Blog

Changes to tax treatment of termination payments

The government has published draft clauses for insertion into a new Finance Bill 2020-21, to be introduced into Parliament in the Autumn. These include changes which will affect employers who make termination payments. The part of a termination payment which is treated as being a payment in respect of the employee’s notice period and subject to income tax and NICs is called the “post-employment notice pay” (PENP). The provisions will provide an alternative PENP calculation where an employee’s pay period is defined in...

Read More

New redundancy protections for furloughed employees

The government has unveiled an important new law that will protect furloughed workers who are made redundant. This will ensure that any employee who was furloughed under the Coronavirus Job Retention Scheme (CJRS) will receive their full basic statutory redundancy entitlement. This amount will be based on their normal wages, rather than the reduced furlough rate. The legislation came into effect on 31 July 2020. Employees are normally entitled to statutory redundancy pay if they have been working for their current employer for 2 years or more....

Read More

£50 bike repair voucher scheme launched

The government has launched a new scheme - open to anyone in England - with a bike in need of repair. The Fix your Bike Voucher Scheme is a new initiative that has been championed by the Prime Minister, Boris Johnson, to help fix old bikes by offering a £50 bike repair voucher towards the total cost of repairs needed. The scheme hopes to provide an alternative to using public transport, reduce short car journeys and keep more people fitter whilst using a socially distanced form of transport. The scheme opened just before midnight on 28...

Read More

How elastic is demand for your products?

Many will remember the empty shelves in supermarkets when lock-down commenced March 2020. In particular, the absence of toilet rolls… Compare this with supplies of TVs and other luxury goods where there was no noticeable absence of supply. These examples point to a basic economic theory; that a product with few substitutes (toilet rolls) and where demand is constant, is inelastic. Products where there is no immediate, compelling need, chocolates or a new iPad, are said to be elastic from a demand perspective. Why does this...

Read More

Business rates review

The government has confirmed that the next business rates revaluation in England will be postponed until April 2023. The government has previously announced that the revaluation that was due in 2021 would be delayed due to the coronavirus pandemic but no date had been announced. The revaluation in April 2023 will be based on property values on 1 April 2021. The new revaluation date means that business rates will be based on property rental values that better reflect the impact of the pandemic. As with any revaluation there are winners and...

Read More

Beware £5,000 company fine

As well as filing accounts with Companies House, there is an important requirement to check that the information Companies House has about your company is correct every year. This is facilitated by the filing of an annual company confirmation statement. The confirmation statement was introduced in June 2016 and replaced the annual return. You could be subject to a fine of up to £5,000 for failing to send a confirmation statement. Companies House can also prosecute a company and its officers for failing to file a confirmation statement and...

Read More

Customs declarations for exporters of goods from 1 January 2021

The Brexit transition period is due to end 31 December 2020. The UK and EU have agreed there will not be any further extensions, although with the COVID-19 outbreak nothing appears certain. As things currently stand, no formal trade deal has been reached with the EU. Consequently, it seems likely that the process for exporting goods to the EU will change from 1 January 2021. Current guidance published by HMRC states that from 1 January 2021, businesses will need to make customs declarations when exporting goods to the EU. These rules currently...

Read More

Are you due a tax refund?

HMRC’s annual reconciliation of PAYE for the tax year 2019-20 is well under way. HMRC uses salary and pension information to calculate if you have paid the correct amount of tax. The calculation is usually generated automatically by HMRC’s computer systems on what is known as a P800 form. P800 forms are sent out from the end of the tax year with HMRC expecting all forms to be sent by the end of November. The P800 form is also used if you have not paid enough tax so be sure to read the document carefully. If you are due a refund,...

Read More

New measures to tackle promotion of tax avoidance

HMRC has published a series of a consultations together with details of proposed legislative changes to existing anti-avoidance regimes to strengthen HMRC’s ability to further clamp down on the market for tax avoidance. The proposals include: ensuring HMRC can effectively issue stop notices to promoters, under the Promoters of Tax Avoidance Scheme (POTAS) rules, to make it harder to promote schemes that do not work preventing promoters from abusing corporate entity structures to avoid their obligations under the POTAS rules ensuring...

Read More

HMRC to gain new civil information powers

A new measure that will provide HMRC with additional civil information powers is expected to take effect when the Finance Bill 2020-21 receives Royal Assent. The new measure known as a Financial Institution Notice (FIN) will be used to require financial institutions to provide information to HMRC, when requested, about a specific taxpayer and without the need for approval from the independent tribunal that considers tax matters. Currently it takes HMRC on average 12 months to respond to requests for third party financial information from other...

Read More