Posts tagged ‘Act’

HM Revenue and Customs (HMRC) has always taken a dim view of the late filing of self-assessment tax returns, but it has now introduced significant new penalties for those who fail to meet the deadlines.

The deadline

If you are registered for self-assessment and have not already filed your paper return then you will need to do so online by 31 January 2012. This may still seem a long way off, but it makes sense to start preparing now rather than leaving your return until the last minute, when it will be more difficult to deal with any issues which may arise.

The penalty

Back of the net!Under HMRC’s new regime, late returns will incur an initial fixed penalty of £100.

This will apply even if there is no tax to pay or any tax due for the year has already been paid on time.

If your tax return has still not been filed after three months, then HMRC will impose additional daily penalties of £10, up to a maximum of £900.

After six months, the penalty increases to either £300 or five per cent of the tax, depending on which is greater.  The penalty could increase to 100 per cent of the tax due if returns have still not been filed after 12 months.

Late tax

Any overdue tax must also be paid by 31 January.  If this deadline is missed then HMRC will impose a penalty of five per cent of the amount due after 30 days, six months and 12 months respectively. It is also worth noting that HMRC will charge interest on top of these penalties.

The Art of ProcrastinatingStop procrastinating

As with any tax matter, it is always better to act sooner rather than later.

The longer you leave it, the bigger the penalty will be.

 

 

At George Hay, we can assist with a wide range of tax matters, including ensuring your self-assessment tax return is filed on time.

Friendly, approachable, reliable professionals

Disclaimer: This article is for general guidance only. All taxation planning should only be undertaken after appropriate professional advice. George Hay Chartered Accountants are registered to carry on audit work and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales.

From 1st October 2010, workers who earn the national minimum wage will see a difference in their pay packet.

What’s changing?

  • The age threshold and the hourly rate are increasing
  • The hourly rate for young workers is increasing
  • Apprentices are now covered by the minimum wage legislation, albeit at a lower rate
  • Employers will be able to offset the national minimum wage by £4.61 for each day that accommodation is provided.

Planned changes

While these new rules come into effect on 1st October 2010, further changes relating to temporary workers are set to come into force from 1st January 2011.

In particular these regulations focus on “potentially exploitative arrangements” surrounding tips and expenses.

Need more information?

For full details of the changes and rates, please click here

If you are an employer, then George Hay  can advise you on what the new national minimum wage means for your business. We can also help you ensure you comply with the regulations and help you plan around any changes.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.


The new ‘VAT online service’ (VOS) was launched by H M Revenue & Customs (HMRC) in November in prepartion for the compulsory online filing of VAT returns and electronic payment of liabiliies for VAT periods commencing 1st April 2010.

These new regulations will be enforced and effect all

  • existing VAT registered businesses with a turnover (excluding VAT) of £100,000 or more (taken from the previous four returns submitted)
  • businesses that register for VAT on or after 1st April 2010, regardless of turnover.

 

Once your business has been required to file online once, it must continue to do so.  The only exemptions are businesses involved in an insolvency procedure or those who have satisfied HMRC that the religious beliefs are incompatible with the requirement to use electronic communications!

If your business is VAT registered, you can expect to receive a letter from HMRC during February 2010 notifying you of your obligations.

There are proposals for this to be just the first step of the process and that all VAT registered businesses should manage their VAT returns and payments electronically from 1st April 2011.

The new VOS will enable users to

  • Register for VAT
  • Enrol for electronic filing
  • View previously submitted electronic returns
  • Set up email alerts to remind business owners of when returns should be submitted

Of course, if you do not want to be burdened with this, your accountant will be able to act as your agent in the same way as they can file payroll and self-assessment returns.  They will ask you to an authority to act (HMRC form 64-8 is not adequate for VOS) and may re-issue their letter of engagement to clarify the terms of this service.

More information can be sought from your accountant or HMRC’s online services website


The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post

Are you aware that the minimum retirement age is increasing to 55 from 6th April 2010?

This will mean that you will no longer be able to obtain an income or draw tax-free cash from your private pension before your 55th birthday except on the grounds of ill-health.

If you are aged 50 to 54 on 5th April 2010, you need to speak to your IFA as soon as possible to discuss your retirement plan as you will lose access to pension funds until you are 55 if you don’t act before 5th April 2010.  Please give your adviser time to administer your plans, there’s little point in approaching them at the end of March.

You have three options:

  1. Buy an annuity
  2. Transfer to an income drawdown scheme
  3. Do nothing and wait until your 55!

Retirement Road Sign with blue sky and clouds.Did you know that you do not need to physically retire to start taking income from your pension plan?  This means you could take your tax-free cash drawdown and reinvest it while you continue to work, giving you increased flexibility and control over your future.

Obviously taking cash from your fund will reduce its value so you need to talk to an adviser about the effect of this on the long term income you will derive from the plan.


The message here is clear, if you are 50 -54 years old and haven’t spoken to your IFA for some time, now is the time to do.  Don’t procrastinate, it could cost you dearly.


If you don’t have an IFA, I can recommend through personal and client experience, the advice of Chris Langdon at RHG 01438 345734. 

Please bear in mind that while accountants have a good working knowledge of retirement planning, most are not regulated or insured to give advice.  Make sure you are getting good quality advice bespoke to your needs from a professionally qualified  financial adviser.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.