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Tax Calculations
HMRC provides guidance on the taxation of air miles and similar benefits
Monday, August 15th, 2011When employees obtain air miles or other rewards when they pay for business travel and subsistence is there a benefit that must be reported for tax purposes by the employer? Prompted, no doubt, by extensive recent discussion on the Linkedin website, HMRC has clarified the tax status of air miles, petrol tokens, credit card points [...]
P800 Tax Calculations for 2010/11 now being issued
Sunday, August 7th, 2011HMRC has started to send out Tax Calculations for the 2010/11 tax year. The annual process of issuing P800 Tax Calculations to taxpayers who have either overpaid or underpaid tax during the 2010/11 tax year began in July. HMRC is issuing Calculations for overpaid tax initially and those for taxpayers who have underpaid tax will [...]
Government consults on definitions of ‘tax residence’ and ‘ordinary residence’
Friday, June 24th, 2011Proposals to clarify the tax status of individuals coming to work in the UK. There are no statutory definitions of the terms “tax residence” and “ordinary residence”, with the result that there can be uncertainties over the tax status of individuals coming to work in the UK. A new consultation document, published by HM Treasury [...]
Guidance on the tax relief changes for employer-supported childcare
Monday, April 11th, 2011HMRC provides initial guidance on the tax relief restrictions for employer-supported childcare and performing the “basic earnings assessment”. HMRC published a new draft guidance document on 6 April which will be finalised when the Finance Bill gains Royal Assent. However, as the equivalent NICs regulations have already been made by means of the Social Security [...]
P11D Working Sheets, qualifying childcare, tax simplification, NEST, credit card fees, 0T legislated, SMP compensation rate, Worker Registration Scheme, P60s, and so many forum questions.
Friday, March 18th, 2011This week we are back to normal with (too) many news items. Of particular interest and importance are the two reports from the Office of Tax Simplification, which resurrect a number of proposals from earlier years, some of which may well find their way into the coming Budget. The PAYE Regulations have been updated with [...]
Further changes to the definition of ‘qualifying child care’
Friday, March 18th, 2011Sections 270A and 318A of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA) provide limited tax exemptions for the provision of childcare vouchers and employer-supported childcare. One of the conditions that must be met in order for these exemptions to apply is that the childcare must be “qualifying child care”. The definitions of “qualifying [...]
Recommendations from the Office of Tax Simplification
Friday, March 18th, 2011The Office of Tax Simplification (OTS) is tasked by the Treasury with simplifying tax reliefs and small business taxation (including the IR35 rules) and making recommendations to the Chancellor in advance of Budget 2011. In November 2010 the OTS published the first ever comprehensive list of the UK’s tax reliefs and allowances on its website, [...]
Coding notices for the 2011/12 tax year
Friday, February 25th, 2011The following are extracts from the latest weekly informal updates (dated 11 and 18 February) from HMRC to employer representatives. P9s – Annual coding message for employers We have recently begun the annual process of sending out Coding Notices (P2) for the 2011-12 tax year to individuals. You may well get questions from your employees [...]
Contracting-out Rebates
Monday, February 14th, 2011The Government is required by law to review actuarially the National Insurance contracting-out rebates for defined benefit and defined contribution pension schemes every five years. The rates that will apply from April 2012, subject to confirmation, have been announced in a draft Statutory Instrument. The contracting-out rebates for defined benefit schemes apply to contracted-out salary [...]
New double taxation agreement with Bahrain
Monday, February 14th, 2011On 3 February, the Isle of Man signed a new double taxation agreement with Bahrain. The agreement will enter into force following confirmation by both parties that their necessary legal procedures have been completed. The provisions of the agreement will then have effect from 1 January of the following year. Further information: Isle Of Man [...]
Upper Tax Tribunal resolves SMP issues in the Deborah Wade case
Friday, January 21st, 2011In September 2009, the First-tier Tax Tribunal gave its decision in the case North Yorkshire Police and Mrs Deborah Wade v The Commissioners for HM Revenue and Customs. This was the first judicial decision on a matter concerning statutory payments since administration of the SMP/SAP/SPP schemes was transferred to the Inland Revenue (now HMRC). The [...]
Jersey – Budget Statement 2011 tax proposals
Friday, January 21st, 2011The following increases in the income tax exemption limits are proposed for 2011, reflecting the 1.1% increase in average earnings during 2010. The historically generous tax thresholds in Jersey mean that many Islanders still pay less tax than in most neighbouring territories. The income tax payable by a married couple in 2010 with a joint [...]
Questions from our forum 13/01/11
Thursday, January 13th, 2011Each week we receive a number of payroll questions on our forum, and here are this week’s batch. Can you help with any answers? Forum Posts: Backdating SMP If an employee has been on maternity leave, for around 6 months, but has continued to be paid her full salary as normal, for whatever reason, is [...]
Possibly HMRC’s final last words about tax code 0T….again!
Friday, December 31st, 2010Just when we thought we had all of the new uses for tax code 0T sorted out, HMRC issued an email apologising for an error is the guidance given in the latest Notes for Payroll System Developers. Both in HMRC’s correspondence with us and in the latest guidance for developers, we had been told that [...]
Double Taxation Agreements
Friday, December 31st, 2010The Double Taxation Agreement between the UK and Hong Kong, signed on 21 June 2010, entered into force on 20 December 2010. It is effective in the UK from 1 April 2011 for corporation tax purposes, and from 6 April 2011 for income tax and capital gains tax. It is effective in Hong Kong from [...]
Possibly HMRC’s next last words about tax code 0T
Friday, December 17th, 2010In our article two weeks ago, we mentioned a number of situations where HMRC’s guidance on the use of tax code 0T from April 2011 needed clarifying in terms of whether it should be applied cumulatively or non-cumulatively. We have received replies from HMRC, as follows: Where box C of form P46 is selected by [...]
One HMRC telephone number for employee tax enquiries
Friday, December 17th, 2010Employees now have a single telephone number to use in order to discuss their tax queries with HMRC – 0845 300 0627. It replaces more than 60 old numbers, which will soon be taken out of service. Employers can also use this number, for example to confirm an employee’s tax code. But the Employer Helpline [...]
Consultation on draft legislation for Finance Bill 2011
Friday, December 17th, 2010The policy of the Coalition government is to confirm most of its new tax measures at least three months before the introduction of a Finance Bill. The draft text of the legislation that will appear in the Finance Bill 2011 was published on 9 December and is open for technical comment until 9 February 2011. [...]
Ireland: Employer copy of Tax Credit Certificates
Friday, December 17th, 2010The employer’s copy of employee Tax Credit Certificates (P2Cs) will issue through the Revenue On-Line Service by 15 December 2010. For Employers/Agents not registered for ROS, these certificates will be sent by post during the week commencing 13 December 2010. Revenue is asking employers, and agents who carry out payroll functions on behalf of employers, [...]
Consultation on PAYE Real Time Information proposals
Friday, December 10th, 2010HMRC received nearly 400 responses to the discussion document Improving the Operation of Pay As You Earn (PAYE) that was published last July. Nearly three-quarters of respondents who expressed a view were in favour of the Real Time Information (RTI) proposal and the Government has taken the decision to introduce it in stages from 2012. [...]
