Nick Singer - West End Accountant tells it as it is
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Nick Singer is a Chartered Banker and general tax practitioner with west end management consultants and accountants, Independent Accountants in Scotland Limited. Nick established Independent in 2004 to provide a more personalised service for the west end of Glasgow, where he lives.
Nick has a relaxed and informal approach and his desire to contribute to this site was to provide easy to read and comprehensible information on topical tax issues which he thinks would be of interest to everyone who pays tax.
Friday 18 May 2007
Tax Notes May 2007
2007 PAYE Returns-Filing Extension
Due to problems with PAYE online, HMRC have just announced that the filing deadline for the 2007 end of year PAYE returns will be extended for this year only to 28 May. In addition no penalties will be charged if returns are received later due to "reasons outside your control". A term they will decide the meaning of in any appeal no doubt.
The filing extension takes pressure off customers and accountants who have been complaining that the service is so slow that the only way to file a return is out with normal office hours.
HMRC have also made an ‘apology’ to all affected…….
"We know that some agents experienced difficulty sending their clients’ Returns in early May. We are sorry for the inconvenience that caused. We can confirm that we will not charge a late filing penalty if we get a Return by midnight on 28 May. And if you still cannot send your Return by then, we will consider discharging any late filing penalty if you can show that you could not send a Return on time for reasons outside of your control.
We will still pay the £150 tax-free payment to employers with fewer than 50 employees as long as their Return is sent online, even if we get it after 28 May.”
Remember that there is still time to register for PAYE online if you want to claim the filing incentive.
My recommendation is to file within the deadline if you can. The alternative will be to end up with snow blindness as a result of endless future correspondence with HMRC regarding late filing penalty appeals.
2007 Personal Tax Returns
Just a reminder that you should now get your paperwork organised for your accountant for your Personal Tax.
Do not leave it to the last minute and try and avoid late filing penalties.
Remember most accountants are deadly slow, so it is not just the issue of getting your paperwork to them. It will take some months for them to look at what you hand to them.
Not speaking from personal experience of course......
Tax Notes May ... | Fri 11 am: add your comment [0]
Tuesday 13 Mar 2007
March Tax Update
Firms warned over wage deductions
Employers who supply accommodation to their employees should be wary when making wage deductions to cover utility costs following a landmark ruling handed down by the Court of Appeal.The decision means bosses at holiday camp companies Butlins and Haven will be forced to shell out almost £1m in refunds to workers.
During 2004 and 2005, Leisure Employment Services, which owns both firms, deducted £6 per fortnight from salaries of employees living on site to cover utility bill costs. However, the deductions meant that wages for many staff fell below the national minimum wage level.
Delvering the judgement, Lord Justice Buxton said: "The workers are seasonal staff employed as bar staff, shop assistants, receptionists, security staff and in some cases electricians and plumbers, in various parts of the country. If the sum of £3 per week were to be deducted from their wages, that would reduce remuneration below the national minimum wage level."
Denise Gaston, national minimum wage business manager at HM Revenue & Customs, said that the ruling was good news for all employees living in accommodation provided by their employer. "It reinforces the fact that deductions for things like heating and lighting must not take workers' pay below their legal entitlement," she said.
"Where we suspect employers are paying less than the minimum wage we investigate and where necessary pursue cases to tribunal."
HMRC originally brought the case against the holiday firms in 2005. After losing, the government department appealed and won. Leisure Employment Services took the case to the Court of Appeal last month.
The minimum wage is currently £5.35 per hour for adults and £4.45 for workers aged 18 to 21.
New CIS increases risk of identity fraud, warns KPMG
KPMG construction industry consultant John Weir this week warned that the new Construction Industry Scheme could increase the risk of identity fraud among unregistered subcontractors.
The new CIS does away with existing vouchers and certificates and instead requires contractors and "deemed contractors" (organisations that manage £1 million-plus building projects) to verify on a monthly basis that their subcontractors are registered under the scheme.
Subcontractors who have previously worked for reporting organisations will not have to be verified, but anyone taken on as a subcontractor after 6 April 2007 will need to be checked against HMRC's official register - either by phone or via HMRC's CIS website. Each contracting organisation will be required to certify that they have verified the status of their subcontractors on the returns they submit to HMRC every month.
One of the risks identified by KPMG in the new system is the possibility of identity fraud, Weir warned.
"Under the new scheme there is a possibility that someone could turn up and identify themselves as a subcontractor and you would need to verify their status. Unless you know them personally, your having to trust that they gave you the correct information," Weir said.
"There's always the possibility of someone selling their information to someone in the pub," he suggested. "If a subcontractor was skint, but had some unregistered mates, he could sell his ID, unique tax reference and national insurance number and they could impersonate him."
"The problem for the contractor is that if you accept the subcontractor is who they say they are, HMRC will tell you that, yes, Joe Bloggs is verified for gross pay status. People could turn up, get paid gross and disappear."
The rule is always check the identity of your sub-contractors and retain evidence of it if you need it as a defence in the future.
March Tax Upda ... | Tue 2 pm: add your comment [0]
Saturday 10 Feb 2007
Revenue tempts tax inspectors with bonuses
HMRC is offering tax inspectors financial incentives to encourage them to collect more money from individuals and businesses, 'The Times' has claimed. The newspaper said bosses at the Revenue have instructed compliance staff across the UK to increase the amount of recovered unpaid tax by 25% during 2007. The report added that bonuses of up to £2,000 are being offered to inspectors who meet their targets.
Experts warned that the new incentives and higher targets will lead to more tax investigations. An unnamed former tax inspector told 'The Times' that pressure to bring in more money would lead to inspectors seeking out more companies and individuals for investigation.
Most people would agree that It is perfectly right and proper for HMRC to recover monies that they are due. However, if this bonus system means a correlation between tax collected and bonuses paid, resulting in overzealous and unreasonable inquiries, then taxpayers should be extremely concerned.
We cannot have a system which encourages more frequent, lengthier and more tenacious inquiries simply based on whether someone gets a bonus or not.
Information released under the Freedom of Information Act shows that top performing HMRC staff are now entitled to a bonus of 3% of salary, while workers awarded a good performance mark can receive a 1.8% bonus.
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