HMRC Is Shite

HMRC Is Shite
Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.

Wednesday, 13 October 2021

HMRC Has Ground To a Halt


 

HMRC is doing its best to destroy small businesses because of crippling delays, which have resulted in rebates going unpaid for months on end. 

HMRC is taking several months to process post and deal with issues that should take weeks under normal circumstances.

Taxpayers are missing out on large refunds, which has severely impacted businesses’ cash flows. Accountants said the tax authority had “ground to a halt”. 

Experts said the large numbers of HMRC staff working from home was likely to blame, as well as the clampdown on furlough fraud which they said had resulted in more taxpayer requests requiring additional verification.

Myelin Verboom of tax firm Mcas said one of her clients was still waiting on a six-figure payment. Her business could go bust if it did not receive the money soon, she warned.

“We have a property developer who bought a block of buildings, incurring a £250,000 VAT bill which was deductible. They have been trying to claim it back but the delays are so bad they have not even been able to register their business to pay the levy. 

There is a real risk these delays will end up pushing firms out of business because of the cash flow problems they are causing.”

Stuart Crofton of accountancy firm Stuart Crofton Tax said anything that required human intervention was taking longer than normal.

“I have one rebate of £50,000 still outstanding which we applied for in April. It is a massive loss for our clients. While HMRC will handover the paltry 0.5pc or so in interest the refund has accrued whilst it has sat in the tax office’s accounts, it pales when compared to the returns they could have enjoyed investing that money in the FTSE” .

HMRC aims to refund overpaid VAT within 30 days. However, its turnaround times have lengthened significantly since the start of the pandemic. 

Two thirds of letters addressed to HMRC went unanswered for more than two weeks in April and performance levels are still low, as the above chart shows. 

Lisa Styles of Hespera, another tax firm, said even simple tasks such as registering for self assessment were taking far longer than normal, meaning newly self-employed people faced being fined for late filing or tax payments next year.

If someone became self-employed last year and needed to register as self-employed to file their return and pay tax by January 31, the deadline to do this was October 5. But delays mean some are being told they will not be added to the system until March 2022, accountants said. 

Ms Styles said part of the backlog was down to a higher number of fraud checks than normal. HMRC has been tasked with recovering billions lost to fraudulent furlough claims. Higher numbers of staff are now working away from the office, after new rules allowing staff to work from home two days a week were introduced.

Self assessment services were also impacted after 5,000 staff were seconded to provide Covid-19 support during the crisis, although service levels in that department have since recovered to more normal levels, according to tax office sources. 

A spokesman for HMRC said: 

“We know there is more to do to improve turnaround on customer correspondence, and we expect to see further improvements as we emerge from the pandemic and continue to rebalance how we prioritise our resources.”

Tell that to the people whose livelihoods you have destroyed because of your delays!

Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Monday, 11 October 2021

HMRC Staff Return To The Office for One Day a Week


 

Public Technology reports that HMRC has begun its return to the office, although staff across the department will continue to work remotely for four days a week, on average.

In an all-staff memo sent last week, permanent secretary Jim Harra said more than 16,000 staff who had been working from home during the coronavirus pandemic had returned to offices by the end of September. They included 4,300 staff who had come into the office for the first time in the week leading up to the memo.

He said that by the end of last week, he expected “all colleagues in England and Scotland who have been temporarily working from home during the pandemic, will have agreed a plan with their line manager to return to the workplace for an average of one day a week, using the discussion toolkit”.

Those returning join around 4,000 HMRC staff who have been working from offices during the pandemic. Those civil servants are considered key workers and could not do their jobs remotely.

Staff in Wales and Northern Ireland should continue to work from home, he said.

I trust that in the coming weeks many of you will have the chance to re-connect face to face with your colleagues and enjoy a taste of office life again,” he said.

Harra said the expected one-day-a-week return “won’t be the same for everyone”.

Depending on your personal circumstances, you may need more support in making arrangements, so it’s really important that you talk to your manager about what is right for you,” he said. He said National Inclusion Week, which fell on the same week as his message, was a “real reminder to us all to continue to be respectful, kind and inclusive towards each other as more of us return to our offices”.  

The perm sec said he expected there will be “teething problems” as the number of staff working from HMRC’s buildings increases.

Please help your estates colleagues and location leads, who are doing an excellent job of coordinating all this for us, by reporting any issues that you see, and being patient as we move to our new arrangements,” he said.

The returns process and the toolkit Harra mentioned has been agreed with unions.

The PCS union has told its members they should only return if HMRC meets its agreed criteria to have a plan in place with their line manager, and if it is suitable for their individual circumstances.

PCS's advice is clear: the discussions between jobholders and managers must happen, so that any concerns about returning can be identified. Where it is not yet possible to establish a set date when you will start working in the office, you can continue to work from home; and you should agree with your manager when during the coming weeks, the situation will be reviewed,” the union said.

It added that union reps have “reiterated to the department that any attempt to force members back to the office would be unacceptable”.

For its part, HMRC has given a commitment to working with staff, to take reasonable steps to address their concerns and to support them to return. We’ve agreed with HMRC that any concerns arising from the agreed process and procedures will be escalated and resolved,” it added.

Harra’s email came the same week the coronavirus furlough, self-employment support scheme and sick pay rebate schemes came to an end.

I wanted to take a moment to say thank you to everyone for enabling the department to deliver these schemes so brilliantly, whether you have worked directly on the schemes or held the fort on our usual work,” Harra said.

He said civil servants’ “hard work and commitment” had helped to protect 11.6 million jobs and directly supported 2.9 million self-employed people across the UK.

I am deeply proud of your dedication and the huge scale of what we have been able to deliver together for individuals and businesses – so, thank you,” he added.


Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Monday, 4 October 2021

HMRC To Review The Pandora Papers



Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Thursday, 23 September 2021

MTD Delayed

Statement

The Government has set out an ambition to become one of the most digitally advanced tax authorities in the world.

Making Tax Digital (MTD) is the first phase of our move towards a modern, digital tax service fit for the 21st century. It supports businesses through their digitalisation journey and provides a digital service that many have come to expect in their everyday lives. MTD helps businesses reduce common errors in their tax affairs and allows for better customer interaction and guidance through digital prompts and nudges.

Since the introduction of MTD for VAT in 2019, over 1.5m businesses have joined and many are already experiencing benefits. MTD users are reporting that preparing and submitting returns is easier, and that MTD has increased their confidence in managing tax affairs and using technology. MTD also puts businesses on a path to further digitalisation: integrating tax management with a range of business processes can contribute to productivity gains.

During the pandemic, UK businesses increasingly turned to digital tools to communicate remotely and work collaboratively. Businesses adapted rapidly to the challenges posed by the pandemic, using digital solutions to maintain resilience and reduce disruption.

Over the past year, HMRC have worked closely with partners in the business and tax communities on the proposed design and scope of MTD for Income Tax (ITSA).

Today the Government has laid Regulations in Parliament to help those impacted by the changes to prepare, and for their representatives to develop their own support and guidance.

The Government recognises the challenges faced by many UK businesses and their representatives as the country emerges from the pandemic over the last year. In recognition of this and of stakeholder feedback, we will now be introducing MTD for ITSA a year later, in the tax year beginning in April 2024.

General partnerships will not be required to join MTD for ITSA until the tax year beginning in April 2025. The date at which all other types of partnerships will be required to join will be confirmed later.

In March 2021, the Government announced a new system of penalties for the late filing and late payment of tax for ITSA. This will now be introduced for those who are mandated for MTD for ITSA in the tax year beginning in April 2024, and for all other ITSA customers in the tax year beginning in April 2025.

Alongside the Regulations, HMRC have also today published a Tax Information and Impact Note (TIIN) setting out the projected benefit and cost impacts of MTD for ITSA, as well as a Policy Paper to help different businesses understand what their transition to MTD could look like in more detail.

A later start for MTD for ITSA provides more time for those required to join to make the necessary preparations and for HMRC to deliver the most robust service possible, affording additional time for testing in the pilot.

HMRC will continue to work in close partnership with business and accountancy representative bodies and software developers to ensure taxpayers are well supported as they adopt MTD for ITSA.

The Government has also recently consulted on a reform of the complex basis period rules that govern how self-employed profits are allocated to tax years. Many respondents said that the reform was a sensible simplification but asked for more time to implement the changes. In recognition of these concerns, these changes will not come into effect before April 2024, with a transition year not coming into effect earlier than 2023. The Government will respond to the consultation in due course providing the next steps.



Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"








Monday, 20 September 2021

Less Than 100 Days Until Christmas - Beware Customs Charges!

Tax and customs for goods sent from abroad

Skip to contents of guide

Tax and duty

You’ll be contacted by Royal Mail, Parcelforce or the courier company if you need to pay any VAT, duty or delivery charges (‘handling fees’) to receive your goods.

They’ll send you a bill stating exactly which fees you need to pay.

They’ll normally hold your parcel for about 3 weeks. If you have not paid the bill by then, your parcel will be returned to the sender.

You will not have to pay anything to the delivery company to receive goods worth less than £135 unless they’re gifts over £39 or excise goods (for example, alcohol and tobacco).

VAT

VAT is charged on all goods (except for gifts worth £39 or less) sent from:

  • outside the UK to Great Britain
  • outside the UK and the EU to Northern Ireland

VAT is not charged on goods that are gifts worth £39 or less.

You pay VAT when you buy the goods or to the delivery company before you receive them. If you have to pay VAT to the delivery company, it’s charged on the total package value, including:

  • the value of the goods
  • postage, packaging and insurance
  • any duty you owe

VAT is charged at the VAT rate that applies to your goods.

Goods worth £135 or less in total

If you bought the goods yourself and they are not excise goods, the seller will have included VAT in the total you paid.

You will need to pay VAT to the delivery company if the goods are:

  • gifts sent to you by someone else and worth more than £39
  • excise goods

Goods worth more than £135 in total

You will have to pay VAT to the delivery company either before the goods are delivered or when you collect them.

Customs Duty

You’ll be charged Customs Duty on all goods sent from outside the UK (or the UK and the EU if you’re in Northern Ireland) if they’re either:

  • excise goods
  • worth more than £135

If you’re charged Customs Duty, you’ll need to pay it on both:

  • the price paid for the goods
  • postage, packaging and insurance
Type and value of goods Customs Duty
Non-excise goods worth £135 or less No charge
Gifts above £135 and up to £630 2.5%, but rates are lower for some goods - call the helpline
Gifts above £630 and other goods above £135 The rate depends on the type of goods and where they came from - call the helpline

You pay Customs Duty on excise goods of any value.

Excise Duty

If you’re sent alcohol or tobacco from outside the UK, you’ll be charged Excise Duty at current rates.

If the goods are sent from the EU to Northern Ireland, check that the Excise Duty was included in the price. If it’s not, your goods may be seized.

It does not matter whether you buy the goods or they’re sent as a gift.

If you receive large amounts of alcohol or tobacco for your business, use the Trade Tariff to check duty rates.

Your goods can also be seized if they’re:

  • spirits over 35 centilitres without a UK duty stamp
  • cigarettes or hand-rolling tobacco without UK health warnings or fiscal marks

If you’re charged too much or return your goods

Ask for a refund of VAT or Customs Duty if you:

  • return your goods
  • think you’ve been charged too much

Download and fill in:

  • form BOR 286 if Royal Mail or Parcelforce delivered the goods
  • form C285 if a courier or freight company delivered the goods


Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Friday, 17 September 2021

The Plastic Packaging Tax - Not an April Fool's Joke!



Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday, 8 September 2021

The Health and Social Care Levy


 

Good luck to HMRC, tax advisors and tax agents implementing and dealing with the new Health and Social Care Levy.

At first this will be as a 1.25 percentage point increase in National Insurance.

From April 2023 National Insurance will return to its current rate, but a new health and social care tax will be introduced at a rate of 1.25% - making up for the change to National Insurance.

On wage slips it will appear as a "Health and Social Care Levy".

The levy - unlike National Insurance - will also be paid by pensioners who work.

People who earn under £9,564 don't have to pay National Insurance or the new levy.

Employers will pay more National Insurance - and the levy.

Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Friday, 3 September 2021

The Peasants Are Revolting - Taxpayers Call on HMRC To Stop and Think!

 



Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday, 1 September 2021

Back To School With HMRC

 

HMRC can help with childcare costs as children head back to school

Families may be eligible for Tax-Free Childcare to help pay for breakfast and after school clubs as children go back to school.

Families are eligible to save money on their childcare and benefit from a government top-up worth up to £2,000 every year, or up to £4,000 a year if a child is disabled. In June 2021, about 308,000 families across the UK benefited from using Tax-Free Childcare, but thousands are missing out on this opportunity.

Tax-Free Childcare is available to eligible parents or carers who have children aged up to 11, or 17 if their child is disabled. For every £8 a parent or carer deposits into their account, they will receive a £2 top-up, up to the value of £500 every three months, or £1,000 if their child is disabled. Parents and carers can check their eligibility and register for Tax-Free Childcare via GOV.UK.

HMRC recognises that families’ personal circumstances have changed since March 2020 as more parents and carers are preparing to return to their workplaces. The 20% top-up is paid into the child’s Tax-Free Childcare account and is ready to use almost instantly, meaning parents and carers can use the money towards the cost of childminders, breakfast and after school clubs, and approved play schemes.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

“As your children head back to school this autumn, don’t miss out on the opportunity to receive your 20% top-up to help pay for their childcare.

“It is quick and easy to sign-up, just search ‘tax-free childcare’ on GOV.UK.”

Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders or other accredited childcare providers. Parents and carers, who are returning to work after parental leave, can apply for a Tax-Free Childcare account for that child before they need to start using it. Families can start depositing money 31 days before they return to work, maximising the potential government top-up saving.

Childcare providers can also sign up for a childcare provider account via GOV.UK to receive payments from parents and carers via the scheme.

Notes to Editors

  1. Visit GOV.UK for further information on Tax-Free Childcare
  2. Latest Tax-Free Childcare statistics were released on 18 August 2021. Data is available up to 30 June 2021.
  3. Each eligible child requires their own Tax-Free Childcare account. If families have more than one eligible child, they will need to register an account for each child. The 20% government top-up is then applied to deposits made for each child, not household.
  4. Account holders must confirm their details are up to date every three months to continue receiving the government top-up.
  5. Follow HMRC’s Press Office on Twitter @HMRCpressoffice

Related links


Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday, 25 August 2021

HMRC's Unprintable Form - Fuckwittery of The Highest Order!


 



Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday, 24 August 2021

HMRC Taxes HM Courts and Tribunal Services


 

HMRC have slapped HM Courts and Tribunals Service with a £12.5m tax bill

The department was hit with the bill by HMRC in relation to incorrect assessments of workers’ employment status (IR35 rears its ugly head again!), according to its annual report for 2020/21.

In 2019, the Ministry of Justice was told to revisit employment status determinations made between April 2017 and April 2020.

The tax liabilities related to undisclosed number of workers who were previously concluded as operating outside of the off-payroll working rules by HMRC’s Check Employment Status for Tax (CEST) tool.

On the plus side, HMCTS won't end up paying the bill, the ultimate liability rests with us the taxpayers!

Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

You have the peace of mind knowing that your accountant's (your tax return agent) fees will be paid by the insurance without any Excess for you to find.

Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:

  • Deal with any correspondence from HMRC
  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday, 18 August 2021

HMRC is "Shambolic"


HMRC missed the deadline to appeal locum doctor George Mantides’ partial IR35 case victory, according to an Upper Tier Tribunal (UTT) judgement published last week.

It stated that HMRC had “sought permission” to appeal against a First Tier Tribunal (FTT) decision in 2019 that found the services Mantides provided Medway Maritime Hospital in 2013 fell outside IR35. 

However, its application was “submitted late and the FTT declined to grant an extension of time.”

“A further application by HMRC to this tribunal [UTT] was refused both on the papers and subsequently following an oral hearing,”

Seb Maley, CEO at Qdos (IR35 specialist), said:  

“That HMRC missed the deadline to appeal the contract Mantides held with Medway Maritime Hospital [MMH] tells you everything you need to know about the efficiency of the tax office. 

Not only does HMRC regularly struggle to identify if a contract belongs inside or outside IR35, but they aren’t organised enough to lodge an application to appeal despite it being something as significant as an Upper Tier Tribunal. It’s shambolic.”

While HMRC were due to appeal the MMH verdict, Mantides appealed an FTT ruling which found his services to Royal Berkshire Hospital (RBH), provided via his limited company – George Mantides Ltd – were inside IR35 and therefore liable for Income Tax and National Insurance contributions.

The UTT found that there was not sufficient evidence for the FTT to come to its conclusion that Mantides’ contract with RBH fell inside IR35. 

The judgement said that the UTT was satisfied there “there was nothing in the evidence to support the FTT’s conclusion as to the notice period and the obligation on RBH to provide work to Mr Mantides.”

However, it has delayed reaching a verdict, citing it is waiting for the outcome of another tax case recently heard by the Court of Appeal – PGMOL vs HMRC.

Tax does have to be taxing.

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Tuesday, 17 August 2021

HMRC Reveals Absurd Excuses for Not Paying National Minimum Wage



While the vast majority of employers pay their employees at least the National Minimum Wage, HM Revenue and Customs (HMRC) has today released some of the most absurd excuses used for not paying the legal minimum.

Last year (2020 to 2021) HMRC helped more than 155,000 workers across the UK recover more than £16 million in pay which was due to them, and also issued more than £14 million in penalties.

Some of the most ridiculous excuses for flouting the law included:

  1. “She does not deserve the National Minimum Wage because she only makes the teas and sweeps the floors.”
  2. “The employee was not a good worker, so I did not think they deserved to be paid the National Minimum Wage.”
  3. “My accountant and I speak a different language – he does not understand me, and that is why he does not pay my workers the correct wages.”
  4. “My employee is still learning so they are not entitled to the National Minimum Wage.”
  5. “It is part of UK culture not to pay young workers for the first three months as they have to prove their ‘worth’ first.”
  6. “The National Minimum Wage does not apply to my business.”
  7. “I have got an agreement with my workers that I will not pay them the National Minimum Wage; they understand, and they even signed a contract to this effect.”
  8. “I thought it was okay to pay young workers below the National Minimum Wage as they are not British and therefore do not have the right to be paid it.”
  9. “My workers like to think of themselves as being self-employed and the National Minimum Wage does not apply to people who work for themselves.”
  10. “My workers are often just on standby when there are no customers in the shop; I only pay them for when they are actually serving someone.”

Steve Timewell, Director Individuals and Small Business Compliance, HMRC, said:

“The majority of UK employers pay their workers at least the National Minimum Wage, but this list shows some of the excuses provided to our enforcement officers by less scrupulous businesses. Being underpaid is no joke for workers, so we always apply the law and take action. Workers cannot be asked or told to sign-away their rights.

“We are making sure that workers are being paid what they are entitled to and, as the economy reopens, reminding employers of the rules and the help that is available to them.

“HMRC reviews every complaint made about the minimum wage, so if you think you are being short-changed, or are a business that is unsure of the rules or needs help to get things right, get in touch and we will help you. But any employer deliberately or unapologetically underpaying their staff will face hefty fines and other enforcement action.”

The National Minimum Wage hourly rates are currently:

  • £8.91 - Age 23 or over (National Living Wage)
  • £8.36 - Age 21 to 22
  • £6.56 - Age 18 to 20
  • £4.62 - Age under 18
  • £4.30 - Apprentice.

HMRC is reminding workers to check the hourly rate of pay they are actually getting, and to also check any deductions or unpaid working time, as part of the Government’s commitment to build back fairer from the pandemic.

Anyone not being paid what they are entitled to can complain online at https://www.gov.uk/minimum-wage-complaint. If they want to speak with someone, in confidence, they should phone the Acas Pay and Work Rights Helpline on 0300 123 1100, who can transfer the call to HMRC.

Employers can also contact the Acas Helpline for free help and advice or visit https://www.gov.uk/guidance/calculating-the-minimum-wage to find out more.

Ironically these excuses look rather similar to the ones in the 2017 HMRC Press Release!


Tax does have to be taxing.

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Thursday, 5 August 2021

Government Fails IR35 Test


 

It seems that two government departments have fallen foul of HMRC’s “Orwellian” contractor taxation rules concerning off-payroll worker status (aka IR35), leaving them with bills topping £100m.

The Department of Work and Pensions (DWP) first made the admission in its 2020-21 annual report that it had used HMRC’s Check Employment Status Tool (CEST) to assess engaged off-payroll workers’ employment status or “correct tax treatment”.

It owes HMRC £88m for “historic errors” in assessing tax liability for its off-payroll workers over the period 2017-21.

Squirrelled away under “Fruitless payments” in the report, the note said: 

“In March 2020 DWP received a Letter of Offer from HMRC that formally concluded their review of IR35 implementation in DWP. The result was agreement on historic errors and acceptance by DWP of a liability for tax/NI [National Insurance] plus interest for the financial years 2017-18 (£21.1m), 2018-19 (£36.7m) and 2019-20 (£29.7m). A liability for 2020-21 (£0.4m) was also subsequently agreed.”

Days later, the Home Office quietly published its own annual report with a similar admission it had botched assessments of its contractors’ employment and tax status between 2017 and 2021.

It admitted being “careless” in its application of the off-payroll rules, and was penalised £4m along with a £29.5m bill for incorrect assessments plus interest on the accrued amounts.

Clearly the government doesn't understand how IR35 rules work. If the government does not understand its own rules, how the hell are the rest of us meant to understand them?

Tax does have to be taxing.

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Tuesday, 3 August 2021

Proposals to Clamp Down on Promoters of Tax Avoidance

Published 20 July 2021

Who is likely to be affected

The measure will affect promoters and enablers of tax avoidance schemes.

The proposals supporting customers to identify and exit avoidance will benefit taxpayers.

General description of the measure

The measure is targeted at the most persistent and determined promoters and enablers of tax avoidance.

The proposed legislative changes are designed to clamp down on the supply of tax avoidance arrangements and include:

  • a new power for HMRC to seek freezing orders that would prevent promoters from dissipating or hiding their assets before paying the penalties that are charged as a result of them breaching their obligations under the anti-avoidance regimes
  • new rules that would enable HMRC to make a UK entity, who facilitates the promotion of tax avoidance by offshore promoters, subject to a significant additional penalty
  • a new power to enable HMRC to present winding-up petitions to the Court for companies operating against the public interest
  • new legislation that would enable HMRC to name promoters, details of the way they promote tax avoidance, and the schemes they promote, at the earliest possible stage, to warn taxpayers of the risks and help those already involved to get out of avoidance

Proposed revisions

Freezing Orders for promoters where there is a risk they will hide or dissipate assets

The proposed changes would enable HMRC to seek a freezing order where they are about to commence proceedings for a tribunal assessed penalty under current anti-avoidance legislation. For instance, where HMRC are about to make an application for a tribunal assessed DOTAS penalty.

The legislation would make it clear that this would satisfy the requirement for an existing cause of action, allowing HMRC to use this position to apply for a freezing order. HMRC would still need to show that it was appropriate for a freezing order to be granted.

Penalty on UK entities who facilitate tax avoidance schemes provided by an offshore promoter

The conditions, all of which must apply, under which the additional penalty may be charged are that:

a) The UK entity falls within the definition of a member of a ‘promotion structure’ (as introduced in Schedule 30 Para 10 Finance Act 2021).

b) A penalty or penalties under anti-avoidance legislation becomes due and payable on the UK entity in respect of their own activities.

c) The activities giving rise to the penalty or penalties under anti-avoidance legislation were undertaken within an offshore promoter structure.

d) The total value of the penalty or penalties under POTAS, DOTAS or DASVOIT legislation is equal to, or greater than, £100,000.00.

A penalty may also be charged where conditions a, b and c above are met and the UK entity is subject to an Enablers penalty under Section 16 Finance (No.2) Act 2017. The £100,000 threshold in this instance is not applicable.

The additional penalty for facilitating an offshore promoter’s business would be for an amount up to the total fees or amounts economically equivalent to fees earned by all those involved in the development and sale of that tax avoidance scheme.

Where it was not possible to determine the value of those fees, a best reasonable estimate would be used. There is also provision in the draft legislation for the additional penalty to be increased or for a new penalty assessment to be raised where further fees come to light at a later date.

Winding up companies that promote tax avoidance

The proposed new power to be included in the Finance Bill will enable HMRC to present a winding-up petition to the Court for companies who are operating against the public interest whether there is a debt or not.

The new HMRC power will mirror the approach that currently exists in the Insolvency Act 1986 by using any information acquired in connection with the Commissioners’ functions under section 5(1) of CRCA as a basis for considering winding-up action against a company.

Supporting taxpayers to identify, steer clear of and exit tax avoidance

This proposed power will allow HMRC to share information about promoters of tax avoidance and tax avoidance schemes earlier than it currently can or will be able to under the recently amended provisions in Finance Act 2021.

The proposed power would enable HMRC to name a particular scheme, its arrangements and how it is being made available to taxpayers or administered, from when HMRC first learns about it. The power will enable the naming of those associated with the entity carrying out the promoting activity by means of control or influence as well as any persons that carry out a role in selling the scheme to taxpayers.

The new power would also enable HMRC to publish any other information or documents relating to the arrangement, entities or individuals which HMRC reasonably believe will ensure that members of the public can identify the arrangements and understand them and the risks which attach to them.

The proposed changes would require HMRC to provide a 30-day period to those entities or individuals after HMRC have given them notice that they intend to name to allow them an opportunity to make representations as to why they should not be named. A final decision on whether to publish information would be made by an Authorised Officer.

 

A Data Protection Impact Assessment will be completed before the measures are implemented.

Tax does have to be taxing.

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  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

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Monday, 2 August 2021

IRONY KLAXON - Tax Meat Says Boss of Plant-Based Meat Company


 

The founder of the world's biggest plant-based meat firm says a tax on meat could get people to cut their consumption of animal-based products.

Beyond Meat boss Ethan Brown told the BBC he is in favour of a "pigouvian tax" on activities that create adverse side effects for society.


Tax does have to be taxing.

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A Solar Protect policy will enable your Accountant (your tax return agent) to:
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  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday, 27 July 2021

Kopparberg Sues HMRC


 

Swedish cider maker Kopparberg has filed a High Court claim against HMRC over allegations of unlawful tax discrimination.

Kopparberg argues that the UK applied excessive duties on imported alcoholic ciders by allowing domestic producers to dilute their products to avoid taxes.

The tax loophole, known as post duty point dilution (PDPD), allows UK-based producers of flavoured wines and ciders to pay duty only on high strength wine concentrates imported to Britain, rather than on the finished product.

Kopparberg, which until recently imported all its drinks from its brewery in Sweden, accuses the government of knowingly providing the loophole in a way that unfairly reduced its own profits.

In papers lodged at the High Court, seen by the Financial Times, argued the tax rules gave an “unfair and unlawful advantage” to UK-based producers because it breached EU state aid rules that require all companies to be treated equally.

Industry experts told the newspaper that if Kopparberg won its case it could open the floodgates to a tide of similar claims from other importers of alcoholic drinks, including top supermarket chains.

The practice of PDPD was banned for beer in 1993 and for pure cider in 2001, but remained in place for mixed products such as flavoured ciders and alcopops.

HMRC finally closed the loophole in April last year following a warning by the European Commission in 2017 that the practice broke EU state aid rules.

Lawyers for HMRC argued that the tax regime was not discriminatory to EU companies such as Kopparberg because nothing was preventing them from setting up in the UK and taking advantage of the same loophole.

“The claim that PDPD conferred an economic or selective advantage on domestic producers . . . depends on the claim that the claimants and other importers could not readily have used PDPD,”

Tax does have to be taxing.

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A Solar Protect policy will enable your Accountant (your tax return agent) to:
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  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
  • Having the security of knowing that fees will be met in full will enable your Accountant (your tax return agent) to defend your position robustly

Please click here for details.

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Wednesday, 21 July 2021

HMRC's Abysmal Performance - Targets Last Met 2018


 

It is the flavour of the month for businesses and the civil service to blame their failings on Covid.

However, as HMRC's performance stats show, its performance has been shite for longer than Covid.

The speed of calls answered on the Covid helpline was a stark contrast to the agent dedicated line, where the average speed of answer was 12:04 minutes in 2020/21, and agents faced further heartache when the line was withdrawn in March 2020. 

The average call waiting times throughout the past year were outlined as:

  • 17:34 minutes during March 2021
  • 15:23 minutes during quarter 4
  • 12:04 minutes over the whole financial year

As per the ICAEW Tax Faculty:

“The last time that HMRC met its targets of average call waiting time of less than five minutes and no more than 15% of callers waiting for more than 10 minutes was 2017/18, which suggests that there are fundamental problems.”

Tax does have to be taxing.

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Wednesday, 14 July 2021

Poll Favours Change in Tax Year End


 



Tax does have to be taxing.

Tax Investigation Insurance

Having a Solar Protect Tax Investigation Insurance policy at your disposal means that should you be one of the many 1000's of businesses or individuals that are selected by HMRC each year to look into your tax affairs your own accountant (your tax return agent) can get on and defend you robustly.

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Tax Investigation Insurance is an insurance policy that will fully reimburse your accountants (your tax return agent) fees up to £100,000 if you are subject to enquiry by or dispute with HMRC.

A Solar Protect policy will enable your Accountant (your tax return agent) to:
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  • Attend any meeting with HMRC
  • Appeal to the First-tier Tribunal or Upper Tribunal
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Please click here for details.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"