Tax doesn't need to be taxing - especially if you have a Premium Rate Phone Number

Delays in answering phone calls to HM Revenue and Customs cost callers £136m last year, it has been estimated.

The National Audit Office (NAO) has calculated that members of the public spent £33m on call charges whilst “on hold” with HMRC phone lines in 2011-12, wasting time worth £103m to them.

HMRC uses Cable & Wireless for its 0845 rate services - More …….

http://www.bbc.co.uk/news/uk-politics-20766494

RTI Penalties Announced

Draft Finance Bill 2013 clauses set out new RTI and PAYE late payment filing penalties that won’t come into effect until April 2014

But penalties for filing accuracy will come into force as soon as the Finance Bill receives Royal Assent.

Earlier this month, tax professionals were dismayed at the government’s determination to levy such penalties and concerned that they would have a significant impact upon small businesses.

The Finance Bill amendments may appear to give more leeway to those who take time getting used to the new PAYE filing system.

A relaxation of some of the penalties is really welcome, but the penalties for incorrect returns, which will come into force straight away, don't give small businesses the time they need to adjust to the system.

We believe that the package overall will afford businesses time to come to terms with the system in the first year and identify problems with HMRC

The government said the legislation will encourage compliance with RTI and ensure that non-compliant businesses don't benefit.

There will of course be new late filing penalties for RTI returns including changes to current late payment penalties to ensure they can be charged in-year. The size of the late filing penalties will be based on the size of the PAYE scheme, rather than filing defaults and will include one un-penalised default, whereby the first filing default every 12 months will not attract a penalty.

For penalties relating to inaccuracies, the law is to be amended to allow a tax year to be treated as a tax period under Schedule 24 to Finance Act 2007. For its part HMRC argued the change would reduce the number of separate penalty assessments issued when errors are found.

Other changes to the penalties and late filing regime include: 

• one penalty per month, even if the employer defaults more than once
• charging penalties quarterly (to get money in more quickly)
• considering an easement for new employers who find filing their first returns difficult due to delays registering with HMRC (they procrastinate so why should businesses pay?)
• legislating for an additional tax-geared penalty to apply for returns outstanding more than three months
• considering an assessing tolerance where a small difference in amounts paid for a tax period compared to amount due to be paid as reported on RTI returns will not trigger a payment default (small difference not defined)
• applying interest to late RTI penalties.

According to the documentation, work on secondary law for the new late filing penalties is continuing and will be published for consultation next year.

Newsletter 62

Headlines from our latest newsletter.  Please click on any of the links below for more information :

THE AUTUMN STATEMENT
On 5 December George Osborne delivered his Autumn Statement to the House of Commons.

CHANGES TO VAT ONLINE SERVICES
HMRC have announced various changes to their online services including the introduction of the VAT online registration service which was promised earlier this year.

HMRC CLOSE IN ON ‘TAX CHEATS’
HMRC have launched an advertising campaign warning ‘tax cheats’ to declare all their income before it is too late.

HMRC ANNOUNCE LATEST TARGETS
HMRC have launched new taskforces to tackle ‘tax cheats’

UPDATED APPROACH TO BUSINESS RECORDS CHECKS
HMRC have announced an updated approach to business records checks.

VAT REGISTRATION THRESHOLD NO LONGER DUE TO THOSE NOT ESTABLISHED IN THE UK
A decision in the European Court of Justice has confirmed that only businesses established in a Member State can benefit from its domestic VAT registration threshold.

PARTIES FOR EMPLOYEES
With the season for office parties fast approaching we thought it would be a good idea to remind you of the tax implications.

SIMPLER HEALTH AND SAFETY GUIDANCE
The Health and Safety Executive (HSE) has launched an online 'Health and Safety Toolbox' aimed at smaller, low-risk businesses.

MORE FLEXIBILITY IN THE LEAVE AVAILABLE TO PARENTS
Deputy Prime Minister Nick Clegg has announced that parents will be able to share up to 12 months leave after the birth of a child from 2015.

PAYROLL RTI SYSTEM ‘UNREALISTIC'
The Institute of Chartered Accountants in England and Wales (ICAEW) has warned that the RTI reporting system will be ‘at best unrealistic and at worst impossible’ for small employers.

IMPROVING GENDER DIVERSITY IN BOARDROOMS
The CBI commented on proposals from the European Commission, aimed at achieving a better gender balance in the boardrooms of some European companies.The proposals apply to companies listed on stock exchanges in EU's Member States.

PROPOSAL TO REMOVE RED TAPE ON BUILDING EXTENSIONS The government has announced proposals to make it quicker and cheaper to make improvements to homes and business premises.