The prime minister recently said the 50% rate of tax on those earning more than £150,000 would continue. He did not say for how long and it was intended to be temporary, so will it stay until the next election?
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
HMRC has apparently told the BBC that no fines will be levied on anyone who submits their self-assessment tax return online in the first two days of February. On a similar basis, those who have tax to pay will not face any interest on payments made on 1 and 2 February
The official deadline for submitting forms is 31 January, but a planned strike for that day is set to cause last-minute disruption, hence the filing extension. It would be nice though if HMRC were to update their website for this - the front page still says if you do not submit your return by 31 January a £100 minimum fine will be charged.
HMRC is introducing a a more stringent penalty system this year with a £100 penalty applying whether or not there is tax owed. Penalties then increase depending on how late the return or payment is, up to £1,300 after six months and £1,600 after a year.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
The regional NIC holiday for new businesses does not seem to have had a huge take up. Press reports indicate that in total only around 10,000 businesses have claimed the relief rather than the anticipated 40,000.
Just as a reminder, new businesses set up in qualifying areas, including Northamptonshire, can save up to £5,000 in NIC for each of the first ten employees for the first year of business.
The scheme applies to new businesses set up between 22 June 2010 and 5 September 2013. As ever, there are detailed requirements to be met, but the relief is generous and is certainly worth looking into.
Full details on the areas and businesses that can claim the relief can be found on HMRC's website.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
The Behavioural Insight Team has suggested that HMRC create a prize draw, for those that file tax returns on time, to try and persuade people to file before the 31 January deadline. The proposal is for a prize of £100,000 for one lucky taxpayer who meets the filing deadline.
Apparently, similar schemes have been undertaken by some London local authorities that created a £25,000 prize draw for people paying their council tax by direct debit. The scheme seems to have been very successful.
HMRC has indicated that it is an interesting proposal. The new penalties on late returns could cost up to £1600 and if, in addition, people who file late are excluded from a potential £100,000 prize draw it may encourage compliance.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
In the build up to the 31 January payment deadline, HMRC has confirmed that it will never ask for credit or debit card details in emails.
Apparently there are some fake tax emails being sent out by fraudsters, in the run-up to the self-assessment deadline of 31 January, asking for credit card or bank details. Legitimate emails from HMRC will never ask for these.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
HMRC is asking for more businesses to volunteer for the pilot of its PAYE Real Time information Initiative (RTI).
It appears that, currently, 300 businesses have agreed to pilot the scheme, which involves employers submitting PAYE returns at the same time as employees are paid. Testing will begin in April 2012 and RTI will be compulsory for all businesses in October 2013.
HMRC wants over 1,000 more businesses to volunteer to pilot the scheme and is looking for an additional 250,000 businesses to join RTI from November 2012, following initial findings.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
The government has decided not to proceed with its proposal to list high-risk tax avoidance schemes and impose additional penalties for users of these. The difficulties of implementing such a list in a way that was proportionate proved insurmountable. Apparently the government will explore alternatives later this year.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
HMRC has announced its latest series of disclosure campaigns for electricians and electrical fitters. The plan will start in February 2012 and is likely to have terms similar to those previously offered to plumbers and medical professionals. For the purposes of the disclosure facility an electrician can be defined as anyone who installs, maintains and tests electrical systems, equipment and appliances under stringent safety regulations.
As an incentive for disclosure under this campaign, HMRC has opened investigations into 600 plumbers in addition to making five arrests against people who did not take advantage of the last disclosure opportunity. It would appear that the chance of HMRC pursuing those who fail to make a disclosure has increased.
HMRC has also announced a further campaign, for later in 2012, for those who are using e-marketplaces to buy and sell goods as a trade or business.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
HMRC has announced new fuel rates for company cars for all journeys on or after 1 December 2011.
The amounts are:
|
Engine size |
Petrol |
LPG |
|
1400cc or less |
15p |
10p |
|
1401cc to 2000cc |
18p |
12p |
|
Over 2000cc |
26p |
18p |
|
Engine size |
Diesel |
|
|
1600cc or less |
12p |
|
|
1601cc to 2000cc |
15p |
|
|
Over 2000cc |
18p |
|
|
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns |
HMRC has confirmed that it is preparing to appeal against a decision from last year on tax penalties in which it was criticised for being unfair and, in fact, for using its penalty regime as a “cash generating scheme”.
HMRC had levied penalties on late filing of a PAYE end of year return P35, but on appeal by the company, the penalties were cancelled because HMRC waited several months before sending out notices, by which time the penalty had increased. The judge stated HMRC could not be seen to be acting fairly where it deliberately refrained from sending a penalty notice for four months or more, knowing that the effect would be to impose a minimum penalty of £500. As part of the ruling, the judge also commented that it should be a simple matter for HMRC to program its computers to send out the P35 penalty notices in May rather than September, so the fines did not automatically increase.
HMRC described the arguments as “out of kilter” with the law and so are preparing to appeal. HMRC holds that it has no specific responsibility to remind people to put in their returns or when a trigger point for a penalty may be imminent and cannot provide a general reminder service. It's view is that the UK tax system works on the principle that it is a taxpayer’s responsibility to comply with their tax obligations and HMRC is entitled to charge penalties where those obligations are not met.
The appeal will be watched with interest and I have to hope that the ruling again favours the taxpayer or HMRC will be able, as it did last year, to issue penalties only after they have reached a substantial level.
Cathy Corns is a tax adviser and a partner at Mercer & Hole. The views given in this blog are personal to the author, if you would like to discuss the contents of this post with Cathy you can call her on 01908 605552. Email Cathy Corns
Enter keywords:
