HMRC recently said that they were going to use email to communicate about the change in VAT direct debit payments. HMRC have also sent an email to a number of established self-employed traders on 26 February 2021 asking them to prove they are still trading before they can claim the next two grants. This use of email by HMRC makes it more difficult to spot scam emails that look like something from HMRC.
The scammers are now targeting potential claimants for the SEISS 4th grant.
This is a new phishing scam that’s masquerading as an SEISS notification to trip-up desperate traders eagerly awaiting the latest grant.
Headed us as ‘HMRC SEISS Tax Refund Notification’, the email purports to alert you that claims for the SEISS grant have now opened for application and directs you to sign in to ‘HMRC online services’.
The scam email states “the date for submitting application for the Fourth SEISS grant start 22 April 2021”.
It instructs you to sign in and “follow step 1 of 3 to have your tax refund credit to your bank account”. The email recipient is then advised to have their passport and driving licence details in order to submit the application.
You are then encouraged to click the ‘HMRC online services self assessment’ hyperlink. It even has warning about fraudulent claims. You will then be asked to input band and other information that the scammers will be able to use, and this could cost you dearly.
The tell-tale sign that this is a scam is the reference to the grant as a tax refund. The grant is not a refund.
If you receive an email and you are not sure if it is genuine, send it to us and we will get back to you.
CGT late filing penalties totalling £1.3M
In the last six months of 2020, HMRC sent out 13,113 late filing penalties to landlords and second homeowners who missed the new 30-day tax window with 3,764 late filing penalties issued at the end of the third quarter (Q3) and 9,349 at the end of Q4.
These penalties have grossed HMRC over £1.3m in the last six months of 2020. The new law, introduced on 6 April 2020, means that anyone selling a second home must declare and pay any CGT due within a month of completion or face penalties.
The returns and payment are usually dealt with by your solicitor but not all lawyers do this so you need to check. Otherwise it will be you that pays the fine.
Those facing the fines can appeal against these penalties with HMRC considering whether they have a ‘reasonable excuse’ for not filing on time, on a case by case basis. HMRC will also consider Covid-19 as a reasonable excuse for missing some tax obligations such as payments or filing dates.
Incentive for hiring veterans.
This NIC relief is only available for 12 consecutive months from the veteran’s first day of civilian employment.
This relief is available from April 2021. From April 2021 to March 2022, employers will need to pay the associated secondary Class 1 National Insurance contributions as normal and then claim it back retrospectively from April 2022 onwards.
From April 2022 onwards, employers will be able to apply the relief in real time through PAYE.
A person qualifies as a veteran if they have served at least one day in the regular armed forces. This includes anyone who has completed at least one day of basic training.
The relief is available to all employers of veterans regardless of when the veteran left the regular armed forces, providing they have not previously been employed in a civilian capacity.
This zero-rate can be applied up to the upper secondary threshold
Relief is available for any civilian employment.
Self-employed individuals do not pay Class 1 National Insurance contributions. Therefore, self-employed businesses do not qualify for this relief. In addition, self-employed work does not trigger the qualifying period.
Relief will apply on earnings up to the upper secondary threshold. If a veteran’s earnings are above the threshold, employers can apply the relief on the part of the earnings below the threshold.
Employers can claim relief even if the employment starts before 6 April 2021, but will only be able to claim for the remaining qualifying period.
Do you have any Crypto Currency
A well know firm of accountants is claiming that HMRC is to begin collecting data on holdings of cryptocurrencies from taxpayers it suspects of tax evasion and avoidance.
HMRC’s ‘statement of assets’ form (used to demand a complete accounting of all a taxpayer’s assets in an investigation) will now include explicit demands for information on crypto currencies and other assets commonly used by organised crime.
This will include details on crypto assets such as Bitcoin and Ethereum, assets in E-money wallets like PayPal’ and assets in ‘value transfer’ systems such as Black Market Pesos, a system allegedly used by Mexican and Colombian drug cartels, Hundi, an Indian system of credit notes and Fei ch’ien, a trust-based money transfer system commonly used in China’s shadow financial system.
Those who are found to have concealed assets from HMRC can expect to be prosecuted. This new demand for data on these assets is an attempt by HMRC to get to grips with the problem.
Are your furloughed and home working employees reluctant to return?
You will need to determine why the employees are reluctant to return. Once this has been established, the right kind of conversation can then be had with each employee keeping their specific circumstances in mind.
As it stands, government guidance across the UK remains that staff should work from home where possible and where this is not possible, Covid-secure measures should be implemented in the workplace to reduce the spread of the virus.
You should therefore be careful not to force staff to return to the workplace, especially if they are in a position to work from home, as this could lead to a decline in staff retention and/or morale. Consult with individuals to address when the company proposes that they should return to the work place but giving plenty of notice. You should also discuss any issues the employee may have about retuning.
If, after all is said and done, the employee still refuses to return to the workplace on the proposed return date without prior agreement, you may be able to class this as a period of unauthorised absence. Unauthorised absences can result in disciplinary action being taken against employees who unreasonably refuse to return to work.
In a situation like this you may feel that you need professional support. Getting this sort of thing wrong can prove expensive and time consuming.
You could contact Tim Williamson at Peninsula.
Business Development Manager
Tel: 0844 8922773
Corporation Tax Changes – 2015 again!
Don’t rush into any incorporations without looking ahead to the forthcoming changes including the return to a 3 tiered tax rate system and increasing tax levels.
From April 2023 the corporation tax rate for the most profitable companies – those earning £250,000 or more – will rise from 19% to 25%. Small companies with profits of up to £50,000 will continue to be taxed at 19%, and there will be tapered rates between 19% to 25% for the businesses that fall between the thresholds. The effective rate for profits between £50,000 and 250,000 will be 26.25%
If you operate more than one company, these limits are spread evenly between all of the companies under your control, so if you have 5 companies, the £50,000 and £250,000 become £10,000 and £50,000 for each company.
This is a return to the system that was abolished in 2015, so it is back to the sort of tax planning that we used before the abolition, e.g., smoothing profits between associated companies, claiming allowances (and paying directors’ pension contributions) so as to stay out of the 26.25% band etc. It will also have an impact of the decision whether to pay salaries and get the higher tax relief, or pay dividends.
Prior to this abolition it was argued that this three-tiered approach created additional complexity to the system and disincentivised small company growth. I wonder what has changed.
There is an assumption in the creation of the tiered approach that only small companies have small profits which is plainly not the case.
If you have any questions about any of these, you know where to find us. If you prefer, just give me a ring on 07770 738770 or email me at email@example.com.