HLAS

HMRC has updated its guidance on tax treatment of tips, gratuities, service charges and troncs to include details on how to handle electronic payments. The payment of tips is commonplace for employees in the catering and service industries. As the pandemic has accelerated a move away from payment in cash, there has also been a shift towards customers paying tips electronically. The updated guidance for employers includes examples of systems for the electronic payment of tips. The guidance reflects that a payment made electronically does not change any of the basic principles for deciding how tax is to be accounted [...]

Grants of up to £3,000 are available to enable rural pub owners, licensees, and local communities to work together to help support and sustain local services in Wales, Scotland and England. Pub is the Hub’s Community Services Fund will assist projects which support the needs of local communities by using pubs to offer a new service or replace a service that has already been lost, such as a local shop, library, post office or community centre, or encouraging the local sourcing of products, providing school meals, IT training and church services. Funding will support projects where no other local funding [...]

All benefit claimants will be moved over to Universal Credit by the end of 2024, with moves from legacy schemes resuming next month, the Department for Work and Pensions announced last week. The restart follows a pause to the process during the pandemic when staff were focused on supporting the surge of new claimants to Universal Credit. The six benefits being replaced all have complex and inefficient systems based on aging, inflexible IT. Universal Credit uses a modern, digital system which stood up to the test of Covid-19 where it quickly ensured three million new claimants were protected from the [...]

About 2.1 million tax credits customers have begun to receive their annual renewal packs from HM Revenue and Customs (HMRC). The packs will be sent between 25 April and 27 May, and customers have until 31 July to check their details are correct and update HMRC if there has been a change in their circumstances. There are 2 types of renewal packs: if it has a red line across the first page and says, ‘reply now’, customers will need to confirm their circumstances to renew their tax credits if it has a black line across the first page and says, ‘check now’, [...]

With employees’ and directors’ P11d’s for 2021/22 due by 6 July 2022 it is timely to remind employers of the rules for travel and subsistence, particularly as HMRC have recently issued some updated guidance and useful examples of their interpretation of the law. Tax relief for employee travel costs is available provided the journey isn’t ordinary commuting or private travel. Thus, amounts paid by the employer would not be taxable. No relief is available for ordinary commuting, which is travel between home (or a place that is not a workplace) and a ‘permanent workplace’. There are a number of criteria [...]

The UK has announced new measures to support Ukraine in its conflict with Russia by removing all tariffs covered by the existing UK-Ukraine trade deal. The measures include: UK to cut tariffs on all goods from Ukraine to zero under the UK-Ukraine FTA, providing much-needed economic support. New export ban on products and technology that Russia could use to repress the people of Ukraine. Tariff measures are part of broad UK economic support to Ukraine, including £1bn in loan guarantees. See: UK announces new trade measures to support Ukraine - GOV.UK (www.gov.uk)

A new law will help UK firms do business while maintaining strong protections for consumers and will come into effect on 1 June 2022 the UK government has announced. Currently, the UK has retained EU rules that exempt businesses from competition law in certain circumstances. The UK government has received expert advice from the UK’s Competition and Markets Authority, which recommended a new, bespoke competition law exemption for the UK, replacing the retained EU rules, which expire on 31 May 2022. See: New law to make doing business simpler while protecting consumers - GOV.UK (www.gov.uk)

We are in a period of high inflation of prices for goods and services. The Office for National Statistics (ONS) shows one of the inflation indices has increased by 6.2% in the 12 months to March 2022. This is the highest that CPIH (Consumer Prices Index including owner occupiers' housing costs) has been since 1992. Among the main components of this increase are transport costs, such as petrol and diesel and the price of second-hand cars. The Government Actuary’s Department offer commentary on the reasons and recently stated that: “During the pandemic prices for some goods and services fell, such [...]

HMRC have been consulting on changes to the relief from stamp duty land tax (SDLT) when two or more properties are acquired at the same time. This indicates that a change in the rules is imminent, and purchasers should take advantage while the relief continues to apply. Currently where at least two dwellings are purchased in a single transaction, or as part of a series of linked transactions between the same vendor and purchaser, the purchaser can choose to have the rate of SDLT determined by the average value of the dwellings purchased, rather than their combined value. Purchasers can [...]

The Annual Tax on Enveloped Dwellings (ATED) was introduced in April 2012 and is charged where certain residential properties are owned within a corporate structure. This tax not only catches UK properties owned by wealthy oligarchs via offshore companies but also applies to UK resident companies. Originally the charge only applied where the value of the property exceeded £2 million but that threshold has been subsequently reduced to £500,000. The charge for 2022/23 starts at £3,800 and rises to £244,750 where the property value is more than £20 million. Properties need to be revalued every five years and the latest [...]