Taxes without stress: in installments!

In the UK, you don’t have to pay your tax all at once.
Yes, you heard right: HMRC doesn’t demand full payment on the day you file. You can spread your tax bill into interest‑free, penalty‑free installments.

Why you shouldn’t wait until January to file?
Many self‑employed people procrastinate until the deadline. But waiting until January means:

• You must pay last year’s tax in one lump sum.

• You also must make your next year’s first payment immediately.

• After the holidays, your budget is often tight.

• Rushing leads to stress, mistakes, and overspending.

All of this is avoidable if you act early.

Solution: File your Self‑Assessment in May!
By filing in spring or early summer, you gain:
✅ Time to double‑check everything
✅ The chance to learn your exact bill and plan your budget
✅ Peace of mind—no January scramble
✅ More time for tax planning with an experienced accountant at Capital Empire

Instead of a single £1,000 bill in January, you could pay just £100 per month. No interest. No penalties.

📩 Want to file your Tax Return stress‑free and with maximum benefit?
Write to us on WhatsApp or Telegram: +44 7555 858 858

Do you work under a UTR? This common mistake is often overlooked.

In the UK, many self-employed individuals using a UTR (Unique Taxpayer Reference) are unaware of an important detail that directly affects their pension record, tax calculations, and even eligibility for financial support.
We’re talking about the fact that your UTR and NIN (National Insurance Number) might not be linked in the HMRC system.

Why is this important?
If your UTR and NIN are not linked, it can lead to serious consequences:
• HMRC may not record your National Insurance contributions → you lose pension years.
• Risk of penalties.
• Difficulties in claiming benefits, tax refunds, or getting mortgages and loans.
• HMRC may mishandle your tax submissions, leading to extra checks and requests.

Common reasons for unlinked records:
• NIN was not provided or was incorrect when registering for UTR.
• A temporary NIN was used.
• Personal data errors (name, date of birth, address).
• You received your NIN after UTR registration, and the system wasn’t updated.
• Technical error in HMRC’s system (more common than expected).

What should you do?
• Check if your UTR and NIN are linked.
• If not, send a request to link them.

💡 How to check?
We explained it in detail in our video on Instagram, Facebook и TikTok

Who will be required to register for MTD (Making Tax Digital) and submit reports?

MTD ITSA will be mandatory for:
• Self-employed individuals (sole traders)
• Property owners (landlords) who receive rental income.
But only if their income exceeds the established thresholds:

Implementation date Income threshold (total annual income from self-employment and rental)
from April 2026 over £50,000
from April 2027 over £30,000
from April 2028 over £20,000
If the income is below the specified amounts, switching to MTD is not yet mandatory.

Who will be able to register and submit reports?
Reporting and registration in MTD can be done by:
• The taxpayer themselves (self-employed)
Using approved tax software (MTD-compatible software), which will be integrated with the HMRC system.
• Accountants and tax agents
Any qualified accountant or tax advisor can submit a return on your behalf. To do so, you must provide the agent with authorisation (agent authorisation) through HMRC.

How will MTD ITSA reporting work?
You will need to keep digital records of income and expenses throughout the year.
Four times a year (quarterly) you must send digital reports on income and expenses to HMRC.
At the end of the tax year, you will need to submit a final (annual) report, confirming the results of the year and finalising the tax calculation.

Exemption from MTD
Not everyone is required to use the digital system. There are exceptions:
People who find it difficult or impossible to keep digital records (e.g. the elderly, disabled or those without internet access).
Some taxpayers who are unable to use digital services may be granted an exemption based on an application to HMRC.

Summary:
If your income (from rent or self-employment) exceeds the threshold, you must switch to MTD.
Reports can be submitted either by you or with the help of an accountant/agent.
The system involves quarterly reports and one final annual report.
Persons with low income or limited capabilities may receive exemptions.

This system is designed to simplify tax accounting, reduce errors, and make taxation more transparent for both taxpayers and HMRC.

Free Breakfasts in UK Schools

Free breakfast club roll out: everything you need to know What is the new free breakfast club scheme?
We are introducing free breakfast clubs – 30 minute sessions before school where children get a free breakfast so they to start every day ready to learn.
180,000 pupils in the most disadvantaged communities will be able to access free breakfast clubs.
We have just named the first 750 schools who are taking part in the programme, who will start offering these sessions at the beginning of the summer term.
These schools are based across nine regions in England and will be funded to provide this service – available to all children in each setting.
This is the first phase of a national roll out which will see free breakfast clubs in every primary school in England in due course. Free breakfast clubs will help ensure pupils start every day ready to learn, and in turn will improve behaviour, attendance and attainment. What will my child get for breakfast?
Schools will provide healthy, nutritious and varied breakfasts that follow the School Food Standards.
What are the benefits of free breakfast clubs?
Free breakfast clubs mean no child starts school hungry and will help set children up for the day by providing a nutritious breakfast as well as time with friends to enjoy activities such as reading and crafts.
Breakfast clubs, such as those already run by the Magic Breakfast programme have been shown to boost children’s reading, writing, and maths by an average of two months.
For parents, free breakfast clubs mean help with childcare at the start of the school day – at no extra costs.
It means those parents can drop their children off half an hour earlier – helping parents get into work and saving working families up to £450 a year.
We know many families are feeling the impact of the cost-of-living crisis. Out of the 180,000 children who will benefit in the first 750 schools, around 67,000 attend schools in deprived areas.
This is one of the measures we are taking to cut the cost of living for families. We are also legislating to significantly cut uniform costs through a cap on branded items, alongside our government-funded childcare rollout.
Which schools are part of the first phase of free breakfast clubs?
Schools selected for the early adopter scheme will contact families directly about how to sign up for the breakfast club. The chosen schools represent different types, sizes and geographical areas across England. What if my school isn’t part of the scheme yet?
This is the first phase of a planned national rollout. The government is using this early adopter phase to learn from different types of schools before expanding the programme. Schools are currently testing various approaches to ensure the programme works effectively for all communities.
If you have specific questions about how the new breakfast club scheme will work in your child’s school, we recommend speaking directly with the school once they confirm their participation.
How much funding will schools get?

Schools will receive a lump sum for set up, and then a further recurring lump sum of over £1000 to help with costs.
To put this in perspective, an average school with 50% take up on the early adopter scheme would receive around £23k for a full year.
That money will cover the cost of food, delivery and staffing costs. This is much more than the existing school breakfast programme – on average, a school switching to the early adopter scheme would receive an additional £21,400 of funding.
Free breakfast clubs will help ensure pupils start every day ready to learn, and in turn will improve behaviour, attendance and attainment.
What will my child get for breakfast?
Schools will provide healthy, nutritious and varied breakfasts that follow the School Food Standards.
What are the benefits of free breakfast clubs?
Free breakfast clubs mean no child starts school hungry and will help set children up for the day by providing a nutritious breakfast as well as time with friends to enjoy activities such as reading and crafts.
Breakfast clubs, such as those already run by the Magic Breakfast programme have been shown to boost children’s reading, writing, and maths by an average of two months.
For parents, free breakfast clubs mean help with childcare at the start of the school day – at no extra costs.
It means those parents can drop their children off half an hour earlier – helping parents get into work and saving working families up to £450 a year.
We know many families are feeling the impact of the cost-of-living crisis. Out of the 180,000 children who will benefit in the first 750 schools, around 67,000 attend schools in deprived areas.
This is one of the measures we are taking to cut the cost of living for families. We are also legislating to significantly cut uniform costs through a cap on branded items, alongside our government-funded childcare rollout.
Which schools are part of the first phase of free breakfast clubs?
Schools selected for the early adopter scheme will contact families directly about how to sign up for the breakfast club. The chosen schools represent different types, sizes and geographical areas across England.
Magic Breakfast, a Children’s Charity in the UK, provides 300,000+ daily nutritious breakfast to children in need, supporting their health and learning

Government measures to combat illegal work and conduct inspections

The government is taking measures to combat so-called “fraudulent employers” who abuse the immigration system and exploit vulnerable migrants working illegally in the UK. This includes increasing the number of targeted immigration visits to businesses suspected of employing illegal workers, reaching 856 visits in October alone—55% more than in the same month last year. From January to October this year, more than 6,600 visits were conducted, an increase of over 21% compared to last year.

Right-to-work checks must be carried out before hiring to ensure that the individual is legally allowed to perform the job. If done correctly before employment starts, it provides a permanent “statutory excuse” for the duration of the worker’s employment, meaning further checks are only required if their right to work is time-limited and approaching expiration.

Organizations must ensure these checks are performed for all potential employees, including British and Irish citizens, to eliminate the risk of discriminatory treatment and prevent mistakes in verifying work authorization.

Checks can be done manually or digitally. Manual checks involve verifying a document from List A or List B, maintained by the government. A copy of the document must be made and stored throughout the employment period and for two years afterward.

For UK and Irish citizens, digital checks can be conducted using Identity Document Validation Technology (IDVT) through an Identity Service Provider (IDSP) to complete the digital identity verification for those with a valid passport (including Irish passport cards).

For foreign workers, online verification can be done using the Home Office’s Employer Checking Service with a share code provided by the individual whose right to work is being confirmed, along with their date of birth.

Right-to-Work Update

Previously, employers could use paper copies of Biometric Residence Permits (BRP) or Residence Cards (BRC) to verify foreign workers’ right to work. However, this option was removed on April 6, 2022, and replaced with the Employer Checking Service. The Home Office is transitioning to electronic visas instead of BRPs or BRCs, with all current BRPs and BRCs set to expire on December 31, 2024.

This expiration does not affect the right to work of those who presented these documents during the hiring process, as long as the right-to-work check was conducted in compliance with Home Office requirements. Even if the document expires, their right to work remains valid.

However, employers may need to recheck the right to work for some employees who initially provided a physical BRP or BRC. BRPs and BRCs issued from January 2020 onwards expire on December 31, 2024, or earlier, requiring rechecks before expiration. Older BRPs and BRCs issued before January 1, 2020, may have an expiration date beyond December 31, 2024. In such cases, a follow-up right-to-work check must be completed before that date, requiring the employee to create a UKVI account and obtain an e-visa. If employers have doubts, they should consult the Home Office’s Employer Checking Service on GOV.UK.

Government Actions

The government has reaffirmed its commitment to cracking down on illegal work and worker exploitation through penalties such as:

• Financial penalty notices
• Business closure orders
• Potential criminal prosecution

In December 2024, the government released data on illegal work enforcement, highlighting intensified Home Office immigration operations across the UK, focusing on nail salons, supermarkets, the automotive sector, car washes, and construction.

In a statement to the House of Commons on December 2, 2024, Home Secretary Yvette Cooper confirmed that under the Labour government, illegal work visits increased by 34%, and arrests rose by 25% compared to the same period the previous year.

From July 5 to October 31, 2024, authorities conducted 3,188 visits to employers suspected of illegal hiring, leading to 2,299 arrests. By comparison, between July 5 and October 31, 2023, there were 2,371 visits and 1,836 arrests.

The government also announced plans to extend the ban on hiring foreign workers for employers who repeatedly violate visa rules or commit serious employment offenses.

Currently, those who disregard visa regulations face sanctions for up to 12 months. Under new proposals, the repeat offense period will increase to at least two years, with further “cooling-off” periods to be determined.

For employers who violate the rules, new compliance plans will require them to take specific corrective actions, extending enforcement from three to 12 months.

The Home Office has also warned that while these longer-term plans are in effect, non-compliant employers will face restrictions on hiring foreign workers. Failing to comply may result in the revocation of their sponsor license.

Future Plans

These changes will accompany a new Employment Rights Bill, currently under parliamentary review. This bill will establish a Fair Work Agency, merging existing enforcement bodies, including immigration control teams, employment agency regulations, national minimum wage enforcement, statutory sick pay oversight, and licensing schemes for specific industries.

Dress Code and Tattoos

Questions and Answers

Q: Should we relax the dress code rules and allow tattoos?

More and more candidates come to interviews with visible tattoos. Technically, this contradicts our dress code, but in today’s world, it no longer seems relevant. Do you think it’s time to relax these rules?

A: Your stance on covering tattoos is your decision; however, you should be able to explain to your staff why you want them to be covered. Your position will likely depend on the type of organization and the nature of the work being done. You may request employees to cover tattoos if you want to present a certain professional environment. Different rules may apply to employees who interact with clients versus those who do not. As long as these rules are applied consistently, this should not be an issue.

Remember, allowing self-expression in the workplace can help build positive relationships with employees and make them feel valued by their employer. Some companies follow this approach—for example, in May 2022, Virgin Atlantic lifted its ban on visible tattoos for uniformed staff to highlight the “individuality of its employees and customers.”

Be Ready to Submit Safety and Security Declarations for Imports from the EU

Importers who are able to start submitting safety and security declarations for imports from the EU to the UK are encouraged to do so before the official start date of January 31, 2025, when these submissions will become mandatory.

His Majesty’s Revenue and Customs (HMRC) has clarified that the carrier or transporter moving goods across the UK border will be legally responsible for ensuring that the required safety declarations are submitted. However, they can arrange for a third party to submit the declaration on their behalf.

“Safety and security declarations help combat illegal goods, such as drugs and weapons, being brought into the UK,” HMRC stated, “and ensure that legitimate goods are not delayed by unnecessary checks.”

A short video has been published and is available on YouTube.

Starting from the above-mentioned date, HMRC will reduce the amount of data required for safety declarations (also known as Entry Summary Declarations), cutting the number of mandatory fields from 37 to 20. Additionally, there will be eight conditional fields that will only need to be filled out under specific circumstances. The remaining nine fields will be optional.

Businesses are strongly encouraged to consult with their supply chains to determine who will be responsible for completing the safety and security declarations for imports from the EU to the UK from January 31, 2025, and to agree on the most suitable method for submission.

Self-Assessment and January (Penalties)

A critical date in the calendar each year for those working in the field of personal taxation is January 31, when self-assessment tax returns and tax payments must be submitted. Many clients delay sending their documents to agents until the last minute.

However, despite all efforts, some will not be able to submit their returns and required payments on time. What happens next? What other options are available?

Penalties

There are fixed penalties for:

• Late submission of tax returns,
• Late payment of tax,
• Failure to notify initially and for subsequent errors in tax returns.

If the tax return is not submitted by January 31, a £100 penalty is charged. If the return is not submitted within the next three months, a £10 per day penalty is applied for the next 90 days. If the return is six months overdue, an additional penalty of £300 or 5% of the unpaid tax (whichever is greater) is imposed. The same applies again after a 12-month delay.

There are separate penalties for non-payment of tax:

• After 30 days of non-payment following January 31, a 5% penalty is charged.
• After six months, another 5% penalty is applied.
• After 12 months, an additional 5% penalty is imposed.

An important aspect to consider with late payments is that, in addition to penalties, interest will accrue until the debt is paid. The current annual interest rate (as of November 26, 2024) on overdue income tax and capital gains tax is 7.25%.

Once the Making Tax Digital system for income tax is introduced in 2026–2027, a new points-based penalty systemwill apply—similar to what was introduced for VAT in January 2023.