Need to know

Updated articles on corrections in payroll: The latest HMRC Agent Update highlights updated content regarding two aspects of corrections in payroll. We explain below the action that employers should take to ensure that employees have paid the right amounts.

HMRC contacts agents about potential 2021/22 SA discrepancies: Agents will be contacted where there is a discrepancy between the position set out in 2021/22 returns and the P11D and P14 forms submitted by their clients’ employer or child benefit information held by HMRC.

Agents should expect even longer waiting times on the ADL: HMRC is to formally remove the 10-minute average waiting time standard on the agent dedicated line (ADL). Calls to the ADL on individual PAYE matters may be routed to a separate team.

Long-term approach required for occupational health policy: When devising healthcare policy, the government needs to take a holistic approach. This includes considering the trade-off between the cost of tax reliefs now with the reduction in spending in the future on healthcare and health-related social security benefits.

HMRC to ask VAT-registered businesses to prove UK establishment: Businesses registered for VAT at a high-volume address will be asked by HMRC to prove they are established in the UK.

HMRC to remove paper form for VAT registration: The VAT1 form will only be available to customers through the VAT helpline from mid November 2023.

Full review of tax reliefs would impose uncertainty, says FST: The government has responded to the Treasury Committee’s call for a wholesale review of tax reliefs.

IFS examines options for reforming inheritance tax: In its recent report, the Institute for Fiscal Studies (IFS) considers several options for reforming inheritance tax (IHT). These include raising the IHT nil rate band (NRB), or capping key IHT reliefs such as business property relief (BPR) and agricultural property relief (APR).

Salary advances draft legislation may not work: Draft secondary legislation to simplify PAYE RTI reporting of salary advances needs amending if it is to work as intended where payments are made by third parties rather than by employers.

UK government responds to Treasury Committee venture capital reliefs report: The response suggests that the current sunset clauses for the enterprise investment scheme (EIS) and venture capital trusts (VCTs) will be extended beyond 2025. However, the response also pushes back on some of the committee’s other recommendations, including extending the company age and funding limits for these schemes.

Member help sheets and guidance

ICAEW and other professional bodies request action on tax simplification: Meaningful tax simplification requires a clear plan, focused resource, accountability, and investment, say the professional bodies.

HMRC updates guidance on charging company-provided electric cars: HMRC accepts that no taxable benefit arises where an employer reimburses their employee for the cost of charging a company-owned, wholly electric car that is available for private use.

Transitional arrangements ending for second-hand car sales in NI: From 1 November 2023, businesses will have to account for VAT on the full selling price of all vehicles bought in Great Britain and sold in Northern Ireland.

Public service pensions remedy guidance published: HMRC has released a suite of guidance for dealing with public service pensions that are affected by the McCloud remedy, including a tool for calculating the adjustment and making a claim.

Multilateral convention brings pillar one another step closer to implementation: If ratified by at least 30 jurisdictions, the convention will introduce a new mechanism for allocating taxing rights to market jurisdictions.

Consultations

HMRC consults on draft legislation regarding retained EU VAT law: The draft legislation and explanatory note clarify how VAT and excise law should be interpreted after changes made by the Retained EU Law (Revocation and Reform) Act 2023.

ICAEW concerned by burden of plastic packaging tax: In its response to HMRC’s consultation regarding plastic packaging tax, ICAEW noted that compliance costs often exceed the tax liability.

ICAEW welcomes proposed reforms to employee ownership trusts: A tax regime was introduced in 2014 to allow company owners to sell their companies to trusts that are run for the benefit of the employees. Overall, the regime has worked well but several changes were proposed by HMRC in a consultation document to ensure the regime better meets its objectives.

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