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Dates and Deadlines January 2014

Posted by: edwinsmith on December 31st, 2013

Upcoming deadlines for businesses and individuals

1 January: Corporation tax payment for a company not within the instalment regulations: year ending 31 March 2013.

5 January: End of month 9 for PAYE (RTI). All FPS (Full Payment Submissions) due if taking advantage of concession.

7 January: Online VAT return due to be filed and electronic payment of VAT due to be cleared into HMRC bank: quarter ended 30 November 2013.

10 January: Direct debit VAT payment will be taken: quarter ended 30 November 2013.

19 January: CIS monthly return deadline: month ended 5 January 2014.

19 January: Cheque payments for PAYE/NI, student loan, CIS  to be cleared into HMRC bank: month ended 5 January 2014.

22 January: Electronic PAYE/NI etc payments to be cleared into HMRC bank: month ended 5 January 2014.

31 January : Submission of electronic 2012/13 self assessment tax return and payment of outstanding tax (balancing payment 2012/13 and 1st payment on account 2013/14)

31 January : Company tax return CT600 due to HMRC: years ending 31 January 2013.

31 January: Company accounts (Private Limited Co) due to be filed: years ending 30 April 2013.

31 January: Company accounts (Public Companies) due to be filed: years ending 31 July 2013.

1 February : Corporation tax payment for company not within the instalment regulations: years ending 30 April 2013.


RTI filing concession extension

Posted by: edwinsmith on December 27th, 2013

Micro employers will be able to take advantage of the current RTI filing concession until April 2016. Micro employers are defined as having nine or fewer employees.

HMRC reports that the majority of employers are reporting on time but does recognise that the smaller businesses do need more time to adapt.

All employers starting to operate PAYE after 6 April 2014 as well as existing employers with 10 or more employees will need to report each time they pay their employees from April 2014.

If you wish to take advantage of the concession, you may need to check with your software provider that the package you are using will be adapted to advise HMRC that you are taking advantage of the concession to avoid penalties from April 2014.

If you require any help with PAYE then contact us.

Filed under: Company, Employers, PAYE

VAT Bad debt relief

Posted by: edwinsmith on December 23rd, 2013

If you are VAT registered, made supplies to a customer and have not been paid then you should consider making a claim to recover the VAT that has been paid to HMRC on the respective supply.

There are various conditions and rules that need to be followed in order to claim the VAT bad debt relief and although these rules have been around for some time it is useful to remind ourselves of the various steps that need to be followed to make a valid claim.

Current time limit to make a claim for bad debt relief
The general time limit for making a claim for supplies made after 30 April 1997 is 4 years and 6 months from the later of the due date of payment for the supply or the actual date of supply (there are other rules that may apply for supplies made between 1 April 1989 and 30 April 1997). The due date of payment may be determined by your normal credit terms or an arrangement made with customer if longer.

Conditions to make a claim for bad debt relief
In order to claim relief from VAT on bad debts there are 7 conditions that need to be met. The first five detailed below apply to supplies made after 30 April 1997.

1. You must have already have accounted for the VAT on the supplies and paid it to HMRC.
2. You must have written off the debt in your day to day VAT accounts and transferred it to a separate bad debt account.
3. The value of the supply must not be more than the customary selling price.
4. The debt must not have been paid, sold or factored under a valid legal agreement (see 3.12 of HMRC VAT notice 700/18).
5. The debt must have remained unpaid for a period of six months after the later of the time payment was due and the date of supply

Conditions 6 and 7 wholly apply to supplies made before 30 April 1997 –see HMRC VAT notice 700/18.

If you account for VAT under the cash accounting scheme or one of the special VAT retail schemes then the above the bad debt relief will not apply as no VAT would have been paid to HMRC relating to the supply.

How to make claim for bad debt relief
The amount of VAT being claimed should be included in Box 4 of your VAT return which covers the date when the conditions are met to make a claim.

Records required in respect of claim for bad debt relief
You must keep records in respect of the claim which include a copy of the VAT invoice in respect of the supply for which you are making a claim – full details on these records are shown in 2.5 of HMRC VAT notice 700/18. These records must be kept 4 years from the date you make the claim.

Since 30 April 1997 you do not need to notify the customer that you are making a claim for VAT bad debt relief.

Bad debt relief claims in respect of part paid supplies
If you are making a claim for bad debt relief in respect of supplies for which you have received part payment then you can only claim a refund on the VAT relating to the amount that is still unpaid. The payment should also be allocated to the earliest supply (unless customer specifies payments relates to a particular supply which paid for in full). An example of the operation of the rules for allocating payments of part paid debts is shown in 3.3 and 3.4 of HMRC VAT notice 700/18.

Other circumstances
Where you have provided finance in respect of a supply or provided security in respect of a debt or there are other unusual circumstances relating then you consider sections 3.5 to 3.13 of HMRC VAT notice 700/18.

Payment received on supply after making claim for bad debt relief
If you have received a refund in respect of a claim for VAT bad debt relief and you later receive a payment for the supplies then you must repay the VAT element included in the payment. The payments received for the supply/supplies must be shown in a separate bad debt account. The VAT being repaid should be shown in Box 1 of your VAT return. If you are no longer VAT registered then you must still repay the appropriate VAT and contact HMRC for guidance.

If you require further advice or assistance with VAT bad debt relief claim then please contact us.

Filed under: Business, Company, VAT

Latest phishing email warning from HMRC

Posted by: edwinsmith on December 18th, 2013

A number of us here received an email which appeared to be from HMRC announcing a new Employers Bulletin. We are all aware of the usual phishing emails but this one was different. It was not an unexpected announcement and could very easily have fooled some. The zip file attached raised our suspicions and so before anyone opened it, we very quickly let our staff know of the danger and forwarded the email to HMRC for review.

A day later, HMRC announced and confirmed this email as a phishing scam.

The wording is as follows:

From: HMRC Employer Alerts [mailto:employers@alerts.hmrc.gov.uk]
Sent: 17 December 2013 14:13
To: Caroline Meredith
Subject: HMRC: Important Information for Employers

Employer Bulletin Issue 45 out now

The latest version of the Employer Bulletin issue 45 has just been published.
This edition contains the latest information about filing your PAYE information in real time.

To find out more open the attached document(s)

Your next employer email alert is scheduled for February 2014
*** Please do not respond to this email
If you have any concerns regarding the validity of this or any emails received from HMRC go to our Online Security pages for more information by using the web address below [excluded].

The zip files attached should always be enough to raise suspicion as in this case. Don't get caught out.

The genuine Employer Bulletin was issued in September and does not contain a zip file. HMRC will update the HMRC Genuine Contacts page when the next genuine Employer Bulletin is due to be published in February 2014.

Always either check with us or the HMRC website if you are unsure.

2013 Autumn Statement

Posted by: edwinsmith on December 9th, 2013

The Chancellor delivered the Autumn Statement on 5 December 2013 and the following are a selection of the main announcements made that affect tax rates and allowances etc. The majority of these announcements will be enacted through legislation.

Corporation Tax

  1. Simpler rules for associated companies from April 2015 when the main rate and small profits rate of corporation tax are unified at 20%.
  2. Easing rules on the restrictions of the availability of trading losses on the change of ownership of a company.
  3. From April 2014 donations of money by companies to Community Amateur Sports Clubs will be eligible for corporate gift aid.

Business Tax (Companies and self employed)

  1. Various measures to business rates including capping the RPI increase at 2% for the year from 1 April 2014 and extending the Small Business Rate Relief doubling for the year from 1 April 2014.
  2. Company car tax – to protect revenues from 6 April 2014 legislation is to be introduced to:

Ensure individuals make payment for private use of a company car in the relevant tax year; and
Ensure that where an employer leases a car to an employee the benefit is taxed as a car benefit rather than as employment earnings.

  1. From April 2015 employer national insurance for employees under 21 to be abolished for those earning under the upper earnings limit, (£42,285 per annum, £813 per week for 2015/16).
  2. Existing legislation to be amended from April 2014 to prevent intermediaries being used to avoid employment taxes by disguising employment as self employment.

Income Tax

  1. Transferable tax allowances for married couples and civil partners from 2015/16 will be introduced for couples where neither partner is a higher rate or additional rate tax payer. An individual will be able to transfer £1,000 of their income tax personal allowance to their spouse or civil partner. The transferable amount will be increased in line with the personal allowance in future years.
  2. New ISA annual subscription limits for 2014/15 of £11,880 (half of which can be saved in a cash ISA). The limits for the Junior ISA and the Child Trust Fund will also increase to £3,840.
  3. Pension saving - as a result of the lifetime allowance reducing to £1.25 million from £1.5 million on 6 April 2014, the government will introduce individual protection 2014 (IP14) so that individuals with IP14 will have a lifetime allowance of the value of their pension saving on 5 April 2014 subject to an overall maximum of £1.5million.
  4. From April 2014 income tax relief on interest paid on loans to close companies and employee controlled companies will be extended to investments in such companies resident throughout the European Economic Area.

Capital Gains Tax

  1. Private residence relief – a reduction in the final period exemption from 36 months to 18 months to apply from April 2014.
    Note - If you are selling or contemplating the sale of a residential property which has been your principal private residence for part of your period of ownership but not recently, then you may wish to ensure the sale of the property occurs before 6 April 2014 to ensure you take advantage of the 36 month final period exemption.
  2. From April 2015 capital gains tax will apply to future gains on the disposal of residential properties by non-residents.

Other measures announced include the following.

  1. Cancel the fuel duty increase planned for 1 September 2014 expected to be worth 1.61p per litre.
  2. The basic State pension will increase by 2.7% which is a cash rise of £2.95 per week for the full basic State pension.
  3. The remaining benefits and tax credits which are not being up rated by 1% as per Autumn Statement 2012  (working age tax benefits) will increase by 2.7%  in April 2014 including disability, carers benefits etc.
  4. From October 2015 a new class 3A voluntary national insurance contribution to pensioners retiring before 6 April 2016 to enable them to top up their Additional Pension records.
  5. Vehicle Excise Duty – from 1 October 2014 motorists will be able to pay by direct debit, annually, biannually or monthly although a 5% surcharge will apply to biannual and monthly payments. A paper disc will no longer be issued to be displayed on a vehicle.
  6. A limit to the average increase in regulated rail fares to RPI for a year from January 2014.
  7. New Single Fraud Investigation Service and data-matching exercise to investigate welfare fraud.

For full details see 2013 Autumn Statement

Please contact us  if you require further information and assistance.

Filed under: Autumn statement