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Newsletter
May 2008 |
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The Finance Bill 2008 continues
its progress through Parliament. You will no doubt have heard the debate
regarding the abolition of the 10% income tax band. The Chancellor has
promised that affected groups will be compensated. The compensation will
take various forms; for certain pensioners the compensation will come from
the same system that pays the winter fuel allowance; other low income
couples through potential changes to the tax credit system, and finally
younger workers by adjusting the minimum
wage. This month we have outlined the
potential cash flow benefits of switching to the VAT cash accounting
scheme, set out a few pointers for payroll administrators, provided you
with ways to check the validity of National Insurance and VAT numbers, and
finally outlined which State benefits are available to you if you are
self-employed. Our next newsletter will be
published on Wednesday 4 June 2008. |
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VAT
Cash Accounting |
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We seem to be entering a period
when banks are likely to have less money to lend, and when they do lend
interest rates charged will be "realistic". The self styled liquidity
crisis is with us! Consequently the management of
your cash resources will be critical in the coming months as businesses
chase liquidity by tightening up on their credit control. This process
will of course be frustrated as creditors hang on to cash reserves by
extending the credit they take from
suppliers. If your business qualifies, and
you are not already using the scheme, the VAT Cash Accounting scheme could
be a lifesaver. What are the rules of the cash
accounting scheme?
What are the advantages of
using the cash accounting scheme?
What are the disadvantages of
using the cash accounting scheme?
How does a business apply to
join the cash accounting scheme?
Will HMRC ever prevent a
business from using the scheme?
At what point may or must a
business leave the scheme?
If you would like us to check
out the viability of Cash Accounting for your business, please
call. Click here
for a call back from our office regarding this
article. |
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Payroll
2007-2008 |
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If you are filing your returns
this year in paper format, please work through the check list set out
below which highlights issues that will cause your return to be rejected.
If you are filing your Employer Annual Return (P14s and P35) online you
should find that these quality checks are built into your payroll
software. An Employer Annual Return (P14s
and P35) sent on paper will be rejected
if:
If you send your Return online
you will get an on screen message through your software telling you if
your Return has failed and why. You must put right any errors and re-send your
Return by 19 May 2008 to avoid the late filing penalty.
Filing
deadlines 19 May 2008 -
Last date for your 2007-08
forms P14, or substitutes, and P35 to reach your HM Revenue & Customs
office. You have until midnight on the 19th to file your Return. Penalties
are chargeable on any Returns received after this date.
31 May
2008 - Last date for giving a
2007-08 form P60 to each employee who was working for you at 5 April 2008.
6 July 2008 -
Last date for your 2007-08
forms P9D and forms P11D, or substitutes, to reach your HM Revenue &
Customs office. 6 July 2008 -
Return of Class 1A NICs on form
P11D(b) for 2007-08 to reach your HM Revenue & Customs office.
(penalties will be charged automatically on any Returns not received by 19
July 2008) 6 July 2008 -
Giving a copy of the 2007-08
form P9D, P11D, or equivalent information, to each relevant employee.
18 July 2008 -
If you are not subject to the
mandatory electronic payment rules and you post your payment, you should
pay all outstanding Class 1A NICs so your payment reaches HMR&C no
later than 18 July. Interest will be charged on any payments received
after this date (and surcharge in the case of employers who are subject to
the mandatory electronic payment rules). 22 July 2008 -
Last date for any outstanding
2007-08 Class 1A NICs payments to be cleared in HMR&C's bank account
if you pay by an approved electronic payment method. Interest will be
charged on any payments received after this date (and surcharge in the
case of employers who are subject to the mandatory electronic payment
rules). Click here
for a call back from our office regarding this
article. |
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Checking
the numbers - NINO's and VAT |
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Certain PAYE returns (P35,
P11D) will be rejected by HMR&C if a National Insurance number (NINO)
is incorrectly displayed. Valid numbers always follow the same format, two
letters, followed by six numbers, followed by a single letter. i.e.
AB123456D. The following information sets
out the valid alpha prefixes and suffixes. If you are at all uncertain
that you have been given a correct NINO, you should check with your local
tax office. Valid National Insurance Number
Prefixes: AA, AB, AE, AH, AK, AL, AM, AP,
AR, AS, AT, AW, AX, AY, AZ BA, BB, BE, BH, BK, BL, BM, BT CA, CB, CE, CH,
CK, CL, CR EA, EB, EE, EH, EK, EL, EM, EP, ER, ES, ET, EW, EX, EY, EZ GY
HA, HB, HE, HH, HK, HL, HM, HP, HR, HS, HT, HW, HX, HY, HZ JA, JB, JC, JE,
JG, JH, JJ, JK, JL, JM, JN, JP, JR, JS, JT, JW, JX, JY, JZ KA, KB, KE, KH,
KK, KL, KM, KP, KR, KS, KT, KW, KX, KY, KZ LA, LB, LE, LH, LK, LL, LM, LP,
LR, LS, LT, LW, LX, LY, LZ MA, MW, MX NA, NB, NE, NH, NL, NM, NP, NR, NS,
NW, NX, NY, NZ OA, OB, OE, OH, OK, OL, OM, OP, OR, OS, OX PA, PB, PC, PE,
PG, PH, PJ, PK, PL, PM, PN, PP, PR, PS, PT, PW, PX, PY RA, RB, RE, RH, RK,
RM, RP, RR, RS, RT, RW, RX, RY, RZ SA, SB, SC, SE, SG, SH, SJ, SK, SL, SM,
SN, SP, SR, SS, ST, SW, SX, SY ,SZ TA, TB, TE, TH, TK, TL, TM, TP, TR, TS,
TT, TW, TX, TY, TZ WA, WB, WE, WK, WL, WM, WP YA, YB, YE, YH, YK, YL, YM,
YP, YR, YS, YT, YW, YX, YY, YZ ZA, ZB, ZE, ZH, ZK, ZL, ZM, ZP, ZR, ZS, ZT,
ZW, ZX, ZY The characters D, F, I, Q, U
and V are not used as either the first or second letter of a National
Insurance Number prefix. Valid National Insurance Number
Suffixes: The final alpha of the NINO
should be A, B, C, or D.
There are occasions when the
validity of a VAT registration number is critical.
Particularly:
Supply to EU
trader If it appears that the VAT
number you have been given is incorrect, you should charge VAT rather than
exempt the supply. Purchase of goods/services from
registered One of the aspects that
qualifies a supply for a reclaim of input tax charged, is if the invoice
shows a valid VAT registration number. Although HMR&C have discretion
to allow a deduction even if the number is wrong, the discretion only
applies in certain circumstances. How to check a VAT registration
number. There are two ways to check the
validity of a VAT number: 1. Call HMR&C
0845-010-9000. Click here
for a call back from our office regarding this
article. |
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Self
Employed National Insurance - what do you get for your
money! |
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We are often asked to comment
on the types of state benefits you will not be able to claim if you are
self-employed and pay the basic Class 2, and the earnings related Class 4
contributions. Class 2 contributions will
qualify you for most of the benefits that an employed person can claim.
(Employed persons pay Class 1 contributions.) The two main exceptions are
earnings related state pension and contribution-based Jobseekers
allowance. If you are self-employed and
are unable to work due to illness you should be able to claim incapacity
benefit. However you may disqualify yourself if you make occasional visits
to your workplace. You may also have difficulties if you work from home,
proving that you do no work. Class 4 contributions do not
count towards any benefits. Retirement
pension
The number of years
contributions required to qualify you to a basic state retirement pension
is 30 years if you are due to reach retirement age on or after 6 April
2010. Click here
for a call back from our office regarding this
article. |
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Tax
Diary May/June 2008 |
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1 May
2008 - Due date for corporation tax
due for the year ended 31 July 2007. 19 May
2008 - PAYE and NIC deductions due
for month ended 5 May 2008. (If you pay your tax electronically the due
date is 22 May 2008) 19 May
2008 - Filing deadline for the
CIS300 monthly return for the month ended 5 May 2008.
19 May
2008 - CIS tax deducted for the
month ended 5 May 2008 is payable by today. 19 May
2008 - The payroll forms P35 and
P14s must be filed by this date - employers late in filing these forms may
receive a penalty. 31 May
2008 - Ensure all employees have
been given their P60s. 1 June
2008 - Due date for corporation tax
due for the year ended 31 August 2007. 19 June
2008 - PAYE and NIC deductions due
for month ended 5 June 2008. (If you pay your tax electronically the due
date is 22 June 2008) 19 June
2008 - Filing deadline for the
CIS300 monthly return for the month ended 5 June 2008.
19 June
2008 - CIS tax deducted for the
month ended 5 June 2008 is payable by today. Click here
for a call back from our office regarding this
article. |
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DISCLAIMER - PLEASE
NOTE: The ideas shared with you in
this email are intended to inform rather than advise. Taxpayers
circumstances do vary and if you feel that tax strategies we have outlined
may be beneficial it is important that you contact us before
implementation. If you do or do not take action as a result of reading
this newsletter, before receiving our written endorsement, we will accept
no responsibility for any financial loss
incurred. |
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Bates Weston Canal
Street DE1
2RJ Tel: 01332 365855 Fax:
01332 291294 web:
www.batesweston.co.uk BW Business Services Limited
t/a Bates Weston registered office The Mills, Directors: R J Carman FCA, R J
Smith FCA, I K Neal FCA CTA, G Evans FCA, W D Thomas
ACA Associate: M Morton
FCA Registered to carry on audit
work and regulated for a range of investment business activities by the
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