July Tax Update

Last month our intrepid Marketing Manager, Nellie, took to the Pembrokeshire Coast to hike a not inconsiderable 100km in just five days to raise money for CoppaFeel!.  The total ascents amount to 4,487m – the equivalent of climbing the UK’s three highest peaks and doing Ben Nevis twice!  There’s still time to donate.

Compliance

Final call for those who need to file P11ds: They are due for submission by 6 July (this Wednesday).  P11ds should be issued to employees who have, at some point during the previous tax year, received a taxable benefit from their employer that has not been reported via payroll.  This can include private health or dental care, company car, or low interest loans.  Employees in receipt of such benefits should ensure their employer provides them with the P11d by 5 July, which they can then pass to their tax advisor to include in their self-assessment tax return (hint hint).

It has also just been announced that, following the Bank of England’s base rate hike, HMRC will be increasing the interest charge on late payment of tax.  With the exception of corporation tax paid by instalments (2.25%), from 5 July 2022 all taxes paid late will attract a 3.75% interest charge.

Advisory

Following on from last month’s report that more people are being brought into the charge for inheritance tax, we have seen an increase in the number of people looking to structure their estates in a tax efficient manner.  It was Labour Chancellor Roy Jenkins who said that “inheritance tax is a voluntary levy that is paid by those who distrust their heirs more than they dislike the Inland Revenue”.

Disclosure

Back in April HMRC issued a new settlement opportunity in relation to so-called ‘Remuneration Trusts’.  The RTSO offers users the chance to disclose funds received as either salary, dividends, or director’s loans (dependent on the specific circumstances of each case).

The deadline for those wishing to settle with HMRC, the deadline is 31 July 2022 and in our experience settlement terms get worse the newer the opportunity, so whilst each case should be viewed on its own merits, generally it’s more advantageous to settle earlier than later.

If you’ve not done so already it’s perhaps time to speak to a specialist advisor who can assist in calculating the potential liabilities and even advise whether or not HMRC are in time to open an enquiry or raise assessments.  Whilst the expectation should be that HMRC are always right, in some isolated cases they have been known to push the boundaries of their powers – it’s therefore worth speaking to a professional with relevant experience before engaging directly with HMRC.

Code of Practice 9

We embarked on writing a three-part case study based on a suspected serious fraud case and contractual disclosure made to HMRC. You can catch up on Part 1 and Part 2. The articles highlight the peril of a HMRC enquiry let alone a full fact suspected serious fraud case. The time, anxiety and distraction caused to those under enquiry is consuming. It is even worse when HMRC are allowed to expand their enquiries and are not reigned in. We are glad to offer continued support to our network of advisers and Anton is consistently happy he has made a career out of arguing with HMRC.

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