The Summer edition leads on changes to VAT for the construction sector and an article on the potential advantages of deferring your state pension.
The May edition details the changes to Entrepreneurs' Relief and the potential pitfalls when claiming Capital Allowances on some assets.
The Spring edition of the newsletter highlights changes to IR35 and capital allowances
This edition looks at VAT in the food sector and features an article on Inheritance Tax.
Making Tax Digital is on the horizon and this edition gives an overview of the changes.
This edition includes articles on paying dividends, the new Scottish income tax bands and inheritance tax.
In order to try and ensure that businesses are ready to trade post-Brexit, HMRC is automatically enrolling them in the customs system.
HMRC has confirmed that more than 88,000 VAT-registered businesses across the UK will be allocated an Economic Operator Registration and Identification (EORI) number in order to enable them to keep trading with customers and suppliers in the EU after the UK has left.
The government announced that 72,000 businesses have already registered for EORI numbers and numbers will be allocated to VAT-registered businesses to speed up the rollout of the scheme and help ensure the smooth transit of goods.
EORI numbers are a unique ID number allocated to businesses that enables them to be identified by Customs authorities when doing business with other traders.
HMRC has warned that if businesses do not have an EORI number post-Brexit, they will be unable to continue to trade with EU Member States.
Internet link: GOV.UK news
In the latest Trusts and Estates Newsletter HMRC has confirmed the continuation of the interim arrangement for interest reporting.
In 2016 the requirement for payers to deduct tax at source on bank and building society interest was removed and income from these sources is now paid gross. Due to this change, trustees and personal representatives had increased reporting requirements.
HMRC introduced an interim arrangement so trustees do not have to submit returns, or make payments under informal arrangements, where the only source of income is savings interest and the tax liability is below £100.
HMRC has confirmed that these arrangements have been extended to include the 2019/20 and 2020/21 tax years. The situation will continue to be reviewed in the longer term.
Contact us for help with trusts.
Internet link: GOV.UK Newsletter
New company car advisory fuel rates have been published which take effect from 1 September 2019. The guidance states: 'You can use the previous rates for up to one month from the date the new rates apply'. The rates only apply to employees using a company car.
The advisory fuel rates for journeys undertaken on or after 1 September 2019 are:
|1400cc or less||12p|
|1401cc - 2000cc||14p|
|1400cc or less||8p|
|1401cc - 2000cc||10p|
|1600cc or less||10p|
|1601cc - 2000cc||11p|
HMRC guidance states that the rates only apply when you either:
You must not use these rates in any other circumstances.
The Advisory Electricity Rate for fully electric cars is 4 pence per mile. Electricity is not a fuel for car fuel benefit purposes.
If you would like to discuss your car policy, please contact us.
Internet link: GOV.UK AFR
HMRC has confirmed that it will continue its risk-based approach to payroll Real Time Information (RTI) late filing and late payment penalties this tax year.
Rather than late filing and late payment penalties being issued automatically, HMRC will continue to issue them on a risk-assessed basis during 2019/20. HMRC has also confirmed that penalties for 2019/20 will be issued from September 2019.
The August issue of the Employer Bulletin confirms:
'HMRC will not charge penalties automatically for 2019/20, provided a Full Payment Submission (FPS) is filed within three days of the payment date. Where there is a pattern of persistent late-filing within three days of the statutory filing date, employers will be reviewed and may be charged a filing penalty as part of HMRC's risk-based approach.'
The deadline for cleared electronic payments is the 22nd of the month following the end of tax month. For cheque payments or other non-electronic methods, payment is due by the 19th.
HMRC may charge interest on the amount outstanding for late payment, which will accrue until the total amount is paid. Contact us for help with payroll matters.
Internet link: Employer Bulletin
Two self assessment deadlines are approaching:
For those individuals who have not previously completed a tax return but need to report a liability for 2018/19.
For those individuals who have previously submitted 'paper' self assessment tax returns the deadline for the 2018/19 return is 31 October 2019. Returns submitted after that date must be submitted electronically or they will incur a minimum penalty of £100. The penalty applies even when there is no tax to pay or the tax is paid on time.
If you would like any help with the completion of your return, please do get in touch.
Internet link: HMRC deadlines
HMRC has published the latest edition of the Employer Bulletin. This guidance for employers, and their agents, includes articles on:
For help with payroll matters, please contact us.
Internet link: Employer Bulletin
The Financial Conduct Authority (FCA) has agreed a plan to give the payments and e-commerce industry extra time to implement Strong Customer Authentication (SCA).
From 14 September 2019, new European Union (EU) rules apply that impact how banks or payment services providers verify their customers' identities and validate payment instructions. The Strong Customer Authentication (SCA) rules are intended to enhance the security of payments and limit fraud.
The FCA has agreed an 18-month plan to implement SCA with the e-commerce industry which includes card issuers, payment firms and online retailers. The plan reflects the opinion of the European Banking Authority (EBA) that more time was needed to implement SCA given the complexity, lack of preparedness and the potential for a significant impact on consumers.
Jonathan Davidson, Executive Director for Supervision – Retail and Authorisations, said:
'The FCA has been working with the industry to put in place stronger means of ensuring that anyone seeking to make payments is not a fraudster. While these measures will reduce fraud, we want to make sure that they won't cause material disruption to consumers themselves; so we have agreed a phased plan for their timely introduction'.
The FCA has confirmed that it will not take enforcement action against businesses if they do not meet the relevant requirements for SCA from 14 September 2019 in areas covered by the agreed plan as long as there is evidence that they have taken the necessary steps to comply with the plan. At the end of the 18-month period, the FCA expects all businesses to have made the necessary changes and undertaken the required testing to apply SCA.
Internet link: FCA press release
The government has published the draft legislation for the next Finance Bill including the rules for off-payroll working in the private sector. The legislation is open for consultation until 5 September 2019.
The new rules will apply from April 2020 and the effect of these rules, if they apply to intermediaries, typically Personal Service Companies (PSC), will be:
Please contact us for advice on how these changes will impact your business.
Internet link: GOV.UK finance bill
From April 2020, the government will introduce a new 2% tax on the revenues of search engines, social media platforms and online marketplaces which derive value from UK users. However, this only applies when the group's worldwide revenues from these digital activities are more than £500m and more than £25m of these revenues are derived from UK users.
Jesse Norman, Financial Secretary to the Treasury and Paymaster General, said:
'The UK has always sought to lead in finding an international solution to taxing the digital economy. This targeted and proportionate Digital Services Tax is designed to keep our tax system in this area both fair and competitive, pending a longer term international settlement.'
From 6 April 2020, insolvency legislation will be amended to move HMRC up the creditor hierarchy for the distribution of assets in the event of insolvency by making HMRC a secondary preferential creditor in respect of certain tax debts held by a business (this includes individuals and partnerships) on behalf of their customers and employees. This includes VAT, PAYE income tax and CIS deductions.
The rules will remain unchanged for taxes owed by businesses themselves, such as corporation tax and employer National Insurance contributions.
In addition, directors and other persons connected to companies subject to an insolvency procedure will be made jointly and severally liable for amounts payable to HMRC by the company in certain circumstances. This will apply mainly in cases where the company has engaged in avoidance, evasion or 'phoenixism'.
Internet link: GOV.UK insolvency