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VAT – direct debit facility – leave five working days

Posted by: edwinsmith on June 7th, 2010

Many businesses are now obliged to file their vat online as reported in our post VAT returns online and electronic payment. This obligation also means that the payment must be made electronically.

There are various methods of electronic payment and in most cases they give you up to seven extra calendar days in which to pay - or at least ten calendar days if paying by Direct Debit online.

When using the direct debit facility, it is important to leave at least five bank working days between setting up the direct debit facility online and filing your next return online.  If this minimum period is not left, then it is likely that the amount due will not be collected and you will have to make arrangements to pay your VAT by an alternative electronic method.

When you set up the direct debit, the system will tell you the earliest date from which HMRC will collect payment from the account. You should not submit a return until after this date if you wish for the VAT to be collected by direct debit. If you have not left enough time to wait until after this date then you will need to just submit the return and make a payment by an alternative electronic method.

Once the system is set up it will be ready to collect the VAT due for all future returns.

When you have submitted a VAT return, the acknowledgement for the submission will state how the VAT will be paid, whether directly from your bank on the date stated or whether you will need to pay it by an alternative electronic method.

Don’t forget that if the VAT payable to HMRC on your return is less than £1, then you don't need to pay anything to HMRC or carry the amount forward!

For more information about setting up and paying by direct debit, please visit the HMRC website or contact us for advice.

Filed under: VAT

Revised advisory fuel rates from 1 June 2010

Posted by: edwinsmith on June 1st, 2010

H.M. Revenue and Customs (HMRC) have published the latest advisory fuel rates relating to mileage payments for business travel in company cars. These are as follows: 

Engine size Petrol Diesel LPG
1400cc or less 12p 11p 8p
1401cc to 2000cc 15p 11p 10p
Over 2000cc 21p 16p 14p

The new rates will be effective from 1 June 2010, however for the first month employers may continue to use the previously published rates if they choose to.

These rates will be reviewed again later in the year and any changes made will be effective from 1 December 2010.  The revised fuel rates will be published on this page when they are released.

Advisory fuel rates can be used to calculate the following:

  • Reimbursement to employees of fuel used for business travel in a company car
  • Repayment by employees of fuel used for personal travel in a company car
  • Allowable input VAT on business mileage claims

A more detailed explanation of the use of these rates is on the HMRC website.

The rates applying for earlier periods are also on the HMRC website.

If you have any questions regarding the use of advisory fuel rates or mileage payments please contact us.

Filed under: PAYE, Tax, VAT

Avoid a late filing penalty for your 2009-10 Employer Annual Return

Posted by: edwinsmith on May 24th, 2010

The deadline for filing your 2009-10 Employer Annual Return (P35 and P14’s) online has now passed. If you still haven’t filed your return, you must do so as soon as possible to avoid being charged a late-filing penalty.

If you haven’t filed online and received confirmation that your return has been accepted by 11:59pm on Wednesday 26 May you will be charged a late filing penalty.

For those employers who are exempt from filing online and have chosen to file on paper, the Employer Annual Return must be with HMRC when post is opened on Thursday 27 May.

There are only a few days left to stay penalty free so post or file your return now.

Employers who don’t need to make year-end returns (form P35) must advise HMRC using the email notification facility.

If you need assistance with filing online or would like advice on completing your Employer Annual Return then please contact us.

Filed under: PAYE

Tax Health Plan Disclosure & Payment Required By 30 June 2010

Posted by: edwinsmith on May 21st, 2010

Further to our news article, Tax Health Plan (THP) - Tax Amnesty for Doctors and Dentists, the deadline of 30 June 2010 is approaching for disclosing and paying any tax, interest and penalties due.

Previously, notification of the intention to disclose should have been made by 31 March 2010.

Accountants are able to disclose on behalf of their clients.

HMRC will not calculate your tax, interest or penalties so you or your accountant will need to calculate this. The penalty, to include with your disclosure, is 10% of the underpaid taxes/duties and Class 4 National Insurance unless the unpaid liability is less than £1,000 where there will be no penalty. Interest will be calculated from the date the tax was due to the date of payment using HMRC’s interest rates.

HMRC have confirmed that if a disclosure made within the terms of the disclosure opportunity is incomplete, or there is a failure to disclose amounts liable to tax or duty, they will consider the instigation of a criminal investigation, in line with their criminal investigation policy.  They also stated that they will “pursue those with undeclared tax liabilities who decide not to make a disclosure. In these cases the penalties could be up to 100% of the tax due and in exceptional circumstances criminal investigation may be considered”.

More information regarding the THP disclosure is available on the HMRC website. Alternatively, please contact us and we can assist you.

Filed under: HMRC campaigns, Tax

Emergency Budget 2010 – 22 June

Posted by: edwinsmith on May 17th, 2010

Chancellor George Osborne has confirmed that an emergency Budget will be held on Tuesday 22 June 2010.

Filed under: Budget Report

Online HMRC Dispensation Application

Posted by: edwinsmith on May 13th, 2010

HM Revenue & Customs (HMRC) now provide the facility to file a dispensation application online in addition to sending the application by post.

If HMRC grant your business a dispensation, it removes the requirement to report those expenses and benefits to them at the end of the year on forms P11D or P9D. There is also no tax or National Insurance to pay on items covered by a dispensation. Granted dispensations last indefinitely but HMRC reviews them regularly (usually at intervals of five years or less) to make sure that the conditions under which they were issued still apply.

You can apply to HMRC for a dispensation to cover expenses or benefits for which your employee will get a full tax deduction. This includes many routine business expenses and benefits. To find out whether an individual item can or can’t be included in a dispensation, see the expenses and benefits A to Z.  If there is no reference to dispensations in the item’s A to Z entry, it means the item can’t be included in a dispensation.

The main expenses routinely covered by a dispensation are:

•           travel, including subsistence costs associated with business travel

•           fuel for company cars

•           hire car costs

•           telephones

•           business entertainment expenses

•           credit cards used for business

•           fees and subscriptions

You must have an independent system in place for checking and authorising expenses claims. At a minimum, this means having someone, other than the employee claiming the expenses, to check that:

•           the amount claimed isn’t excessive

•           the claim doesn’t include disallowable items

If it is not possible for you to operate an independent system for checking and authorising expenses claims - for example, because you are the sole director of your company and you have no other employees - you will only be able to obtain a dispensation if you:

•           ensure all expenses claims are supported by receipts for the expenditure

•           demonstrate that the claim relates to expenditure that can be covered by a dispensation – your receipts may be sufficient for this purpose, but if not you must retain additional information. Alternatively, we can authorise the expenses claims for you.

Please contact us or review the HMRC dispensation guidance to find out more.

Filed under: PAYE

Reminder regarding penalties for late PAYE payment

Posted by: edwinsmith on May 7th, 2010

As stated in a previous article, penalties for late PAYE payments have now been introduced.

It is important that payments are made to HMRC on time or if no payment is due that a nil payslip is submitted to HMRC by the due date by either post or online.

A summary of the original post is below.

From 5 May 2010, the end of the first month in the 2010/2011 tax year, all employers and contractors will be subject to a penalty regime for late payments. Penalties will be charged for late monthly, quarterly or annual payments of:

  • tax
  • National Insurance Contributions
  • Construction Industry Scheme deductions
  • Student Loan deductions.

In year payments and the Class 1A National Insurance payment relating to P11D benefits (for 2010/11) will need to be made on time and in full. HM Revenue & Customs (HMRC) have confirmed though that one late payment in the tax year will not result in a penalty as long as it is not more than six months late.

PAYE penalties will be worked out on a proportion basis of the amount that is late.  The later the payment the bigger the percentage will be.

Making a PAYE payment to HMRC can be made in various ways and the due date for payment can vary depending on your payment method as making a payment electronically provides additional time.

If no amounts are due for a particular month or quarter a nil payslip should be sent by the payment due date, either by post or by sending a notification of a nil payslip online, to avoid any unnecessary penalties. To do this online you will need your accounts office reference number. To send by post you will need the yellow Employers Payslip Booklet.

If you have any questions or would like to find out more please either contact us or review the PAYE penalties information on the HMRC website.

Filed under: PAYE

Further Employers CD Rom update

Posted by: edwinsmith on April 30th, 2010

HM Revenue and Customs (HMRC) produced an update in March (V2.0.2) which solved the majority of problems customers had been experiencing with the Employers CD Rom and have now produced a further update in April (V2.0.3) which also solves one further issue that has been identified.

If you haven’t yet installed the March update, then you can simply install the April one to solve all known issues. It is recommended that you do this regardless of whether you have experienced any problems or if the problems you've experienced differ from those below.

The update to the 2010 Employers CD-ROM is available on the HRMC website and should be installed by all users of this product who:

-    Haven’t installed the March update that was previously available to download from our website; or

-    Have installed the March update, but are seeing on-screen messages advising that the 2010 CD-ROM may be out of date. This is not the case and you should not contact the Employer Orderline as the message recommends. You can simply ignore these messages or install this latest update to remove them.

Known issues which the April 2010 update will fix

Once you've installed the April update, the following known issues should be resolved:

-    the total amount of tax and National Insurance contributions due sometimes being carried forward incorrectly to the 2009-10 end-of-year summary (P35);

-    problems transferring data from the 2009 CD-ROM;

-    problems opening PDF forms (Windows users only); and

-    on-screen messages incorrectly advising that the CD-ROM is out of date.

How to get the update

The Employer CD Rom update can be downloaded from the HMRC website and should be installed even if you haven’t encountered the above problems.

You will need to exit or close your current CD-ROM before installing the update.

If you've entered any data for the start of the new tax year, 2010-11, this will be deleted. You will need to re-enter it after applying the update and so this update should be installed as soon as possible.

Getting an update if you don't have internet access

If the computer on which with your CD-ROM is installed doesn't have internet access then you can do either of the following:

-    download the April update on a different machine and copy it to the relevant computer (fastest solution)

-    call the Employer Orderline who will post you the update on disc.

If you've already sent in your 2009-10 Employer Annual Return

You should still download and install the April 2010 update. What you do next will depend on whether your Employer Annual Return was accepted or rejected.

If your return was originally rejected then you can use the CD-ROM again to file your return. You need to do this before 19 May 2010. If your return was accepted please contact the Online Services Helpdesk on 0845 60 55 999 who can then tell you the action you may need to take.

Further help and guidance is provided on the HMRC website or alternatively please contact us.

Filed under: PAYE

HMRC Fact Sheets For New Compliance Checks

Posted by: edwinsmith on April 26th, 2010

From 1 April 2010, HMRC will have one set of powers regarding compliance checks, covering:

  • visits to business premises to inspect the premises, assets and records
  • asking tax payers and third parties for information and documents.

The new measures also provide new time limits for assessment and claims and new rights for taxpayers.

HMRC have published a series of fact sheets to explain the new framework.

Filed under: PAYE, Tax, VAT

Blank page displayed when trying to view HMRC online statements

Posted by: edwinsmith on April 23rd, 2010

When trying to view pdf information on the HMRC website you may be presented with a blank page instead of the required information. This occurs when trying to view submitted VAT returns, P60 forms etc.

HMRC are aware of this and have provided 4 possible solutions on their website however for ease of use, the solutions are detailed below.

Solution 1 – Do not save encrypted pages to disk

In Internet Explorer for Windows:

• go to Tools - Internet Options

• Advanced tab

• under Security, ensure the ‘Do not save encrypted pages to disk’ is checked

• click Ok

Solution 2 - Disable 'view in browser' feature

Try disabling the 'View In Browser' or 'Web Browser Integration' feature in your Adobe Acrobat viewer (for plug-in and standard version). Doing this will force your Acrobat viewer to display PDF outside your browser in a separate window.

• open Acrobat/Adobe Reader

• go to Edit - Preferences

• go to Internet

• uncheck ‘Display PDF in browser’

• click

• close Acrobat

Solution 3 - Download PDF to hard drive

In Microsoft Internet Explorer 4.0 or later:

• Right-click (Windows) or hold down the mouse button (Mac OS) on the link to the PDF file, and then choose Save Target As from the pop-up menu.

• In the Save As dialog box, specify a name and location for the PDF file, and then click Save.

• Choose All Files from the Files of Type pop-up menu.

• Select the PDF file you saved in step 2 and click Open. The Acrobat viewer should open the PDF file inside the browser window.

• If the PDF doesn’t load inside the browser then locate the saved file on the PC and double-click to open in Adobe.

Note: If the viewer displays only a blank screen or returns an error after you've downloaded a PDF file to your hard disk, the viewer or the PDF file may be damaged. Exit the browser, restart the viewer, and try to open an Acrobat Online Guide from the viewer's Help menu. If the viewer can't display an online guide, the viewer itself may be damaged and you should contact Acrobat Technical Support. If the viewer correctly displays the online guide, try opening the PDF file you downloaded. If the viewer can display the downloaded PDF file, the PDF file isn't damaged; rather, your browser isn't working with the Acrobat plug-in. If the viewer still displays only a blank screen or returns an error, the PDF file is probably damaged.

Solution 4 - Check Security Options

In Internet Explorer for Windows:

• exit from Internet Explorer and your Acrobat viewer

• start Internet Explorer

• choose Tools > Internet Options and click the Security tab

• choose the appropriate Web content zone for the type of PDF file you're trying to open (for example: Internet or Local Intranet)

• click Custom Level to specify the security setting for this zone

• select Enable for the options labelled 'Download unsigned ActiveX controls' and 'Initialize and script ActiveX Controls not marked as safe'

• click OK and then click OK again

In Internet Explorer for Mac OS:

• Choose Edit - Preferences.

• Click Ratings and then click Options.

• Select the option labelled 'User Can See Sites That Have No Rating,' and click OK. Contact Microsoft for more information on which security settings affect Internet Explorer's ability to download files.

Should you be unable to resolve this issue, you may want to consider downloading Firefox or Opera as an alternative web browser.

Filed under: PAYE, Tax, VAT
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