Accountancy Blog

New rules for termination payments

New rules are coming into force on 6 April 2018.

The tax treatment of termination payments can be complex, not least because a termination package typically comprises several different elements, which may be treated differently for tax and national insurance purposes.

In a bid to simplify matters, the rules for taxing payments made on the termination of someone’s employment are changing from 6 April 2018.

The rules introduce a new approach and reclassify some payments currently benefitting from the £30,000 exemption as earnings (with the result that benefit of the exemption is lost). More…

Devolution of tax powers – what you need to know

What tax powers are moving away from Westminster?

It may feel like we’re living in increasingly uncertain times ever since the UK voted to leave the EU.

That centred on most of the electorate’s desire to obtain more devolved powers from Brussels, but in reality devolution has been going on a lot closer to home for decades.

Back in September 1997, Scotland and Wales held referendums to transfer certain powers from central government to the regions, while Northern Ireland followed suit a year later.

While these devolution deals saw the creation of the Scottish parliament, the national assembly for Wales and the Northern Ireland assembly, many of the powers to raise certain taxes have either recently come into force or are due to take effect in 2018. More…

No more extra credit card fees on bills

Retailers and businesses are no longer able to charge consumers extra for using a credit card to pay for goods or services.

Interchange fees charged by firms on people who paid by credit card were banned on 13 January 2018 on the back of a widespread piece of EU legislation.

Some were previously surcharging consumers up to 3%, despite the cost to businesses that let people pay by credit card being capped at 0.3% by another EU ruling in December 2015.

Larger surcharges have been more common among businesses with takeaway apps and airlines, while local councils and government agencies have also been affected by the ban. More…

Fraudulent tax bills

Vulnerable and elderly people are being told they owe large amounts of tax which they can only pay off through digital vouchers and gift cards.

HMRC has issued a warning over fraudsters who are preying on victims by cold-calling them and impersonating members of staff from the Revenue.

Figures from Action Fraud, the national fraud reporting centre, show there have been more than 1,500 reports of this scam between January 2016 and August 2017.

The numbers have increased in recent months, with the vast majority of victims being over the age of 65 and suffering an average financial loss of £1,150. More…

Making tax digital – are you ready?

The overwhelming majority of business owners and landlords remain in the dark over making tax digital (MTD), government research shows.

Ipsos Mori polled 2,900 small businesses and landlords on behalf of HMRC and found that 71% were unaware of the requirement to submit quarterly updates to the taxman.

A further 13% had heard of the requirements but knew nothing about them.

Subject to any further change, MTD will mean most businesses and the self-employed access their tax affairs online through digital accounts from 2020.

As it stands, VAT-registered businesses will be the first to submit quarterly reports to HMRC – for VAT only – from April 2019. More…

Staircase tax – amendments to be made

The government has started the process to reverse the so-called ‘staircase tax’ to ease the pressure on small businesses.

Communities secretary Sajid Javid published draft legislation, which stands to benefit thousands of small business owners, to abolish the measure.

The loophole was first introduced after the Supreme Court ruled that an office spread over more than one floor in a mixed-use building would be taxed as two separate premises.

As a result, more than 1,000 businesses were braced to receive higher rate tax bills, with some paying more due to the loss of small business rate relief. More…