June 2011VAT crack-downJune 28, 2011 HMRC will start a campaign later this year to investigate traders who declare turnover just below the VAT threshold. HMRC suspect any trader in this position of depressing their true sales to stay outside the VAT net. However, many small businesses who sell only to the general public, deliberately decline extra work if the extra income would take their turnover over the VAT threshold. This is not illegal just sound business practice, as it protects their prices from 20% VAT, and avoids administration costs. However, it is very difficult to prove there were no undeclared cash sales. HMRC to target VAT cheats Business record checksJune 24, 2011 If you business is picked for a business records check (BRC) please consider asking us to attending the visit to ensure the Tax Inspectors stick to their brief. Problems reported so far include:
The standard letter issued after a BRC visit includes a promise by HMRC to return within three months, outside of the trial phase, when penalties can be imposed. HMRC update on business records checks Taxman audits charity claimsJune 22, 2011 Charities and Community Amateur Sports Clubs (CASCs) can reclaim tax from HMRC in respect of donations they receive under the Gift Aid scheme. The Tax Office occasionally examines individual Charities or CASCs to ensure the Gift Aid scheme is being operated correctly. This examination is called an audit. The organisation will normally be given 30 days to correct any errors. We can help you understand the records you need to keep under the Gift Aid scheme. Guidance for charities to correct errors Repayment claim formsJune 21, 2011 Some paper repayment claim forms issued for 2010/11 (forms R40) contain a printing error on page 2. The tax year end is shown as 5 April 2012 when it should read 5 April 2011. HMRC will accept these forms as applying to 2010/11, and you should complete the form with the details for that tax year, ignoring the error. Ask us if you need assistance with your tax repayment claim. Notes on how to complete form R40 P11D addressJune 20, 2011 The address for submitted paper forms P11d and P11d(b) for the tax year 2010/11 has been changed to: HMRC NIC&EO The forms P11d and P11d(b) can be submitted electronically, and we can help you with this. If you want to submit paper forms please use the above address. Advice on P11d forms - CLICK HERE TO READ MORE
Advisory fuel ratesJune 16, 2011 The advisory fuel mileage rates (AFRs) have been revised for journeys taken on and after 1 June 2011 (see link below). The AFRs are a guide for employers who wish to reimburse the cost of fuel used for business journeys company cars, where the fuel is paid for by the employee. The employer is not obliged to use the AFRs, and can use different rates if the vehicle fleet typically less or more fuel-efficient than average cars, where this can be shown to be the case. New advisory fuel rates VAT registrationJune 14, 2011 You must become VAT registered when your business turnover for 12 consecutive months reaches £73,000 (from 1 April 2011). However, where you operate more than one business in your own name the turnover from all those businesses is generally aggregated to determine if the VAT registration threshold has been reached. Having said that you do not include turnover of a partnership business which you a member of, or of a company where you hold all or some of the shares. This is because partnerships and companies are separate legal entities to sole traders for VAT purposes. Registering separate businesses for VAT Corporation Tax returnsJune 13, 2011 The HMRC software that accepts corporation tax returns filed online has not been updated for the new corporation tax rates that came into effect on 1 April 2011. So companies that are due to pay corporation tax at anything other than the small profits rate (20%) cannot yet file their corporation tax return for a period that ends after 31 March 2011. The next upgrade to the HMRC software is expected in October 2011, after which it should be possible to file all corporation tax returns. Returns requiring the new CT rate Severance payJune 8, 2011 It used to be easy to tax severance pay paid after the employee has left and the P45 form has been issued. In the past a BR (basic rate) tax code was applied which meant only basic rate tax at 20% was deducted. Since 6 April 2011 employers are required to apply an OT tax code on a month 1 basis to severance payments made after the employee has left. This means tax is deducted at the basic, higher and additional rates without the benefit of the personal allowances. Income Tax (PAYE)(amendment) regulations (SI 2011/729)
Anti-money laundering regulationsJune 3, 2011 Do you need to be registered with HMRC under the anti-money laundering regulations? All accountants, lawyers and currency exchanges need to be registered either with their trade body or HMRC, but so do the following types of businesses: Who needs to be registered under the MLR What are trust or company service providers
Tax investigation teamsJune 2, 2011 If you are in the restaurant trade you need to be aware that specialist Tax Office investigation teams are primed to investigate restaurants in the London area. Other trade-specific tax teams will be formed to look at different types of businesses over the next two years. These specialist teams cannot force entry to a business premises and do not have search powers, but you need to be prepared. Talk to us to plan what to do if this crack tax team comes knocking on your door unexpectedly. New tax investigation teams
French propertyJune 1, 2011 Do you have a second home in France? If it is not let-out you may have to pay an additional annual property tax of 20% of the cadastral value (similar to rateable value). This new tax is currently being considered by the French Parliament, and if the law passed it will apply from January 2012, but only where the property owner is not resident in France. Ask us for further details as there are other exemptions. New French property tax |
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