HMRC withdraws ‘little used’ IR35 business tests

HMRC is to withdraw the business entity tests (BETs) intended to help taxpayers assess whether they might be caught by the IR35 legislation, after a review conducted by the IR35 Forum found that the tests were used “very little” and were not fulfilling their intended purpose

Newsletter 85

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

MIS-SOLD INTEREST RATE HEDGING PRODUCTS

Following a review of the way some banks sold Interest Rate Hedging Products (IRHP), some businesses are entitled to redress payments. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-85#MIS-SOLD

GIFT AID AND FREE ADMISSION

HMRC have updated their guidance for charities to explain that the terms and conditions attached to a donation that gives a right of admission to property cannot include a right to a full or partial refund of the admission payment. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-85#GIFT

UK BROADBAND VOUCHER SCHEME OVERHAULED

Businesses are being urged to take advantage of a scheme to get faster, cheaper broadband. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-85#UK

LATEST FAKE ‘HMRC’ PHISHING SCAM

We are aware that there is a new bogus email which is phishing scam aimed at taxpayers. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-85#LATEST

DEADLINE FOR ‘PAPER’ SELF ASSESSMENT TAX RETURNS

For those individuals who have previously submitted ‘paper’ self assessment tax returns the deadline for the 2013/14 return is 31 October 2014. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-85#DEADLINE

LATEST LABOUR MARKET EMPLOYMENT FIGURES

The Office for National Statistics has announced that the latest statistics, based on the period May to July 2014, show that employment continued to rise and unemployment continued to fall. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-85#LABOUR

HMRC Gets it wrong again !

Leaked e-mails from within HMRC allegedly reveal that HMRC have yet again made serious miscalculations of peoples tax liabilities.

Following on from last years fiasco when it admitted that over 5 million people might have been charged incorrectly, attempts at correction have apparently not resolved the issue and notices which advised taxpayers are apparently, and according to HMRC, not demands for tax to be paid!  An HMRC spokesman in admitting the problem has said that it will take 6–8 weeks to resolve the latest issue.  Taxpayers, predominantly those on PAYE who have received refunds have been requested not to cash the cheques!  The leaked e-mail suggests that the miscalculations are due to the changeover to Real Time Information software which businesses now use to calculate payroll.  

HMRC able to take up to £17,000 from taxpayers

News has emerged of HMRC being able to take up to £17,000 from taxpayers as part of its recovery procedures. Walker Thompson wants to clarify here that this is a mechanism to code out larger tax debt via PAYE and is NOT linked to the proposals allowing HMRC access to peoples bank accounts.

The change, expected to raise £115m in the 2015-16 tax year, has aroused less controversy than plans to deduct the money from bank accounts because it spreads payments over the year and does not affect those earning less than £30,000, who will still be subject to a £3,000 limit. HMRC has introduced a sliding scale so only those earning more than £90,000 would face a potential £17,000 deduction. It has also guaranteed that it would not take more than half the salary of those affected.

We assume this means Gross Salary but with certain high earners the tax code already accounts for various benefits in kind such that taking half of salary through additional coding could possibly leave no net pay !

Newsletter 84

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

RTI PENALTIES FOR SMALL EMPLOYERS DELAYED

HMRC have confirmed that employers with fewer than 50 employees will face automated in-year penalties for late real-time PAYE returns from 6 March 2015 which is later than had originally been anticipated. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-84#RTI

VAT FOR DIGITAL BUSINESSES AND THE MINI ONE STOP SHOP

The one-stop VAT service starts from 1 January 2015 for businesses supplying what are collectively known as ‘digital services’ in the EU. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-84#VAT

NATIONAL MINIMUM WAGE RISES

The National Minimum Wage (NMW) is a minimum amount per hour that most workers in the UK are entitled to be paid. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-84#NMW

FUEL ADVISORY RATES

New company car advisory fuel rates have been published which took effect from 1 September 2014. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-84#Fuel

AUTUMN STATEMENT DATE ANNOUNCED AND HAVE YOUR SAY

The government has announced that the Autumn Statement 2014 will take place on 3 December. - See more at: http://www.walkerthompson.co.uk/newsletters/Newsletter-84#Autumn

P11D

The Daily Mail reported yesterday on the thousands of warning letters sent out incorrectly to UK businesses.

HMRC blamed computer updating – or lack of it – for the error which related to penalties for non submission of forms P11D which declare employees benefits in kind.

Many commentators remain concerned that HMRC want the right in law to take treasury debt direct from bank accounts and state that this sort of internal mis-management is exactly why such powers should not be permitted.

One last chance for landlords

HMRC has announced one last chance for landlords who fail to declare all their rental income to come clean - or else take the consequences. 

HMRC estimates that up to 1.5 million landlords may be underpaying up to £500 million in tax every year. Under the Revenue’s Let Property Campaign, landlords who may owe tax – whether through misunderstanding the rules or deliberate evasion – can come forward and declare any unpaid tax, although they will have to pay possible penalties and interest. 

The Revenue says it will be “working with a variety of bodies over the next few months to develop tools and guidance to support landlords of all types and help them get their affairs up to date.”

HMRC says it will use information it holds about property rental in the UK and abroad, along with information already held on its digital intelligence system Connect, to identify people who have not paid what they owe. 

This is also likely to include cross-referencing letting agents’ returns with those of their landlord clients. For investors that fail to come forward, higher penalties – or even criminal prosecution – could follow.

Further details of the amnesty can be found at https://www.gov.uk/let-property-campaign

Courtesy of Alternative Estates Coventry