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Tribunal finds that “total confusion” is not a Reasonable Excuse for late filing of tax returns.

A recent Tribunal case (Spacia Grocers vs HMRC) has found that the “total confusion” of the taxpayer is not a Reasonable Excuse for the late filing of tax returns. HMRC charges penalties for the late filing of tax returns – unless the late filing arises where there is a Reasonable Excuse.

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HMRC release statistics on distribution of Income Tax across industries

HMRC have released statistics showing the distribution of Income Tax deductions across sectors. The statistics cover the period from 2010/11 to 2016/17. The figures show that the main sectors contributing to income tax receipts are Financial and Insurance Activities (17.1%), Professional, Scientific and Technical Activities (12.2%) and Repair of Motor Vehicles and Motorcycles (10.4%).

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HMRC plans to increase interest rates on late tax payments following increase to Base Rate

Following yesterday’s increase in the Base Rate to 0.75% HMRC has announced plans to increase the interest rate charged on late tax payments. Interest rates for late payment are currently 3% and it is expected that these will increase to 3.25%.

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HMRC publish statistics on Inheritance Tax

HMRC have published detailed statistics regarding the Inheritance Tax System for recent years. These figures show that;

  • 4.2% of UK deaths were liable to IHT – continuing the longer term trend of more estates being brought into the IHT system
  •  IHT receipts totalled £5.2bn in 2017/18 – an increase of £388m from the previous year.
  • The capital value of estates has increased substantially since 2009/10 – with the majority of the increase due to increases in residential property prices

The statistics reflect the general trend that more estates have been pulled into the IHT system due to increases in property values and freezes in the level of the tax free Nil Rate Band.

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HMRC warns taxpayers of deadline to declare offshore assets

HMRC is advising tax payers to declare foreign income or profits on offshore assets before 30 September to avoid higher tax penalties.

If taxpayers have offshore income and gains then HMRC must be notified of an intention to disclose by the 30 September – they will then have 90 days to collate the full disclosure and pay any tax due. From 1 October 2018 HMRC will have access to more information on international assets held by UK tax payers under the information sharing mechanism known as the Common Reporting Standard (CRS).

To date 17,000 tax payers have notified HMRC of offshore assets.

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Making Tax Digital Updates from HMRC

HMRC issued VAT Notice700/22 on Friday giving more information on Making Tax Digital for VAT:

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Tax Credits renewal deadline – 31 July 2018

The deadline for renewing tax credits is 31 July 2018. All those claiming working tax credit (WTC) and/or child tax credit (CTC) should check what action they may need to take.

To follow the ICAEW guidance: CLICK HERE

 

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Hours on Payslips – Changes on the horizon for April 2019

From April 2019 employers will be required to include on payslips the number of hours worked by the employee for which they are being paid, but only in situations where the employee’s pay varies as a consequence of the time worked.

The Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018 was laid before parliament on 8 February 2018 and comes into force on 6 April 2019.

This instrument amends section 8 of the Employment Rights Act 1996 (c. 18), adding to the list of particulars which must be included in the itemised pay statement which an employee has a right to be given.

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HMRC announce outcome of consultation on Rent a Room Relief

HMRC have announced the outcome of a consultation on the future of Rent a Room Relief. The relief came under review due to changes to the nature of the private rented sector in recent years. The outcome of the consultation is that Rent a Room Relief will remain in close to its current form apart from some additional regulation. The additional regulation is intended to ensure that the relief remains targeted at those letting out a spare room in their own home.

Rent a Room Relief has been established since 1992 and currently allows individuals to earn up to £7,500 per year tax free from letting a spare room in their house.

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HMRC reduce SDLT payment deadline to 14 days

HMRC have confirmed that the SDLT return and payment deadline will be reduced to 14 days from 30 days. This will be effective from April 2019.

The main impact will be on conveyancers and solicitors who submit the SDLT returns and arrange payment on behalf of property purchasers.

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