The Chancellor delivered his Autumn statement and Spending Review faced with intense lobbying on proposed cuts to tax credits and departmental cuts such as the police force.
Despite the expectation of further changes to business tax, we are pleased to report that he has made very few tax changes. So few in fact that the document “main tax announcements for the Autumn statement” runs to just three pages!
He appears to have focused on government spending rather than tax which is good for business. Given the big tax surprises in the Summer Budget we wished for a period of stability with fewer tax changes this time around and that is what we got.
Many of our clients are SMEs and many are still getting to grips with the changes that the Chancellor announced in the Budget following the General Election earlier this year, such as the living wage. With that in mind, we’d like to see no big surprises from the Chancellor on Wednesday so that businesses can plan for the future with confidence and focus on growth, rather than regulatory change.
We are anticipating some announcements in relation to energy efficiency and cyber security, but the key issue here is whether or not any changes will have an impact on cost. SMEs make up the backbone of the UK economy and it is precisely these organisations that feel the pinch most, whether its business rates, utility prices, wages or digital security. The government needs to fully understand how its actions will affect SMEs before implementing yet more change.
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Two HMRC taskforces targeting South West England and Wales have recovered £20m from businesses underpaying on their tax.
The South West England and Wales restaurant taskforce, launched in July 2012, has recovered £10m and the South West England and Wales VAT fraud repayment taskforce, launched in November 2013, has recovered £10.1m in unpaid tax.
Since 2011, HMRC’s has been using the taskforces to put short sharp bursts of pressure on areas or sectors which they believe to be at high risk of underpaying their tax.
The aim of the task forces is to encourage traders in those areas and sectors targeted to come forward and settle any outstanding tax payments or liabilities. In order to do this HMRC’s task forces will increase publicity about their interest in an area or sector, as well as carrying out compliance checks and announced and unannounced visits to businesses.
The governing document is the ‘rulebook’ for your charity. Depending on your charity’s structure, your governing document is likely to be one of these:
- trust deed
- articles of association
A well-written governing document will tell you many of the things you need to know about your charity, and will contain the answers to many frequently asked questions, such as:
- what the charity exists to do (its purposes, as explained in its objects clause)
- the kinds of activities that it can undertake to further those purposes, what powers it has and any limits on them
- who the trustees are, how many trustees there should be and how they are appointed and removed
- how to call meetings and what notice periods to give to call an annual or special general meeting (AGM or SGM)
- how to change the governing document, and which rules can be changed
- whether the charity has members and, if so, who can be a member and what their rights and responsibilities are
- how to close the charity down (more…)
HMRC has recently introduced new model Gift Aid Declaration forms for charities and communities amateur sports clubs (CASCs).
The new model declaration specifically advises the donor that it their responsibility to pay any shortfall between the amount of gift aid claimed and the amount of income tax and/or capital gains tax paid in a tax year.
The new declarations must be used from April 2016.
For examples of the updated single and multiple donation declarations please follow the links below:-
Charitable companies with income over £10,000 are required to complete a charity annual return and any charities with income over £25,000 must file their accounts with the Charity Commission. Most of the information needed by the Charity Commission can be found in the accounts that are filed, however due to the volume of accounts and information received it is not practical for the Charity Commission to source the information this way.
The prospect of digital filing by tagging data would reduce the pressures of the Charity Commission displaying the figures and data, aid members of the public in viewing this information and would reduce the burden of the charities needing to file. The quality and quantity of the information filed would also be improved as the function would allow financial information to be searched and reviewed more effectively.
For smaller charities the Commission plan to produce templates to aid them to file digitally. For larger charities the Commission is in talks with accounts providers to enable the digital filing straight from the accounting software; this in turn may allow the Commission to have a digital filing button on the same page as the old-style filing of the annual return and PDF accounts option.
The proposed plan would enable a significant amount of charities registered with the Commission to file digitally. The option to use the present filing system will also remain available for those not wishing to file digitally.
The consultation for this process will close on 8th December 2015.
The Annual Investment Allowance (AIA) gives a business full tax relief in the year on qualifying capital expenditure, up to a certain amount.
AIA has recently been rather generous, and is currently £500,000. From 1 January 2016 however, it is going down to a lower rate of £200,000. This new lower rate is expected to be a permanent change, giving a little more certainty than we’ve had in recent years from the UK Government.
For companies with a December year end, this is a straightforward change, however for any other company whose accounting period straddles 31 December, there are transitional rules which will have to apply.
There are two main factors that should be taken into account in this situation: