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PAYE, CIS and Student Loan Deductions Due For 5th March

This is relevant for any employers who have made PAYE deductions from the salaries of their employees. It also applies to contractors paying subcontractors under the CIS.

Payments are due from employers to HMRC for income tax,national insurance and student loan deductions, while contractors are to submit payments to HMRC of tax deductions from subcontractors under the CIS.

The deadline for electronic payments will be 22nd March, 2019

Interest will be charged for late payments and penalties may also apply.

Get Ready For the End of the Tax Year 2018/2019

The deadline of 5th April 2019 is important for anyone who hasn’t been thinking about end of the tax year planning issues, including:

● Making use of the annual capital gains tax exemption.
● Making use of the annua inheritance tax exemption for gifts.
● Making use of the Individual Savings Account (ISA) investment limit.
● Making additional contributions to a pension fund.

Vigilance Recommended for Households With Landlines

With the crackdown continuing on email and SMS phishing, criminals are increasingly turning to cold-calls to publicly available landline numbers to steal from unsuspecting taxpayers. Ofcom has reported that almost 26 million UK homes have a landline which could be vulnerable to scam calls.

Such criminals often concentrate their efforts upon the elderly and vulnerable. Often they purport to be calling from HMRC with the latter having received over 60,000 reports of scam calls in only the last 6 months leading to January 2019. Just to put that into context, this represents a surge of 360% in comparison to the preceding 6 months.

Mel Stride MP, Financial Secretary to the Treasury, has said:

“We have taken major steps to crack down on text and email phishing scams leaving fraudsters no choice but to try and con taxpayers over the phone.

“If you receive a suspicious call to your landline from someone purporting to be from HMRC which threatens legal action, to put you in jail, or payment using vouchers: hang up and report it to HMRC who can work to take them off the network.”

Pauline Smith, from Action Fraud, has said:

“Fraudsters will call your landline claiming to be from reputable organisations such as HMRC. Contact like this is designed to convince you to hand over valuable personal details or your money.

“Don't assume anyone who calls you is who they say they are. If a person calls and asks you to make a payment, log in to an online account or offers you a deal, be cautious and seek advice.

“The tax authority will only ever call you asking for payment on a debt that you are already aware of, either having received a letter about it, or after you've told us you owe some tax, for example through a Self Assessment return.”

The past year has seen Ofcom and phone networks close almost 450 lines used by criminals in this way.

An Update For Employers

The latest Employer Bulletin update from HMRC, issued in February, included articles that raised important points. Amongst these were:

● Student Loan notices, and a new type of Student Loan repayment needed by employers to process via payroll
● Reporting expenses and benefits
● Updates to the Starter checklist for new employees
● Updates to P9 Notices of Coding
● Scottish Income Tax
● Welsh Rate of Income Tax and new codes for Welsh taxpayers.

Making the Most of the Tax Year for Investments

The end of the tax year is almost upon us, but there is still time to make a savvy investment to take advantage of 2018/2019 tax breaks.

Don’t forget to use as much of your ISA allowance as you can. Your ISA is a great way to save without paying any tax. Use the £20,000 annual limit for savings, a nest egg, a first home, etc. You have until 5 April to make a 2018/2019 investment.

The annual allowance (AA) for pensions generally offers £40,000 as a maximum for pension contributions for which you can still benefit from tax relief. Don’t forget that you may have a few years worth of unused AA that you can use in 2018/2019.

Rising Auto Enrolment Pensions Contributions

Employers and employees are being contacted by the Pensions Regulator to remind them that 6 April 2019 will see the minimum pension contribution rise as follows:

Duration

Employer Minimum (%)

Total minimum contribution (%)

Current Contributions

2

5

Contributions from 6 April

3

8

Increases to the Minimum Wage

Employers can incur penalties if they do not adhere to the rules for National Minimum Wage (NMW) and National Living Wage (NLW) which are due to increase from 1 April. Different people are eligible for different levels of NMW and NLW, depending on circumstances, as explained in this table. The size of a business has no bearing on the level of NMW or NLW due to the employee.

 

Until 31 March

From 1 April

NLW for workers aged 25 and over

7.83

8.21

NMW main rate for workers aged 21-24

7.38

7.70

NMW 18-20 rate

5.90

6.15

NMW 16-17 rate for workers above school leaving age but under 18

4.20

4.35

NMW apprentice rate, for apprentices under 19 or 19 or over and in the first year of their apprenticeship

3.70

3.90


2019/2020 Scottish Income Tax Bands

New income tax bands will come into effect for Scottish taxpayers for 2019/2020, as was announced in the Draft Scottish Budget in December 2018. The new rates and bands will be as below:

Scottish Bands (£)

Band Name

Scottish Rate (%)

0 - 2,049

Starter

19

2,050 - 12,444

Basic

20

12,445 - 30,930

Intermediate

21

30,931 - 150,000

Higher

41

Over 150,000

Top

46

Company Car Advisory Fuel Rates

New company car advisory fuel rates have taken effect from 1 March. As per the guidance: “You can use the previous rates for up to one month from the date the new rates apply...” Please note that the following figures are only for employees using a company car.

Engine size

Petrol

1400cc or less

11p

1401cc - 2000cc

14p

Over 2000cc

21p

Engine size

Petrol

1400cc or less

7p

1401cc - 2000cc

8p

Over 2000cc

13p

Engine size

Petrol

1600cc or less

10p

1601cc - 2000cc

11p

Over 2000cc

13p

Please note that these rates apply in the following conditions:

1. When reimbursing employees for travel undertaken in company cars for business, or
2. When requiring employees to reimburse the employer for fuel used in private travel.

The rates do not apply in any other situation. For my on this, please see the official HMRC guidance.

Start Date for Making Tax Digital for VAT Is On The Horizon

It has been confirmed that there shall be no further delays in rolling out Making Tax Digital (MTD) for businesses. The news came from Mel Stride, Financial Secretary to the Treasury, as he made his statement to the House of Commons.

For most businesses the start date is due to be either on or after 1 April of this year, however there shall be an opportunity for “more complex” businesses to defer their start date until as later as 1 October 2019.

HMRC Advice: Prepare for No Deal Brexit

Businesses are being urged by HMRC to have a contingency plan ready in case a no deal Brexit really does come to pass. Preparing now will at least ensure that business can continue to trade with the EU in the event of the UK leaving the EU without a deal.

HMRC’s advice:

1. Registering for an Economic Operator and Registration Identification (EORI) number will allow businesses to continue trading with the EU. At the moment only 17% of relevant businesses have an EORI number.
2. Each affected business should choose how they will make their customs declarations. Most choose to use a customs agent for this.
3. According to HMRC, registering for new Transitional Simplified Procedures (TSP) “will allow businesses to import without having to make a full customs declaration at the border, and postpone paying any import duties. For imports using other locations, and for exports, standard customs declarations will apply.” This is of particular use to businesses using roll on, roll off locations to import goods into the UK from the EU.

Mel Stride MP, Financial Secretary to the Treasury, has said:

“We want businesses to be able to continue trading with minimal disruption in any scenario but we also know that people tend to leave things until the last minute and we would urge against that.”

Spring Statement 2019

As Brexit rumbles on the typical business of the country and government also continues. 13 March saw Chancellor Philip Hammond present the latest Spring Statement.

The Chancellor used his speech to update the country on the economy. He also responded gave his take on the Office for Budget Responsibility forecasts. His speech also saw him launching new consultations and update the country on earlier ones too.

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