News

The US tax authority, the Internal Revenue Service (IRS), has announced a relaxation of enforcement and administration of the due diligence, reporting, and withholding provisions under FATCA for 2014 and 2015 for entities that have made “good faith efforts to comply” with the regulations. (See IRS notice 2014-33 Further Guidance on the Implementation of FATCA and Related Withholding Provisions.)

Landlords can no longer claim tax relief for the replacement of white goods in unfurnished residential lettings, HMRC have confirmed.

The department’s announcement to the ICAEW Tax Faculty and the Chartered Institute of Taxation follows the withdrawal from April 2013 of extra-statutory concession B47.

Late PAYE payments will incur in-year interest charges for the first time, HMRC have warned following last month’s introduction of a regime that replaces annual levies.

Firms that want to avoid the new-style charges, which also apply to the construction industry scheme, should settle with the Revenue by the due date – 19th or 22nd of the month – the difference between what they report on their full payment submission (FPS) together with CIS charges for the tax month, and the deductions reported on an employer payment submission (EPS).

HMRC aims to stay claims for compound interest

Professional fees

The Income Tax (Professional Fees) Order SI 2014/859 amends ITEPA 2003, s 342 and adds a further two categories of professional fees to those allowable. First, a trainee registration fee providing evidence of a person’s suitability to be awarded a certificate of completion of specialist training in dentistry. Second, a fee to enter a name on any list or register of veterinary nurses maintained by the Royal College of Veterinary Surgeons.

HMRC have published further guidance on eligibility for the employment allowance.

It includes clarification of “functions either wholly or mainly of a public nature”. Where more than 50% of the work of a business falls into the category, the allowance cannot be claimed. For example, a doctor’s surgery for NHS patients comprising 90% of a GP’s work.

Other areas include:

The government must exercise caution in its plans to take the tax system online, according to the new president of the Chartered Institute of Taxation (CIOT).

Anne Fairpo, who succeeds Stephen Coleclough, believes “wild enthusiasm for the wonders of technology [ought to be] tempered with practical reality”, not least because not everyone wants to deal with their own tax affairs digitally.

The first complete tax year under real-time information (RTI) for the majority of employers worked well, with only one major problem, according to the taxman.

HMRC have been conducting weekly end-of-year teleconferences with employer representatives since 31 March, at the request of Payroll Alliance, the LexisNexis service.

The department says information for 2014/2014 flowed through to its systems as expected, with the only significant obstacle being the Government Gateway server crash on 11 April.

The annual allowance for retirement savings has fallen to £40,000 from £50,000.

The change – with effect from 6 April 2014 – means pensions contributions in excess of the cap during a tax year may be subject to a charge, which must be declared on a self assessment tax return.

But unused allotments from previous periods can be carried forward for up to three years to cover excess contributions. There are two calculators:

HMRC now calculate tax credits awards through the real-time information (RTI) system.

The new set-up – effective from 6 April 2014 – means renewals notices will show the total gross pay for the year, which may be from more than one source.

Claimants should check that income details shown are correct and contact the Revenue as soon as possible if they think the information is wrong, the tax department said.

Some claimants may contact their employer or pension provider if they think the income is wrong. In which event, the employer or pension provider should: