UK Tax Laws A Spaghetti Bowl
Posted: 17/08/2010 Filed under: UK Taxation | Tags: corporate tax, corporation tax, Tax, tax refunds, Taxation Leave a comment »The “spaghetti bowl” of UK tax law is to be simplified with a goal to boost the British economy.
The new government says that the tax system has become a hindrance to businesses under Labour, and that by simplifying it and making it more competitive for small firms it would stimulate economic growth.
George Osborne states “Today we turn the promises of opposition into the policies of government.”
Treasury minister David Gauke said “The tax system created by the previous government was overly complex and has made the tax affairs of millions of families and businesses across the UK extremely complicated.
“We need to reduce the complexities in our tax system and the coalition is committed to delivering that goal.”
The OTS’s remit includes UK taxes and duties controlled by HM Revenue and Customs, but it will not deal with tax credits or taxes administered by other bodies nor will it have any say in the setting of tax rates.
The chairperson of the new body will be Michael Jack, former Conservative MP and Treasury minister and the director shall be tax director at the Chartered Institute of Taxation, John Whiting. Neither shall be paid for their services.
This is truly excellent news for small businesses in UK, with the tax system easier to understand, people wont be as worried to start up in the market, causing the British economy to grow again. I know my clinets will welcome it and I am relived the government has finally seen the light.
If you need help understanding the laws on tax as they stand or how the changes will affect you please get in touch with us here at St Matthew’s eAccounting. We are happy to help.
Interest Rates To Rise Or Not To Rise
Posted: 27/07/2010 Filed under: Small Business, UK Immigration, UK Taxation, Uncategorized, VAT | Tags: business concerns, corporation tax, tax refunds, Taxation, UK tax, VAT Leave a comment »Andrew Sentance was on his own in calling for a rise in interest rates from 0.5pc to 0.75pc for a second month running. With VAT up, taxes up and employment down it seems to be one of the few things to stay stagnant.
Mr. Sentance argued that “the inflation outlook had shifted sufficiently to justify beginning to raise interest rates gradually”.
The rate of inflation has remained constantly high this year and despite falling 0.5pc, from 3.7pc to 3.2pc in the past two months, is still way above the banks target of 2pc. However the call was denied again as majority of members believe inflation will fall over time.
The minutes from a Bank of England rate-settlement meeting read “the weight of evidence from both home and abroad continued to indicate that the margin of spare capacity was likely to bear down on inflation and bring it back to the target in the medium once the impact of temporary factors had worn off.”
This time however, there was some sympathy with Mr. Sentance as policymakers acknowledged that inflation is “likely to remain above target for some months as the impact of the past increases in indirect taxes and oil prices, and the depreciation of sterling offset downward pressure on inflation from spare capacity”.
The increase in VAT to 20pc is also “likely to add to inflation [as] some companies may anticipate the increase by raising prices in advance”. They fear a rise in “medium-term inflation expectations” becoming entrenched by feeding into pay settlements.
However, the “committee’s central view remained that the substantial margin of spare capacity was likely to persist for some time and would bear down on inflation over the medium term”.
In my humble opinion this view is good, UK tax payers are happy to keep the 0.5pc interest rate, Mr. Sentance needs to stop pushing for this and let the market settle in its own time. It seems there are more than one or two experts who agree with me.
Income tax To Remain At 20 Pence
Posted: 15/04/2010 Filed under: UK election, UK Taxation, VAT, VAT Registration | Tags: business, business concerns, corporate tax, corporation tax, Tax, tax refunds, Taxation Leave a comment »Income tax is another one of those emotive issues that seem to crop up every single election. The thing that astounds me is that politicians are silly enough to think that a promise to keep basic income tax down will be a sure fire winner with their constituents. I am sure their are those among us that are obsessed with this issue, just are their are those that will grumble endlessly when the publican in my local puts up the price of a pint by a penny. But that fact is that most of us are aware of the need for taxation, understand that occasionally it needs to be increased and think their are more pressing issues.
Having stood firmly on my soapbox and said all that I have to add that I think that Mr Brown’s decision to promise to keep the lowest rate of tax steady at 20 pence in the pound is a good one. Figures prove that the lower income earners of your society pay out far more of their income proportionally than anyone else. I tend to think that taxing them anymore would be counter productive.
As to whether the policy will help in way to get the labour party elected, I have my doubts. It is a sad fact that the lowest income earners this is directed at are the least likely of any one to come out to vote.
If you are concerned in anyway about income tax or VAT or corporate tax then please do get in contact. We deal with taxation issues every day and would love to help you out.
Budget Highlights-VAT Not Even Mentioned
Posted: 26/03/2010 Filed under: Small Business, UK Company Set Up, UK Taxation, VAT, VAT Registration | Tags: corporate tax, corporation tax, Tax, tax refunds, Taxation, uk companies, uk investments, UK tax, VAT Leave a comment »The first thing i have to say about this years budget is wow, you are really out of luck if you are a cider drinker! ten percent rise plus inflation, i have a funny feeling that there may be a repeat of the famous banning of darling from pubs, this time it is especially likely in places such as Somerset who are bound to be far from tickled by this development. Apparently the rise is due to a lack of tax on cider in recent times but I have a feeling that cider drinkers will not be feeling blessed. Aside from the news on cider in some ways the budget was more notable for what it did not say, there was, for example no mention of VAT.
Given the large amount of speculation recently about the possibility of a rise in VAT its absence was a surprise for some. In regards to what i wrote in the previous blog this week, I am delighted to see that so far Mr Darling has stuck by his word. For me that is more important than the fact that VAT has stayed the same.
Rises in fuel will bug the commuter but as far as the economy is concerned the bigger worry will be for those businesses that have transport at their heart. Is there ever going to be a year where these guys are not whacked in some way?
Aside from these points the usual suspects were there, two percent on beer wine and spirits, one percent on cigarettes. Perhaps the biggest news was the adjustments on stamp duty. I shall blog further on this topic tomorrow.
In the meantime the the 31st of March is approaching so if you are having trouble getting your head around UK tax give us a ring here at St Matthew’s eAccounting and we will make it all simple for you.
UK Needs Tax Reform To Encourage Investment
Posted: 21/03/2010 Filed under: Uncategorized | Tags: Moving to London, moving to the UK, moving to UK, Non Dom, non dom tax, tax refunds, Taxation, uk companies, UK tax Leave a comment »The treasury has recently announced proposals for the reform of taxation in this country that has given real hope that the UK will once again become attractive to people managing a multinational. The proposals for reform centre mainly on holding companies and there is no doubt that bit of complex taxation law does need some attention and some serious sorting out. It is certainly not the only part of our system that could do with an overhaul but it is a good place to start.
The thing we have to hope for now, as pointed out in an article in this week’s Telegraph is that the key staff of these multi nationals will see moving to London and building a life in the UK as a good lifestyle choice for them. It is all very well a multi national choosing the places in the world that most benefit them but often these types of companies depend on the top notch calibre of its staff to stay on top. If said staff are reluctant to live in the UK then the company may decide it is not the place for them.
People totally ignore this when they go on and on about the non dom issue. We need to tread a fine line here. Non domicile seems to have become a dirty word but in actual fact we need these people. And yet we are driving them away. April’s headline rate of 50 pc is the 5th highest of all thirty of the OECD countries. Effectively what this means is that a company may decide that Paris or Geneva are a better alternative to London and then they do not bring their company and all its associated benefits to the UK.
Just as we are changing the taxation for companies to make this a great destination for them we are making it harder for them to staff their business. That is something we need to be very careful of as we try to put our economy back on top.
If you have any questions involving non dom status or company taxation we would be happy to talk them through with you.
Fraud Attacks UK Tax Payers
Posted: 17/03/2010 Filed under: UK Company Set Up, UK Taxation | Tags: corporate tax, corporation tax, non dom tax, Tax, tax refunds, Taxation, uk companies, UK tax Leave a comment »As if we do not already fear taxation enough there was a recent report I read that outlined a phishing scheme that is designed to literally rob you of your money. It claims to be from HMRC which I think is very clever as who among us would not rush to open an email from that particular office?
Even more cunningly the email goes on to tell you that the taxation office have made a miscalculation(not unheard of these days what with all the new equipment going in up there) and want to refund some of your taxation. It is apparently a particularly well done email. I do not claim to know an awful lot about these technical things but what it does, according to the report, is use an image called ‘in-line-images’ which automatically copies images from sites like Paypal and RBS Wordplay to give the email a real air of legitimacy.
All you need to do to claim back your tax is to fill in the accompanying sheet with all your financial details and HMRC will get right onto getting you your refund. And of course this is where it all goes horribly wrong. You never see any money and in fact are quite like to see the back of some as it disappears out of your account into the accounts of these fraudsters.
The bottom line of course is that you should never give your full account or in this case credit card details including the security code to anyone, even if they do scare the life out of you by claiming to be from HMRC.
If you are struggling with your legitimate UK taxation in anyway then get in touch for a chat. We are the experts in this filed and would love to help you out.
Qrops Work Around UK Residency Rules
Posted: 06/03/2010 Filed under: Offshore Solutions | Tags: corporate tax, corporation tax, Qrops, Tax, tax refunds, Taxation, uk companies, UK tax Leave a comment »Right before I start talking about this subject let me do a bit of jargon busting for you. Qrops are, in their long form, Qualifying Registered Offshore Pension Schemes. And HNW, which I am going to get to in a minute are, by their other name, people who are considered to have High-net-worth.
So, some of you may have heard of Robert Gaines-Cooper. He is a gentleman who has HNW stauts and lived in the Seychelles for over thirty years. Happily obeying, one would imagine, all the tax rules of the place he considered to be his new home. Until the British government decided that he was still very much a British citizen for the purpose of taxes. This must have come as a very nasty shock for Mr Gaines-Cooper.
According to HMRC rules, individuals living abroad who do not permanently and become non-resident are subject to the same pension tax rules as members of UK pension schemes.This can work both ways though if you know what you are doing.
Qrops can be used to make significant tax savings so long as you are prepared to take them at the same time as you would have in the UK. And you choose the correct ones. There are 2,000 schemes approved by HMRC, but some are definitely better than others.
If you think this may be something you are interested in or if you have any other taxation related questions then give us a call here at St Mathew’s eAccounting we can take you through all the details and answer your questions.
Return To Normal Vat Boosts Inflation
Posted: 27/02/2010 Filed under: UK Taxation, VAT, VAT Registration | Tags: corporate tax, corporation tax, Tax, tax refunds, Taxation, uk investments, UK tax Leave a comment »The Office for National Statistics has recently released a report that shows that the return the normal 17.5% VAT figure has pushed inflation up over three percent. The reason this is a significant figure is because the target of the government is to keep it below a figure of 2%.
The Bank Of England Governor, Mervyn King has written a letter to the government outlining the reason for this excess one percent giving three factors for why it has occurred, one of them being the VAT increase. He also cites the massive increase in oil prices which pushed up the price of petrol in turn. The last factor he mentions is the exchange rate. With the sharp depreciation in the sterling in 2007 and 2008 continuing to feed through to the consumer this too has had an effect on inflation.
The good news though according to the very knowledgeable MR King is that this increase in inflation is highly likely to be only temporary. He has expectations of a return to normal in the latter half of the year.
I assume he is right as the factors he states seem sensible and the effect of the increased VAT is likely to even out as time goes on, assuming that the rumour of a VAT increase to 20% prove to be false. Something I am not entirely sure about.
If you are struggling with your tax returns or do not completely understand how VAT works with regard to your business then you should get in contact with us here at St Matthew’s eAccounting. We can make it all clear for you.
Praising UK Tax
Posted: 26/02/2010 Filed under: Small Business, UK Company Set Up, UK Taxation | Tags: corporate tax, corporation tax, Tax, tax refunds, Taxation, uk companies, UK tax Leave a comment »I was actually delighted to see Ruth Sunderland telling it how it really is in the Guardian this week. Or more accurately telling it in a way that I agree with. At first, anyway, until things started to sound a little short sighted.
She was looking at our attitude to taxation in this country and coming to the conclusion that there seems to be a culture that tax evasion is normal and OK, even desirable. She talks about the fact that those people who that tax taken directly form their pay packets have no choice in the matter but that big companies and extremely rich individuals seem to view tax as discretionary. Almost like a charity they can choose to contribute to every now and again.
While this may be exaggerating things a little I have to agree with the sentiment. I have said in this blog before that none of us minds paying tax so long as it is only our fair share and as long as everyone is having to do it. Up to this point of the article i was in full agreement until suddenly she started talking about how investment in business never has the trickle down effect to the rest of us that is planned so therefore business should not be given tax breaks.
FIrstly, tax breaks are a totally different thing from tax evasion and do not belong in the same sentence and secondly I would like to see how Britain fared without its business sector.
Tax evasion is appalling and costs us all in the long run, fair and structured taxation that benefits business does benefit us all in the end.
If you need a hand making sure that your business is paying only its fair share of tax then we are the experts. Get in contact for a chat here at St Matthew’s eAccounting and we will take you through all you need to know.
HMRC Say Just Paying Taxes Is Not Enough
Posted: 24/02/2010 Filed under: UK Taxation | Tags: corporate tax, corporation tax, non dom tax, Tax, tax refunds, Taxation, uk companies, UK tax Leave a comment »In a very interesting move the HMRC has releases a statement that seems to be saying to small business that even if they file their tax return and they file it on time they could still be fined up to £3000. How on earth does that work?
According to an article in the Telegraph, HMRC is insisting that all businesses with between five and 50 employees submit Employer Annual Returns electronically by May 19. they warn that those submitting in the old fashioned way by paper risk being penalised. And the only way out of this? If you are a company whose religious beliefs exclude the use of electronic devices.
It appears that those businesses with fewer than five employers will be given another year to fall in line.
I have to say i am rarely happy with this kind of apparent heavy handedness. Maybe it is a disinclination to be told what to do but i like the right to choice in most things and this is just another one being taken away.
On the bright side i guess it is a good move environmentally as the paper saved must be huge and anything that causes a rise in efficiency over at the HMRC after its problems of the last few months is to be applauded.
Either way there is probably little point in complaining as I cannot see them changing their minds. If you are concerned about how this will effect your business tax returns or have any questions about taxation at all then please ring us for a chat at St Matthew’s eAccounting. We deal with company ta
