About one in 15 taxpayers failed to beat the midnight deadline on 31 January 2018 to file their annual returns relating to the 2016/17 financial year. (more…)
Anyone whose business comes under the Revenue’s microscope is usually in for a roller-coaster ride.
HMRC has upped its game in recent years when it comes to probing businesses or sole traders who may be suspected of falsely reporting or underpaying tax. (more…)
HMRC has announced a deferral to the launch of Making Tax Digital (MTD) following concerns raised by the accountancy profession, businesses and parliamentary bodies. The recommendation to postpone the implementation of MTD to 2019/2020 was originally proposed by the Treasury Committee in January which called HMRC’s plans ‘over ambitious’ in their 50 page report. The system for keeping tax records digitally was originally set to go live from April 2018. (more…)
The number of self-assessed taxpayers filing their returns late remains stubbornly high, leaving many at risk of full investigation by the Revenue. Last year 870,000 self-assessed taxpayers filed tax returns late, following a record high of 890,000 the year before.
Late filing or errors on tax returns are a red flag for HMRC, and can be one of the triggers for a full-blown investigation. These investigations can stretch on for several weeks, or even months, causing considerable disruption and financial strain to those involved. (more…)
It has been long anticipated, but HMRC have finally released the 6 consultation documents relating to Tax Digitalisation that were expected the week of the referendum. These are some of the biggest changes to the way tax operates since PAYE was brought in during the second world war!
The documents cover:
- Bringing business tax into the digital age
- Simplifying tax for unincorporated businesses
- Simplified cash basis for unincorporated property businesses
- Voluntary pay as you go
- Tax administration
- Transforming the tax system through better use of information
For a reduced fee, during July and August, we are offering to carry out a PAYE review to include a summary of recommendations to assist you in getting your house in order in respect of the recording and reporting of expenses and benefits.
With effect from 6 April 2016 Dispensations were abolished and replaced by a statutory exemption which applies in respect of business expenses. Now all employers must deal with expenses payments as if they had been granted a dispensation, and satisfy the conditions laid down in statute.
There is therefore a greater emphasis on employers and the requirement to operate an adequate system for checking employee’s expenses claims and other payments to ensure only genuine business expenses are paid without applying PAYE tax and National Insurance.
You may have seen some information in the press or heard from HMRC (Her Majesty’s Revenue & Customs) with an invitation to sign up to use your ‘personal tax account’. The reason for this is that HMRC are beginning to phase out tax returns as we know them. Instead, they plan to bring in “real time” reporting for taxpayers. It’s early days so we don’t yet know the finer details of the scheme but we’ll let you know about developments as soon as we know what they are.
What we do know is that taxpayers will be able to access and manage their Personal Tax Accounts via mobile devices such as tablets and smart phones as well as from PCs and laptops. HMRC will populate each personal tax account with information already available to them, which may help with the reporting of income. Eventually, as the system develops taxpayers will need to report their income and capital gains quarterly. It may come as no surprise that in time taxpayers will also need to pay the tax due every quarter – which is one of the attractions of the new system for HM Treasury.
Taxpayers in dispute with HMRC will now have to pay a fee if they wish to take the Revenue to tribunal. This recent government decision has provoked criticism from lawyers and accountants concerned that the introduction of fees may prevent some from accessing justice over their tax bills.
The proposed fees range from £20 for appeals against fixed tax penalties of £100 or less, to £2,000 for an appeal hearing in the Upper Tribunal or Chancery Court. Although fees at the lower end of this scale are relatively small, fears have been raised that the existence of a fee at all may deter taxpayers from appealing against HMRC and may be increased in the future.
Indeed, when fees for employment tribunals were introduced in 2014, the number of claims fell by 80%.
The National Minimum Wage has been in force for a number of years now. However, agricultural businesses in Wales also have to abide by the Agricultural Sector (Wales) Act 2014, which sets minimum wage rates for staff at different grades of skill and responsibility.
Following the most recent Order, the minimum levels increased by 6% to the following rates, which came into force on 26 February:
From 6 April 2016, the provision of tax and NIC relief for employees will mean that they will no longer receive a P11D, nor need to claim a deduction for genuine business expenses reimbursed by their employer. Therefore, HMRC is withdrawing all company dispensations at the end of the current tax year.
Instead, such business expenses will be treated as exempt from tax and NIC. However, employers will need to have systems in place to ensure that the expenses being reimbursed are exempt business expenses and that the expenditure has actually been incurred by the employee.