Mercer & Hole’s Business blog -

The new PAYE reporting regime is now live and it seemed sensible just to look again at penalties. 2012/13 tax year  Provided the final submission of year end return is made by 19 May 2013, no late filing penalty will be levied. For employers who were in the RTI pilot any corrections should be made by the final submission for 2012/13.  Where this is not the case the existing penalties for inaccurate returns can be levied.  HMRC can already look back at the end of the year to see if an employer has failed to pay its PAYE on time on...

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The EC has launched two consultations on measures to improve tax collection and compliance across the EU. The first consultation is on the development of a European Taxpayer’s Code, which would clarify the rights and obligations of both taxpayers and tax authorities.  The second consultation is on a European Tax Identification Number which would assist the identification of taxpayers in the EU.  The measures are aimed at tackling tax fraud and evasion. ...

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The specific VAT changes announced in the Budget are some of the lowest-key for quite some time, possibly a reaction to the outcry last year on pasties, caravans etc and a concern over perceived impact on economic growth.  Intriguingly, the General Anti Abuse Rule (GAAR) does not specifically address VAT. Registration VAT registration thresholds are undergoing their annual update with effect from 1 April (registration threshold increased to £79,000 from £77,000, and deregistration limit increased to £77,000 from £75,000). Fuel Scale Charges Fuel scales charges (for calculating VAT claimable on fuel, where some private use is involved) are also being...

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A somewhat varied range of issues on shares was promised in the Budget: •  To encourage the market in shares of smaller companies, the abolition of Stamp Duty on shares listed on AIM and similar markets from April 2014. •  A consultation was announced on the possibility of capital gains tax relief on the sale of a controlling interest in a business into an employee ownership structure and on further incentives in this area, including measures targeted at employees through indirect ownership models.  •  The new employee owner status (shares being given in exchange for relinquishing employment...

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As part of his stated aim of giving the UK the most attractive tax regime for businesses, the Chancellor has announced changes intended to benefit organisations at both ends of the spectrum: Larger – or at least more profitable – companies will see the top rate of corporation tax fall to 20%, from April 2015. This is likely to be the last step in a phased reduction in corporation tax rates, as all companies will pay corporation tax at the same rate, from that date. It also means that the UK’s corporation tax rate will be up to 20% lower than...

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The Government’s commitment to providing help with childcare costs is a welcome boost for working families, albeit the assistance is being phased in from autumn 2015.  The relief will initially help families with children under age 5 and will be extended over time to include children under 12. To be eligible for the relief, both parents must work with each earning below £150,000 and not be receiving tax credits or the universal credit.  The current proposal, which is subject to consultation, is that the government will pay 20% child care costs up to £6,000 ie £1,200 per child.    ...

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By 2015 there will be a single 20% rate of corporation tax. Does this mean corporation tax will fall into a similar regime as income tax and that all companies will pay corporation tax by instalments? ...

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The Chancellor has announced the introduction of a new allowance of up to £2,000 per year for all businesses and charities, which will reduce their employer’s national insurance liability from April 2014. The finer detail has still to be sorted – the Government will consult with “stakeholders” on its plans, the hope being that legislation will be introduced later this year. ...

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As ever the devil is in the detail –the continuing relief for reinvesting gains in SEIS shares will apply to gains accruing in 2013/14 when those gains are reinvested during 2013/14 or 2014/15 but  the relief will apply to only half the qualifying re-invested amount. One very welcome piece of news though is the removal of the anomaly where the legislation prevented a company from qualifying under SEIS where it was initially established by a corporate formation agent.  This will apply in respect of shares issued on or after 6 April 2013. ...

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The Chancellor announced an increase in the threshold for exemption from interest tax on employment-related taxable cheap loans.  With effect from April 2014 loans up to £10,000 may be made – to cover the cost of season tickets for example – with no tax charge on a benefit in kind. ...

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