To September’s Tax Tips & News, our newsletter designed to bring you tax tips and news to keep you one step ahead of the taxman.
If you need further assistance just let us know or you can send us a question for our Question and Answer Section.
We are committed to ensuring none of our clients pay a penny more in tax than is necessary and they receive useful tax and business advice and support throughout the year.
Please contact us for advice in your own specific circumstances. We’re here to help!
Legislation included in Finance Bill 2016 implements the new 0% rate for dividend income, as well as changing the rates of tax for dividend income. Once enacted, the changes will apply from 6 April 2016. Broadly, the new nil rate applies to the first £5,000 of a person’s dividend income and is available annually. – read more >>
CIOT examines new corporate offence proposals
The Chartered Institute of Taxation (CIOT) has recently expressed its concerns that the new corporate offence of failure to prevent the criminal facilitation of tax evasion may lead to a string of prosecutions in relatively small cases where civil penalties can already provide enough punishment. – read more>>
FB 2016 amendment on OTS appointments proposed
The chairman of the Treasury Select Committee, Rt Hon. Andrew Tyrie MP, recently wrote to the Chancellor of the Exchequer, Rt Hon. Philip Hammond MP, to inform him that the Committee disagrees with his predecessor’s decision not to consent to a recommendation that the Committee be given the right of veto over the appointment and dismissal of the Officer for Tax Simplification’s Chair and Tax Director.
In order to be successful, the Committee says the OTS must be in a position to provide the Government with robust, dispassionate and high-quality advice, which can only be improved if those charged with providing it are independent, and seen to be so. This issue sits independently of the breadth of their scope for making recommendations, which is clearly set out in the provisions of the Finance Bill that put the OTS on a statutory footing.
An amendment has been proposed to the Finance Bill to give statutory effect to this recommendation.
EU consultation on ending VAT on eBooks
The future of the chargeable rate of VAT on digital publications and eBooks is under review as the European Commission (EC) has launched a two-month consultation with a view to abolishing the current full rate VAT. – read more >>
Could HMRC about to triple the fines for late payment of income taxes for SMEs?
If you already feel HMRC’s current system of levying fines for late payment of income tax is draconian, then Steven Glicher accountants has some bad news to impart. HM Revenues & Customs is consulting on changing the system to make it ‘fairer and more transparent’: – read more >>
HMRC announces consultation period for potential changes to benefits-in-kind
If you are an employer who offers your staff in-work benefits-in kind, then you may be interested to hear about the latest government consultation. In the 2016 Budget the government announced plans about a number of potential reforms to salary sacrifice arrangements and changes to benefits-in-kind for both employees and employers. HM Revenues & Customs is now following through on those plans. – read more>>
September Questions and Answers
Q. I have recently changed jobs and need to use my car to make business journeys. Will I have to pay tax on the mileage expenses my employer reimburses me for these trips?
A. Employers can pay employees a tax-free and national insurance-free amount for every mile they drive on business duties, currently:
– 45p per mile for the first 10,000 miles
– 25p per mile for each subsequent mile
– 24p per mile for motorcycles
– 20p per mile for bicycles
– 5p per mile extra for each passenger carried on work-related journeys
If your employer reimburses your mileage at less than these rates, you can claim the balance (but not the 5p per mile passenger extra) against your taxable income. For instance, if your employer gives you 30p per mile for 1,000 miles, you have a 15p per mile shortfall and can claim £150 against your taxable income. The big exception to business mileage is the daily commute from home to work and back again.
Q. When do I need to register for VAT?
A. Changes have been made to the April 2010 edition of VAT Notice 700/1: Should I be registered for VAT? to reflect:
– the introduction of a new online system for registering for VAT; and
– the removal of the VAT registration threshold for non-established taxable persons
Very broadly, you need to register for VAT if your annual turnover reaches the current annual registration threshold limit (£83,000 for 2016/17). This threshold operates on a month-by-month basis, so you need to check at the end of each month to make sure that you haven’t gone over the limit in the previous 12 months. You also need to think about whether you’re going to go over that limit in the following 12 months. If you think you may, you probably need to register.
You can register for VAT even if your turnover is below the threshold and you may actually save tax by doing so, particularly if your main clients or customers are organisations that can reclaim VAT themselves.
You must register with HMRC within 30 days of being aware that you’re going to exceed the threshold. See the gov.uk website at https://www.gov.uk/vat-registration for further information on registration.
Q. How can I make a complaint about a recent HMRC PAYE compliance check at my business premises?
A. Most PAYE compliance reviews are settled by agreement. However, if an amount cannot be agreed upon, HMRC may make a formal determination for the tax underpaid, student loan deductions, and penalties. A notice of decision will be issued for outstanding NICs and statutory payments.
An employer can appeal to the tribunal against any determination or notice of decision within 30 days of issue.
There is a set procedure for dealing with complaints concerning the way an investigation has been conducted. Full details are set out in the HMRC Factsheet entitled Putting things right: how to complain. Broadly, the steps are as follows:
(1) The HMRC officer dealing with the investigation should be contacted in the first instance, or their line manager or the person in charge of the HMRC office.
(2) If the matter cannot be settled, contact the Director with overall responsibility for the office dealing with the investigation. The Director will review the complaint objectively.
(3) Where matters are still not resolved, contact the Adjudicator (www.adjudicatorsoffice.gov.uk). The Adjudicator acts as an unbiased and independent referee. The Adjudicator can be contacted at: The Adjudicator’s Office PO Box 10280 Nottingham NG2 9PF. Telephone: 0300 057 1111/Fax: 0300 059 4513
(4) If at any time a person is not satisfied with the service they are receiving from HMRC or the Adjudicator, they should contact their MP and ask for the case to be referred to the Parliamentary Ombudsman. The Ombudsman accepts referrals from any MP, but the local MP should be contacted in the first instance.
(5) Allegations of very serious misconduct by HMRC staff, such as assault or corruption, are dealt with by the Independent Police Complaints Commission (IPCC).
September Key Tax Dates
19/22 – PAYE/NIC, student loan and CIS deductions due for month to 5/9/2016
30 -Closing date to claim Small Business Rate Relief for 2015/16 in England