Back to Blog

HMRC outline Making Tax Digital plans

HMRC have issued a series of consultation documents outlining further plans for the government's Making Tax Digital (MTD) initiative. HMRC have published six consultation documents on MTD. The six consultations set out detailed plans on how HMRC propose to make tax digital and to simplify the tax system. The consultations look at the following areas: How digital record keeping and regular updates will operate - this considers compulsory digital record-keeping and quarterly 'updates' to HMRC ...

Charity news

Annual returns The Charity Commission, which is the relevant body for charities registered in England and Wales, has announced that its latest annual return is now available and can be found on GOV.UK. All registered charities, in England and Wales, with an income of more than £10,000 and all Charitable Incorporated Organisations reporting on their financial years ending in 2016 must complete the online form within ten months of the end of their financial year. Part of the data submitted is us...

Working in hot temperatures

ACAS have some guidance on 'hot weather' working. The guidance confirms that: 'In the UK there is no maximum temperature that a workplace is allowed to be, rather advice from the Health & Safety Executive (HSE) states 'during working hours, the temperature in all workplaces inside buildings shall be reasonable'. What is reasonable depends on the type of work being done (manual, office, etc) and the type of workplace (kitchen, air conditioned office, etc). The HSE offers further guidance on ...

Updated student loan deduction guidance

HMRC have issued updated guidance to employers on how to deal with student loan deductions via the PAYE system. Employers should familiarise themselves with the guidance which has been updated to reflect the introduction of plan 2 loans which are repayable from a different threshold but at the same nine percent basis. With effect from the 2016/17 tax year there are two plan types for student loan repayments: plan 1 with a threshold of £17,495 (£1,457 a month or £336 per week) plan 2 with...

Latest ONS labour market statistics

The ONS has announced that in the three months from March to May 2016, the number of people in work increased. The number of unemployed people and the number of people not working and not seeking or available to work (economically inactive) fell. The statistics reveal that there were: 31.70 million people in work (176,000 more than for the three months to February 2016 and 624,000 more than for a year earlier). 23.19 million people working full-time (401,000 more than for a year earlier) 8.5...

HMRC latest ‘tax cheat’ targets

HMRC have launched a new taskforce to tackle wealthy tax cheats who are living beyond their means in Northern Ireland and expect the campaign to recover approximately £18 million. HMRC have announced that they are using Land Registry and Merchant Acquirer data to identify those with 'badges of wealth' such as large houses, aeroplanes, boats and undeclared offshore bank accounts which are not in keeping with the information they report to HMRC. HMRC's Ian McCafferty, Taskforce Lead, said: 'Ou...

TPR latest pensions auto enrolment awareness

According to the latest research by the TPR, based on surveys carried out between February and April 2016, the understanding amongst small employers of their duties under pensions auto enrolment saw a significant rise from 68% to 81%. Executive Director of Automatic Enrolment, Charles Counsell said: 'More than 9 in 10 small employers are now aware of automatic enrolment, and there is now almost universal engagement from business advisers helping their clients to carry out their duties. This i...

Residential property income and interest relief

The government has issued guidance and examples on the restriction of income tax relief for interest costs incurred by landlords of residential properties. The new rules, which are phased in from April 2017, only apply to residential properties and do not apply to companies or furnished holiday lettings. From April 2017 income tax relief will start to be restricted to the basic rate of tax. The restriction will be phased in over four years and therefore be fully in place by 2020/21. In the firs...

Labour Statistics

The latest ONS labour market statistics show a 55,000 rise in employment in the three months to April 2016. The Office for National Statistics has announced that: 'Between the 3 months to January 2016 and February to April 2016, the number of people in work increased, the number of unemployed people fell, and the number of people not working and not seeking or available to work (economically inactive) fell slightly. There were 31.59 million people in work, 55,000 more than for the 3 months to...

Holiday entitlement

Now is the time of year when many of us turn our thoughts to holidays and it is important to get holiday entitlement and holiday pay right. The GOV.UK calculator has recently been updated and can be found by using the following link. The acas website also includes useful guidance on calculating holiday and holiday pay entitlements. If you would like help with payroll matters please contact us. Internet link: GOV.UK calculator ...

Have you accessed your Personal Tax Account?

HMRC are advising employers that their employees may benefit from accessing their Personal Tax Account. These accounts allow taxpayers to view information about their tax affairs and advise HMRC online about changes that may affect the tax they pay. The services available through the Personal Tax Account include: checking income tax estimates and tax codes advising HMRC about changes affecting company cars using the online forms available to claim tax deductible work expenses or a tax refun...

Contractors Monthly Returns

From April 2016 changes have been made to the Construction Industry Scheme (CIS). Part of the reforms were that contractors must file their monthly returns online. HMRC have introduced a number of improvements to the CIS online service with a view to making it easier and more efficient to use. These changes include the facility to amend returns online. They have also introduced a new online message/alert service. HMRC will issue messages and alerts including: Monthly Return Inactivity Confir...

New Banks and charities urged to do more to protect scam victims

The Chartered Trading Standards Institute (CTSI) has called for banks and charities to take greater responsibility for those who may be vulnerable to scams. The CTSI commissioned a report from Bournemouth University's National Centre for Post Qualifying Social Work into scam victims, and its recommendations to financial institutions and charities include: recognising their duty of care to dementia sufferers who could make an 'unwise decision' as a result of their cognitive state allowing vu...

UK Votes to Leave EU

Making the most of the changes Includes ten-point check lists for businesses and individuals INTRODUCTION What exactly happened on 23 June? Are we still in the EU? Aside from the political upheavals, what are the practical problems that small business owners and tax payers will be facing as a direct result of the Brexit vote? In this short newsletter we have attempted to de-mystify the steps our government will...

HMRC update phishing scam advice

HMRC have updated their guidance to taxpayers on how to spot phishing scam emails. Phishing is the fraudulent act of emailing a person in order to obtain their personal/financial information such as passwords and credit card or bank account details. These emails often include a link to a bogus website designed to encourage the unwary to enter their personal details. The HMRC guidance is designed to help taxpayers to recognise genuine contact from HMRC, and how to tell when an email/text messag...

NAO report says HMRC's customer service quality 'collapsed'

According to a report by the National Audit Office (NAO) the quality of service at HMRC 'collapsed' over an 18 month period between 2014 and 2015. The report found that average call waiting times tripled in 2014/15 and in the first seven months of 2015/16. Call waiting times for self assessment tax returns peaked at 47 minutes last autumn, which resulted in HMRC having to bring in 2,400 extra staff for their tax helpline. Using HMRC's own criteria, the NAO valued people's time at an average of...

VAT Flat Rate Scheme guidance updated

HMRC have issued updated guidance on the operation of the VAT Flat Rate Scheme which allows taxpayers to calculate the VAT payable by applying a flat rate percentage to their VAT inclusive turnover, rather than netting off output and input VAT due on sales and purchases. The revision in the guidance follows a number of unsuccessful visits to the First Tier Tribunal (FTT). HMRC has issued a revised version of VAT notice 733 Flat Rate Scheme to update their guidance in accordance with the FTT dec...

PAYE 3 days grace and risk based penalties to continue

HMRC have confirmed, in their updated guidance, that the three day easement and risk assessed approach to issuing penalties will continue to apply for 2016/17. As a result employers will not incur penalties for delays of up to three days in filing PAYE information during the 2016/17 tax year. Late filing penalties will continue to be reviewed on a risk-assessed basis rather than be issued automatically. Employers are required to file a Full Payment Submission (FPS) on or before each payment of...

New Advisory fuel rates for company cars

New company car advisory fuel rates have been published which took effect from 1 June 2016. The guidance states: 'You can use the previous rates for up to one month from the date the new rates apply'. The rates only apply to employees using a company car. The advisory fuel rates for journeys undertaken on or after 1 June 2016 are: Engine size Petrol 1400cc or less 10p 1401cc - 2000cc 13p Over 2000cc 20p Engine size LPG...

HMRC Guidance for Employers

The April Employer Bulletin includes articles on: reporting expenses and benefits in kind for 2015/16 using form P11D Scottish Rate of Income Tax coding notice issues Class 1 National Insurance contributions for apprentices under the age of 25 changes to Student Loans Deductions including the introduction of type 1 and type 2 loans and the reminders which HMRC will issue to employers who fail to make deductions. The Bulletin also includes links to HMRC's guidance on the restriction to Emp...

Pensions Freedom Update

According to HMRC figures over 230,000 people have used the new pension freedoms introduced one year ago and accessed over £4.3 million in pensions saving. In April 2015, the government introduced significant pension reforms giving people the ability to access their pensions savings how and when they want. The statistics show that in the first year of these new rules being available, more than 232,000 people have accessed £4.3 billion flexibly from their pension pots. The Economic Secretary ...

Savings Allowance

A new savings allowance is available to basic and higher rate taxpayers for 2016/17. The amount available depends on the individual's circumstances: If any of the individual's income for the year is additional rate income then the individual's savings allowance for the year will be nil. If any of the individual's income for the year is higher-rate income and none of the individual's income for the year is additional rate income, the individual's savings allowance for the year is £500. If n...

VAT fuel scale charges

HMRC have issued details of the updated VAT fuel scale charges which apply from the beginning of the next prescribed VAT accounting period starting on or after 1 May 2016. VAT registered businesses use the fuel scale charges to account for VAT on private use of road fuel purchased by the business. Please do get in touch for further advice this or other VAT matters. Internet link: Gov.uk Fuel scale charges ...

Farmer's averaging

Changes have been made to the rules which allow farmers to average their profits for tax purposes. Under the new rules unincorporated farmers will be able to average their profits for income tax purposes over five years rather than the previous two years. The amendment to the rules which took effect from 6 April 2016 is aimed at helping farmers with fluctuating profits better manage the 'risk and the impact of global volatility which has become an inherent feature of the agricultural industry'....

Parking fines ruled not deductible

A tribunal has ruled that security firm G4S cannot reduce its profits for tax purposes by deducting parking fines. The company, G4S Cash Solutions, tried to reduce their corporation tax bill by approximately £580,000 but the first-tier tribunal has ruled in HMRC's favour in rejecting the claim for the deduction of the fines. The company G4S incurred a substantial amount of parking fines usually while delivering consignments of cash over the pavement. The business tried to claim these were a ...