HMRC

Can’t pay your tax?

A reminder that HMRC may consider extended options for settling your outstanding tax bill. The key is to contact HMRC, explain why you can’t pay on time, and discuss how you can settle any outstanding liabilities.

Making Tax Digital - Bridging software

Can we still use spreadsheets after MTD comes into force?
One of the most commonly asked questions concerning the Making Tax Digital changes coming in from April 2019 concerns whether spreadsheets count as “functional compatible software”.  The answer to this is both yes and no.

How to spot a HMRC scam

Fraudsters will disguise themselves as HMRC and other government departments/professional bodies to:
•    Obtain personal details which they will sell or use for identity theft,
•    Coax victims into handing over money,
•    Use victims’ details to steal money from their accounts. 
 

Making Tax Digital - Bridging software

One of the most commonly asked questions concerning the Making Tax Digital changes coming in from April 2019 concerns whether spreadsheets count as “functional compatible software”.   Bridging software allows businesses to transfer the relevant VAT information from a spreadsheet directly into HMRC's MTD systems - thereby removing the need to purchase a full accounting software package - at least in the short-term. 

Making Tax Digital timeline

You will be aware that HMRC is moving forward with their digitisation of taxpayer VAT and Income Tax reporting requirements, under their much publicised Making Tax Digital (MTD) initiative. Below you will find the most recent announcements made by HMRC on this issue.
 

What is a reasonable excuse?

HMRC is still required to obtain certain returns from you even if there is no income or tax to declare. Failure to submit will likely trigger late filing penalties and unfortunately, pleading ignorance of your obligations to file “nil” returns is not a reasonable excuse.

Points based penalties

In the recently published draft clauses that will form the basis of the Budget later this year, HMRC has outlined a significant change to the way they will be levying penalties for late filing breaches under the Making Tax Digital regulations.
 

Tax-free childcare support expanded

Since 14 February 2018, tax-free childcare has become available to all remaining eligible families: parents whose youngest child is under 12. The new scheme aims to help working parents with the cost of childcare. 

According to government, it is quick and easy to apply, and parents could save thousands of pounds each year. For every £8 parents pay into their childcare account, the government will add an extra £2, up to £2,000 per child per year. HMRC has been gradually rolling out tax-free childcare since April 2017. 

Claiming back professional subscriptions

If your employment requires that you obtain and maintain membership of a professional organisation, you can make a claim to set the cost against your taxable earnings for income tax purposes. As you would expect there are a few hoops you will need to jump through to claim this relief. They are:
 

Beneficial loans to employees

In many cases, making loans to your employees or their relatives can create an obligation to report a beneficial loan to HMRC. The deemed benefit would be a taxable benefit in kind for the relevant employee, and would increase the employer’s Class 1A NIC bill at the end of the tax year.

VAT blow for cultural charities and public bodies

The European Court of Justice (ECJ) has finally crushed hopes that more public bodies and charities engaged in cultural activities could claim VAT exemption on their admission charges. Its recent judgment in the VAT case of the British Film Institute (BFI), released in February, draws a line under an argument that has been running for the last four years.

Making tax digital

The current tax year, 2017-18, is the last year we have to prepare for the advent of the new reporting system, Making Tax Digital for Business (MTDfB). Following the recent budget, it is now clear which businesses are going to be affected and when. Dates for implementation will be: