All VAT businesses must file online in 2012

You will have to file your VAT returns online in 2012 if:

You will also have to pay any VAT due to HMRC electronically - there are lots of ways you can do this.

The rules on how you calculate your VAT, keep your records and complete the return are not changing - it is only the way you send your return to HMRC that is changing.

Paying electronically means you get longer to file and pay. Paying online by direct debit gives you the longest extension to the filing deadline, and means that the VAT shown on your return is collected automatically on the right day. Any repayments due to you will be processed more quickly online, too.

 PAYE Tax Codes

The basic personal allowance for 2011-12 will be increased from £6,475 to £7,475. The majority of individuals with simple tax affairs will see an automatic uplift in their tax code from 647L to 747L.  Any individual tax codes will be issued by HMRC between January and March 2011 - please check your coding notice carefully to ensure the correct amount of tax is deducted for the coming year.

The point at which taxpayers start to pay the higher rate of tax on their taxable income is decreasing from £37,400 to £35,000.

The withdrawal of personal allowances for those with adjusted net incomes over £100,000 will continue for 2011-12. The personal allowance is reduced by £1 for every £2 of adjusted net income above the income limit. Therefore, those with adjusted net income over £114,950 will lose all their personal allowance.

Changes to payment of Class 2 NIC's

Payment of Class 2 NIC's for the self employed will be simplified by aligning the payment dates with the Self Assessment (SA) payment dates for income tax and Class 4 NIC's of 31 January and 31 July. 

From 2011-12, Class 2 NIC's will be collected in 12 monthly installments starting in August and ending the following July.  The last collection for the 2010-11 tax year will be in April 2011 (for March 2011).  There will be no monthly collections of Class 2 NIC's in May, June or July 2011. The first monthly collection for the 2011-12 tax year will be in August 2011 which means that by July 2012, the liability for the 2011-12 year will have been paid in full.

Important savings for new businesses

Don't forget that the Regional Employer National Insurance Contributions Holiday (NIC's holiday) will run until 5th September 2013. Open to new businesses set up on or after 22nd June 2010, the scheme enables eligible new businesses to take a holiday from paying NIC's for each of the first 10 employees they hire in the first year of operation. Each holiday will last for the first 52 weeks the employee is in post providing these weeks fall within the three year holiday period. 

Visit www.businesslink.gov.uk/nicsholiday to find out further information.