The idea of the scheme is to make it easier for people to work from home – especially with the Olympics coming up this summer, and after the bad winters we have had the past couple of years; and to make any business travel economic and environmentally friendly wherever possible. This can include things from software and hardware to allow employees to work from home, to installing a new shower facility in your office so staff can cycle to work and shower when they get there instead of driving every day.

For more information on ideas or how to apply, please visit the Sustainable Routes website here
http://www.sustainableroutes.co.uk/

Following on from this Morgan Harris decided to look into using Skype (alanmorganmhg) as a way of reaching clients who cannot afford the time or travel to meet us in Witney, this then allows us to have the same face to face meeting we pride ourselves on but without the extra travel time involved.

For more information on how this can benefit your business, or how to contact us on Skype, please contact at Morgan Harris.

The 2012 budget announced that child benefit will be progressively withdrawn from households where someone earns at least £50,000 (If both parents are earning £49,000 each they will still be entitled to receive full child benefit). The benefit will be withdrawn at the rate of 1% for every £100 above the threshold. This means that anyone earning over £60,000 per annum will get no child benefit.

The withdrawal of benefit is to be by a new tax charge called “high income child benefit charge” This will be charged on the higher earner. In a full tax year, for a parent with two children, this would lead to an additional tax liability of £1,349. The scheme does not start until 7 January 2013, which means that the maximum tax charge for the 2012/2013 tax year would be £337.

It is possible for an election to be made so that child benefit is not received in the first place. In such cases there will not be a high income child benefit charge. The right to make this election rests solely with the person who receives the child benefit.

It is the duty of the person who is liable to pay the charge to notify HM Revenue & Customs. There will be penalties imposed for those who do not inform HM Revenue & Customs.

If you would like to discuss any aspect of the above, please contact at Morgan Harris.

Some of the regulations which have come into force on 6 April 2012 are as follows:

1) Qualifying period for unfair dismissal is extended from one years employment to two.
2) A new apprenticeships agreement in England and Wales will allow checks to be made on the employment status of apprentices.
3) Contracting out for defined contribution schemes will be abolished.
4) The period when an injury to a person at work must be reported will be extended from over three days to over seven days
5) Business will have the right to install cetain types of microgeneration technologies in non-domestic premises without the need for planning permission.
6) It will no longer be legal to display tobacco products in shops, though business with less than 10 employees will have until April 2015 to comply.

To discuss any of these further please contact at Morgan Harris

If your only source of income is from your salary and you do not receive any taxable benefits in kind, then your tax code for the 2012/2013 tax year applied to your salary should 810L.

If you are not sure if you are on the correct tax code, please contact your who will be able to help you to check if it is correct.

The problem has been further compounded by the lack of clarity in the filing system itself. The initial receipt message suggested that a successful return had been made and many employers were unaware that the initial transmission was simply a ‘test’ return and that they needed to file again in ‘live’ mode.

In addition, some penalty notices have been sent out to employers where no return was actually due. Note that, even if a business has an existing PAYE scheme, a P35 return is only due if there are taxable or NICable earnings to be recorded on forms P14. There is no requirement to submit a ‘nil’ return. However HMRC will assume a return is due if they hold a live PAYE scheme and they have not been notified otherwise. It is therefore very important that employers notify HMRC that no return is due, to prevent the H M Revenue & Customs computer process issuing an automatic penalty notice.  There is a facility to notify HMRC online.

As a consequence of these problems with the system, HMRC has lost a number of appeal cases, notably that of HOK v HMRC, where tribunal chairman Judge Geraint Jones accused HMRC of using the penalties as a revenue-generation source rather than a genuine attempt to police the deadline.

To prevent a recurrence of the debacle, HMRC issued a statement on 19th March 2012. To help employers comply with their obligations, HMRC will:-

• change the date when they issue the ‘Notification to complete form P35 Employer Annual Return 2011-12′ from mid-February to mid- March 2012, so that employers will receive it much nearer to the end of the tax year

• from 28 April 2012, where HMRC believes a 2011-12 P35 remains outstanding, they will issue an ‘Employer Annual Return Reminder’

• from 31 May 2012, HMRC will introduce a ‘P35 Interim Penalty Letter’ which will be issued over a five day period, so that it reaches employers within a month of the filing deadline. The letter will state that the employer has incurred a late return penalty and explain what to do to avoid it increasing. HMRC has worked together with the professional bodies on the content of this letter and it has been tested on employers and payroll agents to make it clear and employer-focussed.

HMRC will also:-

• improve the online guidance for submitting P35s online, including specific advice about the test-in-live service to reduce the number of employers who believe their test submission is the live submission. The on-screen messages within the HMRC online product will also make it much clearer that, even when a successful test transmission has been made, a live transmission is still required. We would encourage those using commercial payroll software (where the text of test /live messages may vary) to sign up for HMRC’s email alert facility to help them avoid this problem.

• instruct Employer Helpline staff to tell employers about filing dates when setting up new employer schemes, to help them avoid a penalty

• for 2012/13, improve the information on the P35 and the reminders to include a warning that the first penalty notice will cover four months.

Taken together, these measures should help employers to avoid incurring unnecessary penalties and significantly reduce the number of cases where penalties in excess of £100 are charged.

For further advice on this issue, please contact at Morgan Harris.

As those of you in the construction industry know all employers have to complete a CITB Levy Return each year following 5 April.

The levy is payable at rates detailed below:-

0.5% on Gross Pay paid to employees
1.5% on Payments made to subcontractors for labour only work

However relief is available if you receive payments from a subcontractor for labour only work.

In other words if you receive more from a contractor than you pay out to employees and subcontractors then you won’t have to pay the levy!

Even if you don’t pay the levy you may still be entitled to grants towards training employees or subcontractors. Please visit CITB Skills for more details.

If you need any assistance completing this form, please do not hesitate to contact at Morgan Harris.

For those of you that prepare your payroll using H M Revenue & Customs Basic PAYE Tools. The update to Basic PAYE Tools for the year 2012/13 is now available. This will allow you to complete your end of year return P35 and P60s and also allow you to start to process your payroll in the new tax year.

Please click on the link below which will take you to H M Revenue & Customs website and select the relevant version for your computer.

H M Revenue & Customs

Once you have successfully downloaded, you will need to follow the onscreen instructions to transfer across your employer database from 2011/12 Basic Payroll Tools.

Please be aware that the download can be slow at busy times so have a little patience it will get there in the end.

If you need any assistance with this or any other payroll problem please do not hesitate to contact your at Morgan Harris.

H M Revenue & Customs expect the practical effect to be limited because in many cases employers have either assumed that Smart Phones were mobile phones or that they were covered by the exemption.  However, if you have included the cost of a Smart Phone on a form P11D for any year from 2008 to 2011, you may now claim a repayment of the relevant class 1a national insurance contributions.  Repayments for 2007/08 will need to reclaimed before 31 July 2012.

If you require any further information regarding the above, please contact at Morgan Harris.

Although George Osborne said that this year’s budget was intended to “unashamedly back business” I cannot see hardly anything that will benefit Small businesses. Whilst I can see why he wants to encourage large businesses to base themselves in the UK by reducing the main rate of Corporation Tax to 22% by 2014, it doesn’t benefit SME’s as the Small Company Corporation Tax rate will remain at 20%. This in no way gives any encouragement to those entrepreneurs at the coal face who take the biggest risks.

Although the basic Personal Allowance will increase to £9205 in April 2013, buried in the fine print of the Budget Red Book was news that the threshold for the 40p higher rate of tax was being cut. This will mean that whilst low earners will benefit, more people will pay 40% tax as a result of the reduced threshold.

We have uploaded to our website a summary of the 2012 Budget with all the key points and how it will effect you, to see this please click here.

As always if you have any questions regarding this please do not hesitate to contact us.

However, we have recently heard a story of a legitimate case of someone from the Revenue calling up for bank details, despite it clearly stating on their website that they will never contact you over the phone for personal details.

A company director had a call from a lady saying she was from HMRC and needed the company bank details so she could issue a tax refund. The director, quite sensibly, said no and that he would call back on the official tax number to give the details over that way. The lady then said that she was on a secondment and worked from home, meaning that no one at the tax office would have heard of her. The company director then called up the HMRC fraud team to report the story, however a little while later they called back to tell him the call was genuine.

Despite the Revenue doing what they say they won’t, and calling asking for personal details, you should never under any circumstances give out personal or bank details over the phone. Hang up and call your local tax office who will know if you are entitled to a refund and tell you how to claim it.

For more information on this please contact at Morgan Harris.