them falls within IR35 from 6th April 2021. If it does fall within IR35, your client’s customer will have to collect tax and NI from the money they pay your client.
Tax and National Insurance rates and bands
Here are the changes that will come into effect in April 2021:
National Minimum Wage and National Living Wage
Changes will come into effect on 1st April. Note the different age bands for 2021/22.