News

VAT seizures increase

The number of businesses that have had assets seized and sold by HMRC to pay overdue VAT bills has increased, according to Syscap, an independent finance provider. Figures obtained by the firm show that 14 times more businesses were targeted last year than five years ago. In 2012/13, 3,657 businesses had assets seized by the Revenue using powers of distraint, compared with 263 in 2008/09. The taxman raised £95.2m from distraint for VAT last year.

The government is consulting on how to clamp down on charities being set up to avoid tax. Last year’s autumn statement included the move to bring forward rules aimed at keeping charities from being abused by parties seeking a tax advantage

HMRC already have the legislative means to challenge certain schemes, but Exchequer officials hope to shape more laws to deter a greater number of tax dodgers.

HMRC have fixed a problem with their business tax dashboard that caused employment records to merge on the department’s systems.

The error hit some firms that employed a work to do more than one job within the same PAYE scheme, and resulted in erroneous consolidation of the separate employments.

Affected accounts were incorrect on the business tax dashboard – but the Revenue has updated the employer records, which will be displayed as follows:

Tax adviser Christopher Lunn is to be retried, after a jury at Southwark crown court failed to return verdicts on four counts of cheating the public revenue.

The East Sussex accountant, whose full name is Denis Christopher Lunn, was found not guilty of two further counts of tax fraud.

His case will be heard again in September 2015.

HMRC have published a note to clarify the interaction of the enterprise investment scheme (EIS) and co-productions in film and television and, in particular, the eligibility of co-productions to access the EIS.

Each party in a co-production controls a part of the project and raises the necessary finance, with the majority producer responsible for collating the parts into a finished film or programme.

All parties, who usually share income in the same ratio as their input, jointly own intellectual property.

HMRC are set to introduce enhanced functionality to their toolkits as part of the department’s annual maintenance cycle to review and refresh content.

The move follows requests by tax agents for means to complete the checklist section for a client and then have the option to save it electronically or print it.

The first two toolkits to be upgraded will be those that cover expenses and benefits from employment and National Insurance contributions and statutory payments. Both are due to be published on 6 April.

False self-employment

HMRC took a record £122m in extra tax in the past year from investigations into false self-employment of construction contractors, up 55% on the £78.9m yield of 12 months earlier. The figures come from accountancy NoPalaver Group, which warned that the Revenue is “cracking down” on workers who do not appear to meet the criteria for being self-employed.

PAYE guide

HMRC have published a three-step guide on YouTube to help employers make a successful final 2013/14 PAYE submission.

HMRC have changed their advice on the Construction Industry Training Board (CITB) levy, following a backlash from building firms.

The Revenue announced in January that it would no longer allow contractors to recoup the CITB charge from subcontractors in the form of a deduction made from the “gross amount of payment” on monthly returns.

A committee of the European parliament has approved an amendment to the Fourth Anti-Money Laundering Directive, which would make details about individuals behind trusts publicly available for the first time.

Under the plan, each member state of the European Union would be required to keep and make available a register of information on the ultimate beneficial owners of privately owned companies, foundations and trusts.

Earnings from trading with the virtual currency bitcoin are to be free of VAT, HMRC have announced.

The tax department has set out its position on the treatment of income received from and charges made in connection with activities involving bitcoin and other cryptocurrencies.

Bitcoin operates through a peer-to-peer network, independent of any central authority or bank; transactions are recorded in a shared public database called a block chain.

Students’ tax

The Low Incomes Tax Reform Group has launched an online tax guide for students. It is sponsored by the Chartered Institute of Taxation, funded by a grant from HMRC and operated in partnership with the National Association of Student Money Advisers. The offering covers a range of issues likely to affect students, including part-time employment, loan repayments, tax refunds, and tax credits and benefits

HMRC are set to close all open periods of contracting out on taxpayers’ National Insurance (NI) records. The move will be to supply individuals with details of their occupational pension rights when contracting out ends in April 2016.