Get ready for payroll changes

Thomas Coombs is reminding clients that PAYE legislation is changing from 5 April 2016, so employers who intend to or are already payrolling benefits and expenses must register with HMRC using the new online Payrolling Benefits in Kind (PBIK) service. In addition, from next April, employers who use the service and already payroll benefits and expenses won’t have to report them on a P11D.

Employers must align their payroll software and register to payroll using the new service by 5 April 2016. They will not be able to register after this date for the 2016/2017 tax year as HMRC is unable to process changes in-year.

HMRC adds that all payroll benefits and expenses need to be included when employers report their payroll information in a Full Payment Submission (FPS). In addition, P11D (b) forms must still be completed, including the total benefits and expenses provided, whether or not they have been put through the payroll. However, if employers payroll car and fuel benefits, they must not complete P46 (Car) forms as they are deducting the tax at source that is due on these benefits.

Christopher Darwin, Partner at Thomas Coombs said: “All of these changes coming in from next April can be very confusing for an SME owner and so I would suggest that if you’re unsure about payroll changes, you seek professional advice. At Thomas Coombs, we can handle your payroll duties so that it is one less thing for you to worry about. Let PBIK be our headache, not yours!”

For more information please contact Christopher Darwin.

Stuart Adam, Thomas Coombs

Don’t be scared, you still have time to submit your paper tax return

As Halloween quickly approaches, most people may be worried about ghosts and ghouls, but Thomas Coombs is warning individuals to be more concerned about their paper self-assessment tax return.

The deadline for submission of this year’s annual paper tax return is midnight on 31 October and businesses and individuals who use this method must submit their return and all supporting evidence to HM Revenue & Customs (HMRC).

Any paper returns submitted after this date could leave a taxpayer liable to fines or investigation from HMRC.

Those that miss the paper deadline will have a second chance to return their documents in the form of an online tax return in the new year, using their unique taxpayer reference (UTR) provided by HMRC.

Stuart Adam, Partner at Thomas Coombs, said: “It is important that those who wish to return their self-assessment tax return in paper form do so before this month’s deadline.

“Submitting the return after this date could lead to a fine, even if you then complete an electronic return ahead of the online deadline of 31 January 2016.

“The government is currently in the process of developing a new online system that will do away with the traditional self-assessment return by 2020, but until then it is vital that businesses and individuals meet their annual tax return deadlines.”

For more information please contact Stuart Adam.

Do not bury your head in the sand

Leeds – based accountants Thomas Coombs is urging business not to be complacent if they receive accelerated payment notices (APNs), after new figures reveal that the government has collected more than £1 billion through their use.

HM Revenue & Customs (HMRC) recently announced that it has collected more than a billion pound using APNs, since it was granted the new powers in 2014/15.

Under the accelerated payment rules, HMRC is able to make taxpayers pay disputed tax in advance, rather than waiting for the outcome of a tax tribunal ruling.

Once an APN is received taxpayers have 90 days to pay the outstanding tax, whether they feel it is due or not or face additional penalties. If the taxpayer wins the case the money is reimbursed to them with interest.

During the first year HMRC issued more than 10,000 notices to businesses or individuals who had used a disclosable scheme under the Disclosure of Tax Avoidance Schemes (DOTAS) rules.

Andrew Cowe, Senior Tax Manager at Thomas Coombs, said: ““Receiving an APN should not be taken lightly, as it can have a serious effect on the liquidity and reputation of you and your business.

“The fact that HMRC have collected more than £1 billion, shows that they are serious when it comes to potential tax avoidance.”

Earlier this year, it was revealed in HMRC’s annual report on tax avoidance, that of the £596m received from APNs during 2014/15, some £28m was refunded after legal challenges.

“While many of those targeted by these new powers may have legitimately avoided paying tax, there will be some individuals and business who have been unfairly targeted and this is evident in the number of refunds already issued by HMRC,” added Andrew Cowe. “Seeking professional advice sooner rather than later is critical.”

For more information please contact Andrew Cowe, Senior Tax Manager