News

• Strengthening civil deterrents for offshore evaders: HMRC are asking for comments on the options for changing the way they calculate the penalties for offshore evasion and potential safeguards.
• Civil sanctions for enablers of offshore evasion: This consultation sets out the government’s plans to introduce new civil sanctions for enablers of offshore tax evasion. 

The charity sector has been buoyed by the publication of fresh HMRC guidance on the VAT treatment of supplies of direct marketing.

The move comes in light of criticism from charities of unclear Revenue information following a policy change that meant printing and delivery of mail packs would no longer be zero rated

Payrolling benefits

Draft regulations on payrolling all benefits other than accommodation, beneficial loans, credit tokens and vouchers have been published for technical consultation. The additional reporting requirements for employers payrolling cars will be introduced from April 2017. Comments should be emailed by 2 September.

The Office of Tax Simplification (OTS) will be established on a statutory basis as a permanent and independent arm of the Treasury, the government has announced.

Documentation of last week’s Budget confirms that OTS will increase its staffing level and take on a wider role, looking further into the implementation of its own ideas to generate clear maps for tax reform, as well as continuing its study of specific areas of the system on a project basis.

The tax and National Insurance (NI) treatment of professional sportspeople’s income from testimonials and benefit matches is to be put on a firm legislative basis.

The government move comes as the result of HMRC view that the handling of such income does not reflect the statutory position.

A technical note and call for evidence issued in October proposed that the Revenue rewrite its guidance on the treatment of testimonial and benefit games.

The government is to go ahead with its controversial proposal to allow HMRC access to taxpayers’ bank and building society accounts.

The power of direct debt recovery (DRD) will allow the Revenue to take payment of tax and tax credit debts from accounts.

It will have effect from the date of royal assent of the summer Finance Bill 2015, while draft secondary legislation will be published with the bill for consultation.

HMRC will receive an extra three quarters of a million pounds to fund their ongoing fight against tax dodging, the chancellor announced this afternoon.

The move to combat non-compliance and criminal activity was welcomed by the Association of Revenue and Customs (ARC), which represents the taxman’s senior staff members. The union’s president, Tony Wallace, claimed the £750m injection “will yield a significant dividend for the country”.

The first wholly Conservative Budget in almost 19 years sparked largely optimistic reactions from tax experts today, with George Osborne’s plans described as “entirely sensible”, “pleasing”, and akin to the work of one of history’s greatest artists.

“The chancellor resembled Michelangelo as he re-sculpted the UK tax system, taxing dividends, proposing changes to pensions, adding a new tax on banks, cutting corporate tax rates, and restricting interest relief on buy-to-let investments,” said EY’s head of tax policy, Chris Sanger.

Essay contest

The winner of the second annual ICAEW Tax Faculty essay contest, sponsored by Tolley, was Alexandra Moss from Smith & Williamson for A Person’s Home May be their Castle, but Should the Family Home be Taxed and if so How and When? She receives £1,000 cash, a set of Tolley’s Yellow and Orange handbooks and a complete set of Tolley’s tax annuals.

A record amount of inheritance tax (IHT) was paid into the public purse during April, new figures show.

HMRC received £379m in the same month in which the Conservative party said it would raise the IHT threshold to £1m for some taxpayers – a pledge that looks set to be fulfilled in this week’s Budget.

The UK’s plans for delivering tax-free childcare are lawful, the Supreme Court has ruled, leading the government to confirm that the scheme will be launched in early 2017.

The current voucher system, employer-supported childcare, will remain open to entrants until the new set-up comes into place, providing an estimated 1.8m families with up to £2,000 of childcare support per child per year.