Toni Hunter's SuperBlog » Experiences

More power to HMRC

Toni — Tue, 03 Apr 2012 22:00:41 +0000

New powers to tackle PAYE debtors

HM Revenue and Customs (HMRC) will have new powers to tackle companies which fail to pay their employees’ income tax and national insurance contributions.

Upfront demands

From April, HMRC will be able to demand an upfront security from firms it deems to pose a serious risk of not paying. In particular, HMRC will be targeting companies which deduct money from their employees’ pay packets but have no intention of paying it to the tax office.

The new measures are an extension of existing powers which HMRC has in respect of VAT, insurance premium tax and environmental taxes.

It is hard to believe that this a “new” power as without it compliant taxpayers are not being treated fairly.

Possible penalties

Businesses failing to provide a security will face a fine of up to £5,000 which will be enforceable by the courts.

HMRC have said that employers facing genuine payment difficulties will not be affected by the change.

Source: Total Investor 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.

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5 things you may not know about charities: No5

Toni — Fri, 04 Nov 2011 07:56:02 +0000

Trustees Liability

In the past trustees have been worried that they may be personally liable for mistakes they make which put charitable assets at risk.

The Charities Act 2006 (which is still being implemented in phases) introduces two small but important changes.

Indemnity Insurance

If trustees act prudently, lawfully and in accordance with their governing document, then any liability trustees incur may be met by the charity’s resources.

Charities can take out insuracne to cover such circumstances.

Any breach of trust will result in the trustee being personally responsible fpr making good any loss to the charity. Since trustees are acting as a collective governing body, they will usually be jointly and severally responsible.

Personal Liability Insurance

Trustees are now able to procure trustee indemnity insurance using the charity’s funds, to protect them from personal liability to third parties. This is still deemed to be a trustee benefit but it is no longer a requirement to gain permission from the Charity Commission provided that the governing document does not prohibit it.

Fair use of charitable resources?

Trustees need to consider the nature or the charity’s activities, the degree of risk to which the trustees are exposed, the number of trustees to be covered and the cost to the charity of paying the premiums when deciding whether insurance is a good use of resources.

Of course, there is nothing stopping trustees from arranging and paying for their own policies.

5 things you may not know about charities: No3

Toni — Tue, 01 Nov 2011 08:45:36 +0000

Gift Aid

If you are a UK taxpayer and you make a donation to a registered charity, gift aid can be claimed by the charity. Effectively, the Government give the basic rate tax that the donor has paid on the amount they have pledged, to the charity.

From the year 2000 onwards there is no minimum or maximum donation value for applying gift aid.

The amount of gift aid pledged by taxpayers and not claimed by charities runs in to several million pounds.

If the donor is a 40% taxpayer, the charity will receive the basic rate tax, currently 20% and the donor can claim the remaining 20% via their Self-Assessment Tax Return. They can therefore afford to donate more!

How

The donor completes a Gift Aid declaration (see below) with their name, address and the date.
The charity fills in a claim form and send it to HMRC.
HMRC makes a payment direct to the charity for the amount of basic rate tax claimed.

Example Declaration

“I wish the enclosed donation for £xx and any future donations I make to this charity to be treated as a Gift Aid donation. I am a UK taxpayer”

5 things you may not know about charities: No2

Toni — Fri, 28 Oct 2011 07:45:31 +0000

Economic Contribution

There are approximately 200,000 registered charities in England and Wales, generating income of more than £50bn per annum (c.3% GDP)

Government grants/contracts make up up around 36% of funding. (27% in 1991)

80% of registered charities have annual income of less than £25k per year.

The sector employs around 750,000 paid staff and is governed by approximately 1 million trustees.

5 things you may not know about Charities: No1

Toni — Thu, 27 Oct 2011 07:45:55 +0000

History

The first “charitable organisation” was the King’s School in Canterbury, formed in 597AD.

The Victorians were very philanthropic and created what we now recognise as NSPCC and Barnados.

It wasn’t until 1942 that Oxfam (Oxford Committee for Famine Relief) changed the face of the sector with it’s worldwide missions and opened one of the world’s first Charity shops in 1948.

New fuel rates for business mileage

Toni — Wed, 04 May 2011 10:29:47 +0000

On 1st March 2011, HMRC finally increased their allowable fuel rates to better reflect the sustantial increases in fuel prices we have all been suffering.

To make sure you are using the correct rate to get maximum tax benefit click here.

For more business news updates like this, please subscribe to my monthly business support newsletters using the “join my lists” widget in the top right of your screen. Thank you.

Charities: Do volunteers have rights?

Toni — Mon, 18 Apr 2011 10:46:58 +0000

Earlier this year, a Court of Appeal held that a volunteer working for a charity could not pursue a claim under the Disability Discrimination Act 1995 because she did not have a contract and didn’t qualify as an employee. Although the case was in relation to disability discrimination, the principles apply to all other areas of discrimination.

Time for charities with volunteers to breathe a sigh of relief. Or is it? Charities who have volunteers must ensure that they are getting the relationship right, both in terms of the legal description and the practicalities of how volunteers work.

To make sure you get it right follow these simple rules from Keeping HR Simple

It’s not about you…..

Toni — Sat, 12 Feb 2011 23:59:06 +0000

As an avid networker, I am constantly intrigued by “experts” offering networking advice to small business owners.

Personally, I have rarely struggled with networking. In fact, I find it enjoyable and sometimes exhilarating, but I completely understand why for many it is an uncomfortable experience.

I recently read a blog post about being self-conscious when at networking events that I felt worthy of sharing with you, because it offers clear advice that I am in complete agreement with – It’s not about you!

http://myescapevelocity.com/take-the-self-out-of-self-consciousness-when-youre-networking

To summarise the author, Liz Strauss writes:

“Everyone likes an intelligent, interested person who gives us true attention.
We all like people who ask meaningful questions and listen to how we answer them.
I learned that being that person makes walking into a room of strangers easier to do”

So, next time you are at a networking event, stretching your comfort zone, anxious and sweaty palmed, take the heat off yourself and focus on others and you will be surprised what an adept networker you will become.

For further tips on developing your networking skills, try “Joined Up Networking” by Heather Townsend.

changes to pension contribution levels

Toni — Thu, 10 Feb 2011 21:49:51 +0000

If you have a pension, then you are about to see a significant reduction in the amount of money you can put into it without paying tax.

From next April

The Government will slash the annual tax relief limit on pensions from £255,000 to £50,000. There will also be a reduction in the lifetime allowance on money that can be saved in a pension fund from £1.8 million to £1.5 million, which will come into effect from April 2012.

The Government hopes the changes will save it more than £4 billion a year, which it will use to tackle the budget deficit.

Warning

Experts have already warned that some people with long service in final salary pension schemes could suddenly face higher bills, particularly as the increase in accrued pension will now be multiplied by a factor of 16 instead of the current factor of 10.

However, the Government says that the changes would affect 100,000 pension savers a year, 80% of whom earned more than £100,000 a year, meaning that very few people earning less than that amount would actually have to pay any pension tax.

Utilising your allowance

Anyone with unused annual allowance from the last three tax years will be able to carry them forward if they are a member of a pension scheme during that period, meaning that if a pension contribution is more than £50,000 then they may not have to pay the annual allowance charge.

At George Hay, we can advise you on all aspects of pensions, including how the above changes might affect you.

For further information on whether you are getting the best from your pension, please contact us.

Don’t let the taxman spoil your party

Toni — Tue, 14 Dec 2010 21:53:40 +0000

If you are planning to treat your employees to a festive event, take care not to create a taxable benefit, that would certainly make your event expensive for both your business and your staff – Bahh Humbug!

The rules clearly state that employers can spend up to £150 a head annually on staff events, not a penny more. If the total cost of the event (including travel, accommodation etc) divided by the number who attended equates to £150.01 the whole amount is taxable.

The £150 is inclusive of VAT and can be spent on one or more events in the tax year. The type of event you chose is not an issue, but all employees must be invited and it must be considered an annual event. So a one-off party to celebrate a retirement for example does not qualify.

Unfortunately, you need to plan and budget carefully. Its a delicate balance between being a generous, hospitable boss and playing Scrooge.