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Watford Business Park
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 Tel: 01923 447600
Fax: 01923 447666

mail@warnersCA.co.uk

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Sat: By appointment

More on Class 1A NI 6/8/13

If your business has Class 1A NI to pay (relating to P11D benefits) and has still not made payment to HMRC then beware of the 5% penalty which will be charged if it is still unpaid on 18 August (22 August if payment is made electronically).

P11Ds and Class 1A NI 22/6/13

Benefits and (where appropriate) expenses for 2012/2013 must be reported on form P11D by 6th July - automatic penalties apply for failure. Any Class 1A NI liability should be paid by 19th July using the separate payslip you will have received from HMRC

PAYE payment - don’t be late 11/6/13

Given that the latest date for your monthly electronic payment (22nd) falls on a weekend this month, remember to pay beforehand to avoid being late and getting onto the penalty ladder.

Scam e-mails 2/6/13

With the tax year having ended and possible repayments on peoples’ minds, the scammers are hard at work sending e-mails purporting to be from HMRC. We’ve seen a good numbers of examples recently - some much more authentic looking than others but beware, HMRC does not send e-mails about tax repayments. Delete any such e-mails (report them to HMRC if you wish via phishing@hmrc.gsi.gov.uk) but your most important watch points are DO NOT follow any links, DO NOT reply, DO NOT open any attachments. Some may be simply malicious and damaging to your computer and your data, more likely most will be after your bank details. HMRC will never ask for personal details or bank details in this way.

Millions over or under pay tax 18/5/13

HMRC are reported to have said that up to 5.5 million people have under or over paid in the last tax year and, given the huge number, it may be some months before many will be contacted.  This issue (which reports suggest are amounts of typically £300-£500) affects only those who are not in the self assessment system and is due to the inherent inaccuracies in the PAYE system. People with more than one job or more than one pension (including the state pension) are most at risk but many other factors can play a part such as incorrect or outdated information about benefits in kind.

Business Confidence Monitor 16/5/13

Commenting on the latest published results, Michael Izza, ICAEW Chief Executive, says “The continuing rise in business confidence in this quarter’s ICAEW/Grant Thornton Business Confidence Monitor shows that the UK economic recovery continues to strengthen”, although he points out that “we still have some way to go before we return to pre-2007 levels of economic activity”.

Your first RTI EPS reminder 13/5/13

Employers who have matters affecting their PAYE payments (such as CIS tax suffered on sales income or the recovery of statutory payments like SSP, SPP or SMP) should remember that they must file an Employer Payment Summary (EPS) for each affected month. Any EPS required for month 1 must be filed under RTI by 19 May. If we operate your payroll then we will take care of this for you.

HMRC changes 0845 numbers 8/5/13

Appreciating at last that many people are on landline or mobile tariffs which don’t include 0845 numbers, HMRC has changed some of its enquiry helplines to new ordinary national numbers including 0300 200 3600 for the Online Services Helpdesk and 0300 200 3200 for the Employer Helpline (0300 200 3211 for new employers).

P35 and P60 reminder 28/4/13

With all the recent focus on RTI, employers should remember their obligations on the closure of the 2012/2013 tax year. Forms P35 must be filed with HMRC by 19 May to avoid penalty and forms P60 should be distributed to employees by 31 May.

Minimum wage rising 15/4/13

Accepting the Low Pay Commission’s recommendations, the government has today announced the National Minimum Wage increases which will take effect from 1 October. The headline adult rate will increase by 12p from £6.19 to £6.31.

Card charges complaints 14/4/13

Consumer group Which reports that new rules, which came into force 6 April and which limit the amount companies can charge consumers for paying by card to the actual cost the companies incur, are not being adhered to by many companies and that complaints continue with the headline criticism levelled at the travel industry. The Office of Fair Trading is the body responsible for policing the rule but it appears that an effective means of enforcement has yet to be put in place.  

Interest deadline approaching 8/4/13

Any 2012/2013 PAYE/NI not paid by 19th April 2013 will carry an automatic interest charge. Employers should check their payments in good time.

Investor rebates to be taxed 26/3/13

HMRC has announced that rebates paid to fund investors, whether in cash or by way of additional units, will be taxed from April 2013. Fund managers will be obliged to deduct 20% basic rate tax and higher rate tax payers will have further tax to pay as part of their self assessment. There will be no tax on rebates on ISA funds and, providing the rebate is reinvested in the fund without ever reaching the hands of the investor, rebates on SIPP funds will also escape liability.

Taxman to close enquiry centres 18/3/13

To be rolled out in 2014, HMRC is planning to close all 281 of its enquiry centres which have for many years provided face to face advice. It is understood they will be replaced by a telephone service (yeah, right) and the availability of home or business visits (oh, please).

RTI penalties clarified 12/3/13

There will be no penalties for late filing of information under RTI during it’s first year of operation but other penalties, such as those for inaccuracies through careless or deliberate error and those for late payment of PAYE, will continue just as they are at the moment with a less harsh late payment penalty regime coming into play from April 2014. For more details see our hot issues section on this new page.

Portsmouth administrators fees disclosed 28/2/13

It is reported that the latest creditors report shows the club’s administrators PFK have notched up fees of some £2.2m for their work. The club went into administration in February, the second time in two years. PFK is hoping to arrange a sale of the club to avoid liquidation and are awaiting the outcome of a court hearing to determine if a sale is viable - to the Portsmouth Supporters Trust.

Banks to pay out on interest hedge mis-selling 27/2/13

Following FSA findings last year of serious failings by banks in their selling of interest rate hedge products to businesses, and the announcement In January this year that Barclays, HSBC Lloyds and RBS would start full reviews of their sales of these products, it is reported that Barclays hopes to make offers to businesses by the end of March.

Tax deal with Isle of Man 22/2/13

In the continuing drive to close tax havens, an information-sharing deal has been struck between the UK and the Isle of Man under which financial information on UK taxpayers holding accounts there will be reported to HMRC automatically every year. A period is being allowed for taxpayers to come forward to pay any tax due together with a penalty reported to be between 10% and 20%. Such voluntary disclosure is likely to avoid prosecution although it is understood this is not guaranteed.

Business Confidence Monitor 21/2/13

The latest version of the quarterly Business Confidence Monitor produced by Grant Thornton has been published. Read the economists view or see our resources page for the full report and access to previous quarters too.

VAT on room-only hire 11/2/13

Until October 2011, HMRC were happy that the supply of venues on a room-only basis (such as for weddings where the customer provided their own catering) by hotels and similar establishments was not subject to VAT but from that date they changed their view. In a recently issued Business Brief, HMRC has restated its position and expects all relevant businesses to comply from now on.

RTI looming 4/2/13

Real Time Information, the new way of reporting your payroll information to HMRC, starts for most employers is under 10 weeks. Some useful guidance was produced last year in Employer Bulletin 42 and our own detailed commentary and guidance can be found in our hot issues section on this new page.

Jessops closure 11/1/13

The collapse of household names in the high street continues with the announcement today that camera retail chain Jessops will close all of its 187 stores tonight after entering administration only earlier this week.

Waving a red flag at HMRC 10/1/13

It is reported than from next month HMRC will be putting under greater scrutiny the tax affairs of those businesses with outstanding VAT returns.

Insolvency statistics 23/12/12

According to statistics from Moore Stephens, the trend in personal insolvencies has been continuously upwards since 2002 with a peak in late 2006 and an even higher peak in late 2009 and early 2010 and, although they have since fallen back a little, they have remained by the third quarter of 2012 at a level some 4 times higher than in 2002. That is to be contrasted with company insolvencies which declined gradually from 2002 until rising by some 40% to peak in late 2008 & early 2009 since which time they fell off and by the third quarter of 2012 were back at a level something close to that in 2002. Given the severity of the economic conditions and despite the peak in late 2008 and early 2009, the lack of a general increase in company insolvencies means it is likely that there are a great many companies stumbling along without any real hope of returning to prosperity. With creditors patience wearing thin something has got to give so a fresh wave of insolvencies has probably yet to come.

Comet huge cost to public purse 18/12/12

It is reported that the collapse of retail chain Comet will cost the government £23.2 in redundancy payments (to be met by the Redundancy Payments Service) and a further £26.2m in unpaid tax already owed to HMRC according to figures released by administrators Deloittes. The company, which at its height had over 230 stores and employed some 7,000 people, is due to close the last of its stores today.

UK and Isle of Man agreement 7/12/12

The Treasury has announced that the government is to sign an enhanced tax information sharing agreement with the Isle of Man which will provide HMRC with a range of additional information about potentially taxable income in Manx bank accounts. Exchequer Secretary to the Treasury David Gauke said “This agreement will significantly boost the UK’s ability to tackle cross-border tax evasion”. This comes hot on the heels of the recently much publicised Swiss-UK agreement, originally signed in 2011 and starting in January 2013, under which the Swiss will tax the bank accounts of UK citizens and send the cash to HMRC but without revealing the identity of the account holders. Some commentators have criticised the government for making a quick buck (albeit a potentially huge one) but allowing the possibly illegal underlying activities to continue unchallenged (for now at least).

HMRC sends letters to scheme users 1/12/12

HMRC has sent letters to a reported 1,500 people who have used a particular tax avoidance scheme. It is thought that the letters, the first of their kind, were issued ahead of a legal challenge to the scheme to be made by HMRC. The identity of the scheme in question has not been published.

Italian tax ‘irregularities’ 25/11/12

Tax-News.com today reports that according “redditometro” (a computer system which crosschecks taxpayers' income declarations with their spending habits) more than 4.3m families declared income that was inconsistent with their known expenditure with further irregularities apparent in the profits of companies. Almost 1m families declared an income which was "very close to zero," while spending much more. It is understood that this won’t lead to an automatic assumption that income has been under-declared but it will certainly lead to enquiries to establish the facts.

Pension cap cut proposal 21/11/12

Reported government proposals could see another reduction in the maximum amount people can save into a pension each year while getting tax relief. The annual maximum, which before the 2010 emergency budget stood at £255,000, is currently £50,000 but could be cut to £40,000 or even £30,000. Reports suggest that such a cut is expected to save the government £600 million (£1.8 billion if the cut was to the £30,000 level).

Insolvent Comet to close 30 stores 17/11/12

Retailer Comet, recently placed in administration putting more than 6,000 jobs at risk and with some 330 headquarters job losses already announced, is preparing to close 30 stores by the end of November. It is reported that the other 200 or so stores are expected to continue trading over Christmas with their future thereafter remaining uncertain.

HMRC wins parking VAT battle 12/11/12

The Isle of Wight Council, having charged VAT on off-street parking and having paid that VAT over to HMRC, decided that as a Local Authority it should not have charged VAT and so tried to claim it back. At first sight their claim would appear to be valid as much of what is done by such bodies is indeed outside of the VAT net but that comes with one particular proviso - that the absence of VAT does not cause unfair competition in the general marketplace ie the private sector should not be disadvantaged. Clearly it was disadvantaged and on that basis the tribunal ruled in favour of HMRC and the refund claim was denied. This was a first tier tribunal decision and we’re likely to hear more of this case.

Jersey accounts list scrutinised by HMRC 9/11/12

While regulators in Jersey launch an enquiry into HSBC, HMRC reportedly busy themselves reviewing a leaked list of the names and addresses of over 4,000 British account holders at the bank there. It is understood HMRC, who have prosecuted over 200 evasion cases already in this tax year against a target of over 500, have a target to achieve an additional 1,000 evasion related prosecutions a year from next year.

HMRC releases call centre stats 6/11/12

Statistics for performance at HMRC call centres have been released for the first time. Highlights from the statistics, which cover the April 2012 to June 2012 quarter, show that 49% of calls took over 2 minutes to be “answered” , 22% took over 10 minutes and 1% took over 30 minutes and less than 70% of calls were “handled” at all. Whilst the release of figures is to be welcomed, and whilst we should remember that although 1% sounds small it in fact represents some 15,000 calls, the small print reveals that the statistics regard a call as “handled” if the caller got through to the first stage (ie the messages) so that is perhaps not a good guide as to how many callers felt they were actually dealt with.

Child benefit claw-back 4/11/12

Does your household receive Child Benefit? Does either parent have income over 50,000? If so then claw-back is set to begin 7/1/13 and will be dealt with via your tax returns. Oh, you don’t do tax returns? - well you do now! This will be extremely problematical for those who are affected (or who are borderline) so we’re running a Hot Issue on this.

Comet administration 1/11/12
Electrical retailer Comet is set to go into administration next week putting a reported 6,500 jobs at risk.

Officially out of recession 25/10/12
Figures released by the Office of National Statistics showing a 1% growth in the UK economy in the third quarter over the previous quarter, the strongest in five years, were met with reserved acceptance. The Financial Times reported that the third quarter bounce was exaggerated by one-off factors, such as the unwinding of the effect from the Queen’s jubilee bank holiday and the London Olympics. Economists said the underlying growth rate was probably about 0.2 per cent per quarter over the past two quarters, weak by historical standards but better than had been assumed. Overall, the economy is still seen as flat.

Small businesses bearing the brunt 22/10/12
According to Begbies Traynor Red Flag report, which collects data to monitor the early signs of distress in companies, small and medium sized businesses are suffering at the hands of large businesses with a 10.5% increase in stress shown in the third quarter compared to the previous whereas large companies showed a 61% decrease in stress in the same period. It is reported that Sainsbury’s have increased non-food supplier payment terms from 30 to 75 days with similar moves having been previously made by the likes of Dell, Carlsberg and Argos.

Portsmouth FC 21/10/12
The administrators of the club are lining up Portsmouth Supporters Trust as the preferred buyer.

FCMcLaren spying penalty 15/10/12
The McLaren Formula One team has been able to claim that a £32m penalty for spying on rival Ferrari was tax deductible. Had the penalty been for breaking the law the claim would no doubt have been denied but this was in fact paid to the FIA under their internal competition rules - still quite an eye opening result none the less.

Mansion tax abandoned 11/10/12
The conservatives have announced that the proposed “mansion tax” is to be abandoned but still insist that the rich will pay higher taxes.

HMRC signs up for the cloud 06/10/12
It is understood that HMRC is the first government department to sign up for cloud based services. The decision is reportedly based on cost and data security and the transfer of information currently stored in local offices is set for early 2013. We have to applaud HMRC keeping pace with the times but it is almost certain that cost is the major driver and that isn’t always the most sound reasoning.

HMRC extends affluent Unit remit 06/10/12
HMRC’s team targeting the tax affairs of the wealthy is widening its scope. Set up in 2011 to look closer at the affairs of those worth in excess of £2.5m, the threshold is being lowered to £1m. With another unit already dealing with the super rich (those with assets of more than £20m) there is concern that there is a muddled approach.

Barclays ethics drive 25/9/12
Barclays has announced a review of its investment banking service as part of measure putting ethics at the top of its agenda.

JJB Sports in the spotlight 21/9/12
JJB sports have come under investigation regarding VAT wrongly added to children’s clothing.

Taxman’s contact centres expansion 13/9/12
An additional 1,100 staff are to be taken on at the contact centres to help HMRC meet its target of answering 90% of calls. Some £9m has been earmarked for investment in the centres in the current year with a further £25m next year. The Treasury released information earlier this year that a quarter of all calls to HMRC helplines went unanswered after callers waited an average of 5 minutes.

A Business Bank 10/9/12
Business secretary Vince Cable outlined plans for the creation of a bank aimed at dealing with small and medium sized businesses dealing with young people, export support, and cheap loans although business leaders have suggested that the message is muddled, the aims unclear and that it could take decades to get such a system right.

20 most wanted tax dodgers
HMRC has published a list of the names of the 20 most wanted tax dodgers. Pictures have been released too. It is reported that these people collectively owe the public coffers £765m. David Gauke, Exchequer secretary, said the taxman will pursue the criminals relentlessly and it is hoped that publishing this information will enable members of the public to help in the efforts to catch them.

Electronic payment of tax

We recommend that all taxes are paid electronically. Paying by this method is not only secure but also means you should never needlessly incur late payment penalties because your cheque simply didn’t arrive on time. See the “Helpful Stuff” link on our home page to find the precise HMRC bank details and payment reference requirements for all types of taxes.

RTI developments
Keep an eye on our RTI Hot Issue to read our commentary on the very latest developments.

Business Records Checks are back
HMRC is again starting Business Records Checks. The scheme is aimed at identifying those failing to keep adequate records. If you receive a letter from HMRC then contact us IMMEDIATELY so we can call them before they call you. If you miss the boat and get a call then refer them to us rather than answering their questions. This is important so you’ll see we’re running a Hot Issue on it.

Pension rules gap
The abolition of the existing pension rules relating to employers obligations to facilitate Stakeholder Pension (although there was no requirement for employer contributions) creates a gap since, although the new more stringent rules (which do include mandatory employer contributions) came into force on 1 October 2012, most small businesses won’t be affected until 2017. It is unlikely this gap in pension provision was originally intended although the take-up for Stakeholder plans was in any event low.

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