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Thank-you and sorry says HMRC chief
Payroll staff gather half of all Government revenue, some £220bn, or around twice the annual budget of the NHS, Don Macarthur, head of HM Revenue & Custom's Employer Programme, told the conference. 'The more we can do to help you, the better we can meet our objectives,' he said. 'We never hear from the vast majority of tax-payers. That is thanks to you.' He added: 'The more we can do to help you, the better we can meet our obligations to Government.': Mr Macarthur said the HMRC is currently devising a new approach to penalties but said the updated version of the Employer's CD-Rom, which caused so much controversy among software providers recently, should help payroll departments. He said the new penalty regime targeted underlying behaviour, not accidental mistakes but said: 'Hopefully, the more you use the software, the fewer errors will be made.'
Sat, 21 Apr 2007 • Read more
Revenue 'not ready' for CIS
The new Construction Industry Scheme, due to come into operation this week, is complex and the HM Revenue & Customs is not ready for implementation, according to a payroll bureau director.: Carolyn Walsh, director of Southend-based bureau Insite123, which has around 20 construction clients, said: ‘The old CIS was very easy: anyone could make an 18% CIS deduction at the end of the month. Now you will have to use a computer; there are many construction companies that do not even possess a PC. The new system is more complex.
Mon, 2 Apr 2007 • Read more
NI and income tax thresholds to align
Gordon Brown delivered an essentially ‘no-change’ Budget for 2007/08, while announcing radical changes for 2008/09 and beyond.: The headline-grabbing reduction in the basic rate of income tax from 22p to 20p, and the abolition of the 10p starter rate will not come into effect for another year; indeed will not be subject to a Commons debate and vote until then – by which time we will almost certainly have a new Chancellor.
Mon, 2 Apr 2007 • Read more
Penalties loom for online filing of in-year forms
HM Revenue & Customs is proposing penalties for failing to file in-year forms such as P45 (1), P45 (3) and P46 online.: Under recommendations made by Lord Carter in his latest report, Carter II, employers with 50 or more employees must send these in-year forms online by April 2008. Employers with fewer than 50 employees must send these details online by April 2010. Lord Carter’s report sprang from an announcement by Paymaster General Dawn Primarolo to review HMRC’s online services for all the main tax administrations in July 2005.
Wed, 28 Feb 2007 • Read more
Returns with errors were 120,000 for 2004/05
Some 120,000 annual PAYE returns for the tax year-end 2004/05 were accepted with errors when they should have been rejected, the Paymaster General Dawn Primarolo told the Commons last month.: She admitted that, as a consequence, returns had to be manually processed and that not all were completed before updating the National Insurance Recording System (NIRS). As a consequence, thousands of NI-payers received incorrect Deficiency Notices, wrongly advising them that they had to increase contributions. Phil Nilson apologized for this error at last autumn’s Payroll World conference.
Wed, 28 Feb 2007 • Read more
Huge rise in P14 rejections, Revenue figures show
There was a sharp rise in rejected end-of-year forms at HM Revenue & Customs, according to figures obtained by Payroll World under the Freedom of Information Act.: Those rejected at the Electronic Data Interchange shot up from around 20% to 40%. This was accompanied by a roughly three-fold increase in total traffic, from 13.4 million to over 60 million.
Wed, 28 Feb 2007 • Read more
Inspectors' incentives
Tax inspectors are being offered cash bonuses of up to £2,000 by HM Revenue & Customs to encourage them to collect more money from individuals and businesses.
Thu, 1 Feb 2007 • Read more
Primarolo confirms £225m incentives in first year
The Paymaster General Dawn Primarolo has confirmed that payouts under the e-filing incentive scheme for small companies have totalled £225.2m for the year 2005/06; five times the initial estimate of £40m given by the Government in its regulatory impact assessment.: She made the announcement in a Commons written answer, replying to Liberal Democrat Treasury spokesman Vince Cable. The move followed the revelation of the higher payment in the December issue of Payroll World.
Thu, 1 Feb 2007 • Read more
'Son of HCI' may have potential
Smart use of tax breaks can make provision of personal computers for staff a highly efficient benefit, despite the loss of the Home Computer Initiative, according to a leading tax specialist.: The Government’s HCI, which enabled employees to acquire computer equipment with tax/National Insurance savings when allied to a salary sacrifice scheme, was abolished for new schemes last year.
Thu, 4 Jan 2007 • Read more
E-filing payouts to top £750m
Aggregate payouts from HM Revenue & Customs through the e-filing incentive scheme for small companies are on course to top £750m by 2010, research by Payroll World has found. This is around 80% more than anticipated.: The seemingly trivial annual tax rebate of £250 is received by each small employer for the first two years of the scheme, 2004/05 and 2005/06, tapering to £75 by 2008/09. The incentives are received for electronic filing of end-of-year forms P14 and P35 by PAYE schemes with fewer than 50 individuals.
Tue, 21 Nov 2006 • Read more
HMRC gears up for fraud
Taxpayers could face 10 years in prison for a failure to disclose information, as HM Revenue & Customs (HMRC) gears up to treat misdemeanors more seriously.: HMRC is to receive new powers to prosecute taxpayers for fraud for deliberately failing to disclose information where they have a legal requirement to do so, according to UHY Hacker Young, the national accountancy group.
Tue, 31 Oct 2006 • Read more
Tax-free bikes get going
Employers and bicycle shops have registered a surge in provision of loaned bikes to employees as a tax-free perk, especially in London.: Britain's biggest bike retailer, Halfords, said it was providing more than 500 companies, including Royal Mail and Boots, and major banks with fleets of corporate bikes.
Thu, 19 Oct 2006 • Read more
Paying tax twice
The Special Commissioners of the Inland Revenue have stated that an employer can be forced to pay full PAYE tax and National Insurance in respect of an employee, without giving credit for tax already paid by the employee because he believed he was self-employed.: In Demibourne Ltd v Inland Revenue, the Frensham Pond Hotel in Surrey allowed handyman Rodney Bone to stay on after retirement. They agreed it would be on a self-employed basis. Between 1993 and 2002, he stayed on at the hotel but PAYE was not operated. Mr Bone sent annual accounts to the Revenue and paid his tax and National Insurance directly. In 2002, the Inland Revenue (now HMRC) decided that Bone was an employee, and that the PAYE scheme should have been operated. It issued a tax determination for the full amount of tax and National Insurance to the employer, demanding around £15,200. The employer argued that it should have credit for the tax which Mr Bone had already paid.
Fri, 6 Oct 2006 • Read more
HMRC raises funeral concerns
The funeral profession has received guidance from HM Revenue & Customs that could end years of uncertainty over the employment status of choristers, grave diggers and church organists.: The taxman has been concerned that cash payments made on behalf of the bereaved have been banked without tax being paid. In the past, funeral directors have also been lax in keeping records of these payments and some have now found themselves subject to inspections.
Fri, 6 Oct 2006 • Read more
More bandwidth needed for HMRC
There is a pressing need for HM Revenue & Customs to increase bandwidth on its Gateway internet connection, as delays are continuing for online filing, the Business Application Software Developers Association (BASDA) has said.:
Thu, 21 Sep 2006 • Read more
Wrong helpline: HMRC correction
The incorrect Employer’s Helpline number has been issued on the reverse of reminders titled, ‘Payment of Class 1A NICs’ at the end of June, said HMRC. The number quoted showed 0845 7143 149 but should have been 0845 7143 143. HMRC said this would be corrected on future re-prints of this form and apologised for inconvenience caused.
Fri, 1 Sep 2006 • Read more
HMRC seeks more powers
HM Customs & Revenue is to seek views on how it can modernise the way it investigates tax crime. A consultation document has been published on provisions in the Police and Criminal Evidence Act (PACE). Currently, those powers are only available for specific taxes and duties. The Revenue said: ‘Existing powers for investigating suspected tax crime can be cumbersome. Modernising these provisions would give trained officers harmonised powers to apply for search warrants and production orders, and powers of arrest across all taxes.’ The deadline for submitting comments is 1 November 2006.
Fri, 1 Sep 2006 • Read more
Firms unaffected by HMRC merger
Nearly 80% of directors, financial directors and senior directors of 500 small- and medium-sized businesses (SMEs) have noticed no difference at all in their relationship with the taxman since the merger last year, according to research by think-tank Tenon Forum.: Only 8% of directors have noticed a positive change in their relationship with Her Majesty’s Revenue & Customs.
Fri, 4 Aug 2006 • Read more
Rise in NINOs to migrants
The number of migrants given National Insurance numbers (NINOs) jumped by 51% in the 12 months to the end of March, according to official figures.: The rise to 662,000 was caused mainly by immigration from eastern Europe, particularly Poland. Only the UK, Ireland and Sweden initially allowed free access to workers to EU accession countries.
Fri, 4 Aug 2006 • Read more
New rates for company cars
New fuel rates came into force from 1 July, the HMRC has announced. The rates apply on all journeys on and after that date. The full announcement is at: www.hmrc.gov.uk/cars/fuel_company_cars.htm: The advisory fuel rates (guidelines on fuel only mileage rates for company cars) were first published in January 2002. It has been possible to use them since then to negotiate dispensations for mileage payments for business travel in company cars.
Fri, 4 Aug 2006 • Read more
