HLAS

Starting 1 August 2024, Amazon will begin charging VAT at 20% on selling fees for UK vendors. This change results from a shift in the legal entity responsible for charging these fees. Previously, fees were billed by Amazon Services Europe S.a.r.l (ASE), which didn't have a UK establishment, making the fees subject to the VAT reverse charge procedure. However, from 1 August, fees will be charged by Amazon EU S.a.r.l (AEU), which has a UK branch. Consequently, AEU is required to apply VAT at 20% to these fees. VAT-registered vendors can reclaim the VAT, following the usual partial exemption rules. [...]

HM Revenue and Customs (HMRC) have released draft legislation and a policy paper detailing the proposed abolition of the furnished holiday lettings (FHL) tax regime. Originally announced by the previous government, any hopes that this might be delayed under the new administration have now been dispelled. The new measures are set to take effect from 6 April 2025 for income and capital gains tax, and from 1 April 2025 for corporation tax. These changes will eliminate the tax advantages that furnished holiday let landlords currently enjoy over other property businesses, as outlined below: Loan interest will be limited to the [...]

As anticipated, the Bank of England reduced their base interest rate on August 1 from 5.25% to 5%. The decision was a close call, with a majority of five to four voting in favour of the cut. The Monetary Policy Report that accompanies the decision explains that while higher interest rates have helped return inflation to the Bank’s target of 2% and allowed them to make this cut, they are expecting a temporary increase to 2.75% later this year. Why might inflation increase again? The fall in household energy prices has been helping to bring inflation down, however as energy [...]

Last week, Chancellor of the Exchequer Rachel Reeves addressed the House of Commons to present the findings of a Treasury spending audit. She had previously hinted at this during discussions about assessing the public spending legacy. According to the Chancellor, the audit uncovered £22 billion in unfunded commitments inherited from the previous government. These include obligations related to the Rwanda scheme, the Advanced British Standard, and the New Hospital Programme. Additionally, there were shortfalls due to the failure to increase Departmental budgets to accommodate public sector pay settlements. To begin addressing the overspend, the Chancellor announced savings of £5.5 billion [...]

The new Worker Protection (Amendment of Equality Act 2010) Act 2023 will come into effect on 26 October 2024. This Act imposes a new legal duty on employers to take reasonable steps to protect their workers from sexual harassment. The Equality and Human Rights Commission (EHRC) holds the authority to take enforcement action against employers who fail to comply with their duties under the Act. Employment tribunals will also have the power to increase compensation for sexual harassment by up to 25%. To assist employers in understanding their obligations and adhering to the new requirements, the EHRC has updated its [...]

Losing a job can be a very challenging and stressful experience. However, if your employer has become insolvent and cannot pay you money that you are owed this adds even further to your stress. If you are in this situation, the latest Annual Report from the Insolvency Service highlights some important information about the support available that may be available to you through the Redundancy Payments Service (RPS). Here’s what you need to know. Key Figures and Support In 2023-2024, the RPS received 85,592 claims for redundancy payments. Funded by National Insurance Contributions, the service disbursed a total of £494 [...]

On Friday 19th July, significant IT outages impacted businesses worldwide. The outages primarily affected companies using security software from CrowdStrike. An error in a recent update to their antivirus software caused disruptions in many leading businesses' systems. The National Cyber Security Centre (NCSC) has confirmed that the outages were not the result of a security incident or malicious cyber activity. They have encouraged affected businesses to apply the fix that has already been issued and emphasised the importance of continuing to install security updates as an essential security practice. The NCSC has also reported an increase in phishing attempts referencing [...]

The King’s Speech detailed proposals for a number of areas of new legislation that are likely to affect small employers. The Federation of Small Businesses (FSB) subsequently reported that nine-in-ten employers surveyed by them had said they have concerns that the costs and risks associated with employing people would be increasing. The FSB also noted that there was no legislation announced to tackle the poor payment practices of big businesses toward their small suppliers. FSB Policy Chair Tina McKenzie said late payment “hampers cashflow and stifles investment, and we call on the Government to look again.” See: https://www.fsb.org.uk/resources-page/fsb-weekly-brief-newsletter-friday-19-july-2024.html

The recently released Insolvency Service's 2023-24 Annual Report and Accounts provides insightful information on the agency's efforts in addressing Covid loan abuse. According to the report, 831 directors have been disqualified for misusing Covid loans. Additionally, 22 criminal prosecutions have been carried out, and nearly £3 million has been recovered for the taxpayer. The report also highlights broader enforcement activities. In total, 1,222 directors were disqualified for various forms of misconduct. During the year, 139 live company investigations were conducted, and 45 companies were ordered to wind up for acting against the public interest. The Insolvency Service successfully returned nearly [...]

The Chancellor, Rachel Reeves, has announced a comprehensive review designed to enhance pension investments, increase pension pots, and minimise waste within the pensions system. This review, spotlighted in the King's Speech, confirms a new Pensions Bill that could bring significant benefits to UK pensioners and the wider economy. Here’s an analysis of what the review might entail: Key Highlights of the Pensions Review Boost to Pension Pots: The proposed Pensions Bill has the potential to augment pension pots by over £11,000 for savers in defined contribution schemes. The bill also advocates for further consolidation and diversified investment strategies to yield [...]