Income Tax

Forde and McHugh Ltd v CRC, Supreme Court

A client made payments into a seed enterprise investment scheme and an enterprise investment scheme in 2012/13 and 2013/14. No certificates were received in time for submission of the 2012/13 tax return

Small enterprises such as hairdressers, window cleaners and cab drivers are being urged by HMRC to take advantage of the simpler system of recording income and expenses over the tax year.

Firms with an annual income of £79,000 or less can use the cash basis of accounting for money as it goes in and out of the business, rather than employing traditional method centred on accruals.

Redhill Islamic Centre Trust (TC3196)

P Donovan and P McLaren (TC3188)

A new annual flat rate expense allowance for laundering armed forces uniforms has been agreed between HMRC and the Ministry of Defence (MoD), with the figures set as:

• Navy – £80
• Army – £100
• Marines – £100
• RAF – £100

The allowance will be backdated to 6 April 2008, and claimants will receive the full amount due for each year of service, regardless of whether or not service started or ended part way through a year.

Step-by-step guide to setting up an enterprise management incentive plan

Leeds Design Innovation Centre Ltd, R Noble, R Watkiss and P Connolly (TC3150)

Share incentive plans (SIPs) and save-as-you-earn (SAYEs) schemes will see higher limits from 6 April.

The maximum value of free shares that can be awarded in a SIP will rise from £3,000 to £3,600 a tax year, while partnership shares will be capped at £1,800 (from £1,500), subject to the figure being no more than 10% of an employee’s annual salary.

The maximum monthly amount an employee will be able to contribute to SAYE savings arrangements will go up from £250 to £500.

The penalties regime of the real-time information (RTI) reporting of PAYE will not begin October, HMRC have announced, signalling a six-month postponement.

Automatic fines for late filing and overdue payments were due to begin on 6 April, but the Revenue has introduced a delay after finding it needed time to improve RTI systems and guidance.

The new timetable will be:

Under an unfunded unapproved retirement benefits scheme, an employee and their employer had agreed that a pension of £85,000 a year would be paid. Instead, a lump sum of £1.4m was paid to the employee

The economic outlook is improving, says the Institute for Fiscal Studies, but problems lay ahead