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Say ‘I do’ to Marriage Allowance this Valentine’s Day

HM Revenue and Customs (HMRC) is sharing the love this Valentine’s Day and encouraging married couples and those in a civil partnership to sign up for Marriage Allowance.

More than 3.5 million couples are already benefitting from Marriage Allowance, which was introduced in April 2015, but HMRC estimates around 700,000 couples are still eligible for the free tax break worth up to £238 this year. If their claim is backdated, they could receive a lump-sum of up to £900.

Financial Secretary to the Treasury, Mel Stride, said:

“For more than 3.5 million married couples and those in a civil partnership, we are putting up to £238 this year back into their wallets, and it is encouraging to see so many people taking advantage of the tax relief.

“Married couples who are yet to sign up for this great scheme – you too can benefit – it is quick to register and any back-dated allowances will be paid as a lump-sum.”

Marriage Allowance lets lower income workers transfer £1,190 of their Personal Allowance to their husband, wife or civil partner – if their income is higher. This reduces their tax by up to £238 for 2018/19 tax year.

Customers can benefit from Marriage Allowance if all the following apply:

  • you’re married or in a civil partnership
  • you do not pay income tax or your income is below your Personal Allowance (usually £11,850)
  • your partner pays income tax at the basic rate, which usually means their income is between £11,851 and £46,350

The personal tax allowance is increasing to £12,500 in April 2019. The increase in non-taxable earnings means eligible couples will be able to transfer up to £1,250 from the lower income to the higher income earner – reducing their tax by up to £250 a year.

Couples can find out more and apply for Marriage Allowance at GOV.UK. Couples are guaranteed 100% of their eligible entitlement, if they apply directly through HMRC. There is no need to reapply for Marriage Allowance every year because it is automatically renewed. However, couples should notify HMRC if their circumstances change and they want to cancel it.

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1,773 happy returns at Christmas

HM Revenue and Customs (HMRC) received 1,773 online tax returns on Christmas Day – a 13 per cent increase on last year’s total of 1,566.

HMRC’s Christmas data logs reveal the busiest time for online returns on 25 December was between midday and 1pm, when 148 Yuletide returns were delivered electronically.

Christmas Eve, traditionally a much busier day for festive filing than the big day itself, saw 17,644online returns successfully submitted. This was up 4 per cent on the 17,000 received on 24 December 2013.

Another 4,811 online returns ticked all the boxes on Boxing Day – a 7 per cent increase on the 4,493 received last year.

In total, 24,228 online returns were received over the three-day festive period – up 5 per cent on the 2013 total of 23,059.

HMRC Director General of Personal Tax, Ruth Owen, said:

“You can file your online return at any time of day or night – even Christmas Day, if it suits you. But don’t leave it too late. Give yourself plenty of time to resolve any problems and if you need to call us, do it now, as our phone lines get much busier as the 31 January deadline approaches.”

The deadline for sending 2013/14 tax returns to HMRC, and paying any tax owed, is 31 January 2015.

All outstanding 2013/14 tax returns must now be submitted online, as the 31 October paper-filing deadline has passed.

For help with your tax return, contacts Davenports today on Faringdon 01367 602011 or Swindon 01793 230472

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HMRC turns attention to horsebox owners in evasion clampdown

Horsebox owners dishonestly claiming horseboxes worth hundreds of thousands of pounds as company expenses are set to be the subject of HM Revenue & Customs investigation, as it continues its clampdown on tax evasion.

Top 50 firm UHY Hacker Young believes HMRC suspects some farmers and rural business owners of buying horseboxes through their company, either falsely claiming the cost as a business expense for tax purposes, or failing to declare personal use of the horsebox and paying tax on it as a “benefit in kind”.

Horseboxes can be valuable assets, with the one used by Zara Phillips at the 2012 Olympics valued at around £500,000 – albeit complete with capacity for six horses and its own bedroom, kitchen and living room complete with satellite television. There is no suggestion that Phillips has evaded tax.

HMRC officials can now identify connections and discrepancies between an individual or company’s official tax records and information from multiple third party sources via the department’s computer system, Connect.
UHY Hacker Young says that HMRC uses DVLA databases, and even Google Streetview, to monitor the lifestyle of suspected tax evaders.

UHY Hacker Young partner Charles Homan said: “Underpaid tax relating to horseboxes is a drop in the ocean but HMRC seems to be focussing attention in this area because they can now be such valuable assets.”
“It shows how determined HMRC are to close down every little loophole and capture every mistake made in tax returns. Without the correct documentation, even owners of horseboxes who have done nothing wrong could find themselves on the receiving end of a lengthy and uncomfortable tax investigation.”

Story from Accountancy Age

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EU VAT CHANGES FOR 2015

There are two new directives, first for the fast reaction mechanism aimed towards preventing VAT fraud. Second one is for the optional and temporary application of the reverse charge mechanism in relation to supplies of certain goods and services. Quick Reaction mechanism provides the legal basis to the countries that are members of the EU to integrate an emergency measure in they are in position to serious case of sudden and massive VAT fraud.

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FUNDAMENTAL ACCOUNTING

Financial statements are prepared according to agreed upon guidelines. In order to understand these guidelines, it helps to understand the objectives of financial reporting. The objectives of financial reporting, as discussed in the Financial Accounting standards Board (FASB) Statement of Financial Accounting Concepts No. 1, are to provide information that

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SAVE ON TAXES

Value Added Tax (VAT) is a tax on consumption levied in the United Kingdom by the National Government. It was introduced in 1973 and is the third largest source of government revenue after Income Tax and National Insurance. It is administered and collected by HM revenue and customs, primarily through the Value Added Tax Act 1994. VAT is levied on most goods and services provided by registered businesses in the UK and some goods and services imported from outside the European Union.

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Solicitors targeted in new tax clampdown

Solicitors are being given the chance by HM Revenue and Customs (HMRC) to bring their tax affairs up to date or face tougher penalties, as part of a new tax campaign.

The Solicitors’ Tax Campaign is the latest voluntary, intelligence-led disclosure opportunity giving specific groups of taxpayers the chance to get their tax affairs in order on the best terms available.

Previous campaigns have included medical professionals, plumbers, tutors and coaches, electricians, online traders, landlords and health professionals. This approach has so far raised almost £1 billion from voluntary disclosures and follow-up activity by HMRC.

Solicitors have until 9 March 2015 to tell HMRC that they would like to take part in the campaign, and until 9 June 2015 to disclose the tax they owe and pay it.

By using this campaign to come forward voluntarily, any penalties they might have to pay will be lower than if HMRC has to approach them first.

Caroline Addison, Head of Campaigns, HMRC, said:

“Information gathered by HMRC has allowed us to identify solicitors who thought they could operate without declaring income and paying the taxes that others have to pay.

“If you have not declared all of your income, you need to put your tax affairs in order. Take this chance to come forward and put things right in a straightforward way and on the best possible terms. It will be easier and cheaper for you to come to us than for us to come to you.

“Those who make a deliberate decision not to pay the taxes due could face a penalty of 100% or more of the tax due, or even a criminal prosecution.”

Solicitors can take part in the Solicitors’ Tax Campaign by:

  • Telling HMRC they want to take part in the campaign by 9 March 2015
  • Disclosing details and paying what they owe by 9 June 2015

For more details, plus help and support on the campaign, solicitors can phone a dedicated helpline on 0300 013 4749 or visit www.gov.uk/solicitors-tax-campaign online.

For independent help and support contact Davenports Accountancy today on 01367 602011

 

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PROPER INVOICE INFO

Financial statements are prepared according to agreed upon guidelines. In order to understand these guidelines, it helps to understand the objectives of financial reporting. The objectives of financial reporting, as discussed in the Financial Accounting standards Board (FASB) Statement of Financial Accounting Concepts No. 1, are to provide information that

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PROPER INVOICE INFO

Financial statements are prepared according to agreed upon guidelines. In order to understand these guidelines, it helps to understand the objectives of financial reporting. The objectives of financial reporting, as discussed in the Financial Accounting standards Board (FASB) Statement of Financial Accounting Concepts No. 1, are to provide information that

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Digital services suppliers urged to register for new EU VAT service

Businesses supplying digital services across the European Union will be able to register for a new online VAT service from 20 October.

This will mean that they do not have to register VAT separately in each country where they do business.

To help the estimated 34,000 or so small-to-medium-sized enterprises (SMEs) affected by the changes, HM Revenue and Customs (HMRC) has released a short YouTube video: http://youtu.be/cZdDIVNaL18

The digital services affected include most types of broadcasting, telecommunications and e-service supplies. Examples range from telephone services, supplies of music, films and games to downloads of apps, images, text or other information.

From 1 January 2015 the place of supply, and therefore taxation, of EU business-to-consumer supplies of digital services is changing. Currently the place of taxation is where the supplier is established, but from January it will be where the consumer lives.

On 1 January all EU Member States will also implement the VAT Mini One Stop Shop (VAT MOSS), to avoid additional administrative burdens and costs if a business is required to register for VAT in every Member State where it has consumers.

Sally Beggs, Deputy Director, Indirect Tax, HMRC, said:

“The VAT MOSS will save digital services suppliers from having to register for VAT in every Member State where they do business, removing a significant administrative burden. Businesses with their main operation or headquarters in the UK will register with HMRC to use the service.”

Between 27,000 and 42,000 UK businesses are expected to register for VAT MOSS in the UK.

While they will be able to register from 20 October 2014, the service will start operating from 1 January.

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