News

Luxembourg’s approval of Amazon’s transfer pricing arrangements probably amounted to illegal state aid, according to the European Commission in a document addressing the grand duchy.

The 23-page paper asks Luxembourg tax officials to provide more information on the background to their agreements with the retail giant, and warns that all “unlawful aid may be recovered from the recipient”.

HMRC are asking small companies about easing the process for claiming research and development reliefs.

A consultation paper aimed at firms and their advisers covers:

Northern Ireland and Wales

The Corporation Tax (Northern Ireland) Bill provides for the devolution of tax powers to the Assembly and should allow Ulster to set its own rate of corporation tax from April 2017. Non-trading profits such as income from property are excluded, and power over the corporation tax base will remain with the UK parliament. The Wales Bill has received royal assent. It devolves a range of tax-raising powers to Wales.

HMRC have extended the registration deadline of their contractor loan settlement opportunity.

Taxpayers now have until 30 June to notify the department that they wish to take part in the tax disclosure facility that was originally scheduled to close on 9 January.

A contractor loan scheme settlement is an arrangement in which a non-UK employer pays a worker untaxed income or a loan, instead of all or part of a salary. Individuals who take part in such a scheme may still have to pay income tax.

Employers are set to receive the first quarterly notices under real-time information’s late-filing penalties regime, which began in October for businesses with 50 or more members of staff.

Firms that have incurred fines can expect the HMRC messages from the beginning of February, according to the department. Advisers will not be sent a copy, but each notice will instruct employers with agents to pass on the correspondence immediately.

An accountant who grossly under-declared his income has been jailed for 16 months, after pleading guilty to seven tax fraud offences totalling in excess of £65,000.

HMRC found Stephen Douce, co-director of ACA Accountancy Services Ltd, Derby, claimed he and his wife both had an annual household income of only £4,500, when in fact he earned more than £56,000 a year.

His false self assessment submissions meant he evaded income tax and National Insurance contributions of £18,203.79 for himself and £1,591.21 for his wife.

Horses’ mobile homes are the latest target for HMRC investigators in their efforts to weed out tax evaders, experts have warned.

The Revenue suspects that some farmers and other rural concerns dishonestly claim luxury horseboxes as business expenses, according to accountancy group UHY Hacker Young, while other countryside firms fail to declare personal use of the vehicles, to dodge tax on benefits in kind.

Self assessment forums

HMRC will hold open chat forums in January in January to answer questions about self assessment. Dates for the online events can be found on GOV.UK

The government does not plan to give itself powers to significantly alter the direct recovery of debts (DRD) rules by statutory instrument, Taxation has learned, following fears of a legal provision to enable the amendment of primary legislation.

HMRC have introduced a new online payment service for taxpayers who wish to settle their self assessment and VAT bills by debit or credit card.

The system was launched by the department in beta mode on December 2014, in partnership with card processing provider Worldpay.

Taxpayers still have the option of paying by card using the Billpay service hosted by Santander Corporate Banking – which the Revenue expects to be superseded by the Worldpay equivalent.

HMRC have launched a consultation on the closure rules for enquiries, to examine the current process and the restrictions it puts on the department in resolving one or more aspects of an enquiry.

The Revenue is seeking views on plans to streamline the system by enabling tax officials to obtain early closure of one or more facets of an enquiry, when it is not appropriate to close the whole matter.

Secondary legislation is set to simplify PAYE regulations from 6 March 2015. The change will remove the requirement for employers to complete the end-of-year checklist when making their final full payment submission (FPS) for the year from 2014/15.

The checklist comprises a box on the FPS that opens the end-of-year declaration, consisting of seven questions. This was a feature of the now defunct P35, which was incorporated into the design of the FPS.