Archives for 2018

1 December 2018 – Due date for Corporation Tax due for the year ended 29 February 2018.
19 December 2018 – PAYE and NIC deductions due for month ended 5 December 2018. (If you pay your tax electronically the due date is 22 December 2018)
19 December 2018 – Filing deadline for the CIS300 monthly return for the month ended 5 December 2018.
19 December 2018 – CIS tax deducted for the month ended 5 December 2018 is payable by today.
30 December 2018 – Deadline for filing 2017-18 self-assessment tax returns online to include a claim for under payments to be collected via tax code in 2019-20.
1 January 2019 – Due date for Corporation Tax due for the year ended 31 March 2018.
19 January 2019 – PAYE and NIC deductions due for month ended 5 January 2019. (If you pay your tax electronically the due date is 22 January 2019)
19 January 2019 – Filing deadline for the CIS300 monthly return for the month ended 5 January 2019.
19 January 2019 – CIS tax deducted for the month ended 5 January 2019 is payable by today.
31 January 2019 – Last day to file 2017-18 self-assessment tax returns online.

When a director has been found guilty of mismanagement verging on fraud, one of the remedies that the courts can impose is disqualification as a director. But what does this actually mean?
A disqualified director has to abide to the following restrictions:
• While the order or undertaking is in force, it stops a person acting as if they were a director. Accordingly, you cannot avoid the order, or undertaking by simply changing the job description.
• The order or undertaking also means that you must not get other people to manage a company under your instructions. If you do, those people may also be prosecuted for assisting you in contravening the order or undertaking.
The order or undertaking does not stop you having a job with a company, but unless you have court permission it does stop you:
• acting as a director of a company;
• taking part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership;
• being a receiver of a company’s property.
You also cannot act as an insolvency practitioner.
In addition to companies, you must not do any of the prohibited acts in relation to the following organisations: Limited liability partnerships (LLPs), Building societies, Incorporated friendly societies, NHS foundation trusts, Open-ended investment companies, Registered societies and Charitable incorporated organisations.
A disqualification order will not stop you carrying on a business as a sole trader. You could also trade in a partnership, but not a Limited Liability Partnership (LLP).

Businesses that presently trade with the EU block may like to consider applying for Authorised Economic Operator (AEO) status. The following notes explain why this may be helpful.
AEO status is an internationally recognised quality mark that shows:
• your role in the international supply chain is secure;
• your customs controls and procedures are efficient and meet EU standards.
It’s not mandatory, but gives quicker access to some simplified customs procedures and, in some cases, the right to ‘fast-track’ your shipments through some customs and safety and security procedures.
AEO status is for businesses that:
• are a legal entity;
• are established in the territory of one of the 28 member states of the EU;
• are actively involved in customs operations and international trade;
• have an Economic Operator Registration and Identification (EORI) number.
Anyone involved in the international supply chain that carries out customs related activities in the EU can apply for AEO status, regardless of the size of their business. This includes:
• manufacturers
• exporters
• freight forwarders
• warehouse keepers
• customs agents
• carriers
• importers
• others (for example, port operators, secure freight parking operatives and airline loaders)
Types of AEO authorisation and their benefits
You can apply for AEO status customs simplification (AEOC), AEO status security and safety (AEOS), or both.
AEOC status
If you hold AEOC status, you could also benefit from:
• a faster application process for customs simplifications and authorisations;
• reductions or waivers of comprehensive guarantees;
• completing self-assessment (when implemented).
Whatever the outcome from the current Brexit impasse, AEO status does seem to offer advantages to importers and exporters.

Marriage Allowance lets you transfer £1,190 of your Personal Allowance to your husband, wife or civil partner – if they earn more than you.
This reduces their tax by up to £238 in the tax year. To benefit from this arrangement, you (as the lower earner) must have an income below your Personal Allowance – this is £11,850 for the current tax year.
You can backdate your claim to include any tax year since 5 April 2015.
If your partner has died since 5 April 2015 you can still claim – phone the Income Tax helpline. If your partner was the lower earner, the person responsible for managing their tax affairs needs to phone.
Who can apply?
You can benefit from Marriage Allowance if all the following apply:
• You’re married or in a civil partnership.
• You do not pay Income Tax, or your income is below your Personal Allowance (£11,850 for 2018-19).
• Your partner pays Income Tax at the basic rate, which usually means their income is between £11,851 and £46,350.
If you’re in Scotland, your partner must pay the starter, basic or intermediate rate, which usually means their income is between £11,850 and £43,430.
It will not affect your application for Marriage Allowance if you or your partner:
• are currently receiving a pension;
• live abroad – as long as you get a Personal Allowance.
If you or your partner were born before 6 April 1935, you might benefit more as a couple by applying for Married Couple’s Allowance instead.

This article is our usual reminder of the tax breaks available if you are organising a Christmas party for your staff.
Many businesses take time out to provide their employees with a work based party or similar event. If you are concerned about the tax consequences of Christmas celebrations, read on. We have included in this article ways to organise these events without falling foul of HMRC.
December gives us an excuse to let our hair down and enjoy a well-earned celebration with our work colleagues and partners. The cost of an annual staff party or similar function is allowed as a deduction for tax purposes. However, the cost is only deductible if it relates to employees and their guests, which would include directors in the case of a company, but not sole traders and business partners in the case of an unincorporated organisations. Also, it does not include ex-employees.
If the criteria below are followed there will be no taxable benefit charged to employees:
1. The event must be open to all employees at a specific location.
2. An annual Christmas party or other annual event offered to staff generally is not taxable on those attending provided that the average cost per head of the functions does not exceed £150 p.a. (inc VAT). The guests of staff attending are included in the head count when computing the cost per head attending.
3. All costs must be considered, including the costs of transport to and from the event, accommodation provided, and VAT. The total cost of the event is divided by the number attending to find the average cost. If the limit is exceeded then individual members of staff will be taxable on their average cost, plus the cost for any guests they were permitted to bring.
4. VAT input tax can be recovered on staff entertaining expenditure. If the guests of staff are also invited to the event the input tax should be apportioned, as the VAT applicable to non-staff is not recoverable. However, if non-staff attendees pay a reasonable contribution to the event, all the VAT can be reclaimed and of course output tax should be accounted for on the amount of the contribution.
Merry Christmas.

1 November 2018 – Due date for Corporation Tax due for the year ended 31 January 2018.
19 November 2018 – PAYE and NIC deductions due for month ended 5 November 2018. (If you pay your tax electronically the due date is 22 November 2018.)
19 November 2018 – Filing deadline for the CIS300 monthly return for the month ended 5 November 2018.
19 November 2018 – CIS tax deducted for the month ended 5 November 2018 is payable by today.
1 December 2018 – Due date for Corporation Tax due for the year ended 29 February 2018.
19 December 2018 – PAYE and NIC deductions due for month ended 5 December 2018. (If you pay your tax electronically the due date is 22 December 2018)
19 December 2018 – Filing deadline for the CIS300 monthly return for the month ended 5 December 2018.
19 December 2018 – CIS tax deducted for the month ended 5 December 2018 is payable by today.
30 December 2018 – Deadline for filing 2017-18 self assessment tax returns online to include a claim for under payments to be collected via tax code in 2019-20.

In his Autumn Budget delivered 29 October 2018, Philip Hammond made a number of promises including measures to improve the lack-lustre retail sector in our High Streets.
There is no doubt that the major online retailers have caused a major shift in the way we shop. As faster broadband has become more commonplace, and the use of computers a regular feature at home, the drift away from viewing and buying goods on the shelf to viewing pictures and click and buy on the internet, will likely continue.
At present, online retailers have a competitive advantage over their High Street competitors. They don’t have to pay:
• business rates or rent for shop front property or
• salaries to sales staff.
And in the case of the mega online retailers, who can afford to exploit the use of tax havens to shelter their trading profits, they do not pay comparable tax on their trading profits.
The recent Budget offered a one-third reduction in business rates for English retailers with smaller shop premises: those with a rateable value below £51,000. Although this reduction is for a limited period, two years from April 2019. Other regions to the UK may adopt a similar relief subject to decisions made by regional assemblies.
He has committed what seems to be a modest sum, £675m, to rejuvenating city centre areas. This will support the cost of:
• improving traffic flows to shopping areas,
• the renovation of empty retail premises to provide residential accommodation, and
• the repurposing of older or historical property.
City centre shops depend on foot-fall, if shoppers don’t pass by, then it’s unlikely they will become customers. In this respect, the above investment should encourage people to live and shop in city centre areas.
Mr Hammond also committed to start the process of increasing the UK tax take from online retailers, social media outlets and search engines, who sell goods and services to UK users. A new digital services tax will commence April 2020 and will levy a charge of 2% on the revenues generated by these concerns to customers in the UK

HMRC recently published a list of helpful reminders regarding the submission of monthly returns to HMRC. This article lists some of the points highlighted.
Each month contractors must send HMRC a complete return of all payments made to subcontractors within the scheme in the preceding tax month. This is regardless of whether the subcontractors were paid:
• net of the standard deduction of 20%
• net of the higher deduction of 30% or
• gross (you still need to include gross payment status subcontractors on your monthly submission if you pay them in the month even though no deductions have been made from their payments).
This monthly return must reach HMRC within 14 days of the end of the tax month it is for.
You can make your monthly returns using either:
• the free HMRC CIS online service or
• commercial CIS software
Contractors who know they won’t be paying any subcontractors for several months should let HMRC know. You can do this by selecting the ‘Inactivity Request’ box under the declarations section of the return. HMRC will make your CIS record ‘inactive’ for 6 months which means you will not need to send any monthly returns (including nil returns) during this period of inactivity. If, however the situation changes during that time and you start to pay subcontractors again, you must tell HMRC.
If you stop using subcontractors within the Construction Industry Scheme permanently or stop using subcontractors but continue to have employees liable to PAYE deductions, you need to tell HMRC and they will update your records to show you are no longer a contractor. Once all the required contractor monthly returns have been received up to the requested date of cessation then no further monthly returns (including nil returns) should be submitted. If, however you start making payments to subcontractors under the Construction Industry Scheme again you will need to advise HMRC.

HMRC is moving forwards with their digitisation of taxpayer VAT and Income Tax reporting requirements under their much publicised Making Tax Digital (MTD) initiative. We have reproduced below recent announcements made by HMRC on this issue.
Mandatory filing of VAT returns using MTD compliant software will commence for all returns with reporting periods commencing after 1 April 2019. This will apply to VAT registered traders with turnover in excess of the present VAT registration limit of £85,000.
Traders in the following list can apply for a six month deferral, to October 2019 from this requirement. Those eligible for the deferral are:
• trusts,
• ‘not for profit’ organisations that are not set up as a company,
• VAT divisions,
• VAT groups,
• those public sector entities required to provide additional information on their VAT return (Government departments, NHS Trusts),
• local authorities,
• public corporations,
• traders based overseas,
• those required to make payments on account and
• annual accounting scheme users.
Finally, a reminder that the MTD process will not be rolled-out to other taxes (Income Tax and Corporation Tax for example) until April 2020 at the earliest.

The childcare voucher and directly contracted childcare schemes closed 4 October 2018. In time, these schemes will be replaced by the roll-out of the new Tax-Free Childcare: this offers parents £2,000 per year per child towards approved childcare costs. (This is extended to £4,000 for disabled children.)
In a recent article HMRC confirmed the following instructions for employers:
• Employees who joined a scheme and had the necessary changes made to their salary on or before 4 October, will see no change. Both you and your employees will continue to benefit from any Income Tax exemption or National Insurance contributions (NICs) disregard.
• Applying to the scheme before the deadline is not sufficient and a new applicant needs to have had the necessary changes made to their salary by the deadline (4 October 2018) in order to benefit from the Income Tax exemption and NICs disregard.
• If you continue to offer a scheme for new entrants after 4 October, you’ll need to deduct Income Tax and NICs on any vouchers given and pay employer NICs after this date.
• Your employees need to tell you in writing (for example, by email) within 90 days if they start getting Tax-Free Childcare, so you can stop giving them vouchers and directly contracted childcare with Income Tax and NICs reliefs. If this means stopping or changing their salary sacrifice arrangement, you’ll need to update their contract and your payroll software. Employees won’t be able to return to your scheme once they’ve left.
Parents reading this post can check out what is available to their family under the new arrangements for child care support at https://www.childcarechoices.gov.uk/