News Archive - May 2014
Tax investigators collect record amount this year - 27.5.2014
£23.9 billion was collected through tax investigations over the past twelve months, claims HM Revenue and Customs (HMRC).
This is an increase of £3.2 billion on the previous twelve-month period, and £9 billion on the period before that. HMRC said it was almost £1 billion above the target set by Chancellor George Osborne.
According to official figures, over £8 billion of the haul came from large businesses. A further £1 billion came from criminals and £2.7 billion from tackling avoidance schemes.
‘The Government supports the hard-working, honest majority of taxpayers that play by the rules, and is determined to tackle the minority that seek to avoid paying the taxes they owe,’ said Exchequer Secretary to the Treasury, David Gauke.
He continued: ‘We set HMRC ambitious targets to increase its yield and the figures published today demonstrate that HMRC is successfully meeting these challenges’.
HMRC said it aims to secure £100 billion between May 2010 and March 2015 through investigations into unpaid tax.
This is an increase of £3.2 billion on the previous twelve-month period, and £9 billion on the period before that. HMRC said it was almost £1 billion above the target set by Chancellor George Osborne.
According to official figures, over £8 billion of the haul came from large businesses. A further £1 billion came from criminals and £2.7 billion from tackling avoidance schemes.
‘The Government supports the hard-working, honest majority of taxpayers that play by the rules, and is determined to tackle the minority that seek to avoid paying the taxes they owe,’ said Exchequer Secretary to the Treasury, David Gauke.
He continued: ‘We set HMRC ambitious targets to increase its yield and the figures published today demonstrate that HMRC is successfully meeting these challenges’.
HMRC said it aims to secure £100 billion between May 2010 and March 2015 through investigations into unpaid tax.
New flat rate State Pension plans become law - 22.5.2014
Government plans to reform the State Pension have now become law, paving the way for the introduction of a single-tier flat rate pension with effect from 2016.
The new single-tier pension will replace the existing two-part system, with the aim of reducing complexities in the system and providing clarity regarding the value of individuals’ income on retirement.
Under the reforms, the Additional State Pension will merge with the basic State Pension. The move will also see the end of derived entitlement to the basic State Pension.
The new flat rate pension will be set above the basic means test, currently £148.35. To qualify for any State Pension, individuals will need ten qualifying years of national insurance contributions (NICs). Once the changes are introduced, those beginning to make NIC payments for the first time will need 35 years of contributions.
Studies suggest that those most likely to benefit from the change are individuals who have spent long periods of time out of work or in low-paid jobs, the long-term self-employed, and those who contracted out of the earnings-related State Second Pension.
Commenting on the news, Minister for Pensions Steve Webb said, ‘The new State Pension will replace the current complex mix of basic and Additional State Pension which successive governments have tinkered with so much over the decades’.
‘It will give people clarity and confidence about what income they will get from the state in their retirement. In addition, the State Pension reforms will benefit those who have historically done poorly under the current two-tier system.’
The new single-tier pension will replace the existing two-part system, with the aim of reducing complexities in the system and providing clarity regarding the value of individuals’ income on retirement.
Under the reforms, the Additional State Pension will merge with the basic State Pension. The move will also see the end of derived entitlement to the basic State Pension.
The new flat rate pension will be set above the basic means test, currently £148.35. To qualify for any State Pension, individuals will need ten qualifying years of national insurance contributions (NICs). Once the changes are introduced, those beginning to make NIC payments for the first time will need 35 years of contributions.
Studies suggest that those most likely to benefit from the change are individuals who have spent long periods of time out of work or in low-paid jobs, the long-term self-employed, and those who contracted out of the earnings-related State Second Pension.
Commenting on the news, Minister for Pensions Steve Webb said, ‘The new State Pension will replace the current complex mix of basic and Additional State Pension which successive governments have tinkered with so much over the decades’.
‘It will give people clarity and confidence about what income they will get from the state in their retirement. In addition, the State Pension reforms will benefit those who have historically done poorly under the current two-tier system.’
Firms urged to prepare for pensions auto-enrolment - 16.5.2014
As the phased introduction of pensions auto-enrolment continues, recent research has suggested that more than 80% of employers are facing increased costs as a result of the new regime.
Auto-enrolment is being phased in over a number of years, and will require most UK employers to automatically enrol eligible workers into a qualifying pension scheme and to pay a minimum contribution into the fund.
The research suggests that while some of the increased costs are accounted for by employer contributions, preparing data and dealing with administration are also proving to be significant cost factors.
Employers must adopt auto-enrolment with effect from their allocated ‘staging date’. Further information on staging dates can be viewed here: www.thepensionsregulator.gov.uk/staging.
Businesses are being encouraged to ensure that they prepare for auto-enrolment in good time.
Auto-enrolment is being phased in over a number of years, and will require most UK employers to automatically enrol eligible workers into a qualifying pension scheme and to pay a minimum contribution into the fund.
The research suggests that while some of the increased costs are accounted for by employer contributions, preparing data and dealing with administration are also proving to be significant cost factors.
Employers must adopt auto-enrolment with effect from their allocated ‘staging date’. Further information on staging dates can be viewed here: www.thepensionsregulator.gov.uk/staging.
Businesses are being encouraged to ensure that they prepare for auto-enrolment in good time.
Interest rates 'to rise in early 2015' - 12.5.2014
One of the UK’s leading business groups has predicted that interest rates will rise to 0.75% in the first quarter of next year.
According to the Confederation of British Industry (CBI), interest rates are likely to rise from their current level of 0.5% to 0.75% in the first three months of 2015, rather than in the third quarter as previously predicted by the organisation.
The CBI has also revised upwards its forecasts for economic growth, anticipating growth of 3% for 2014 and 2.7% for 2015.
However, despite reporting increased levels of confidence and business investment across all areas of the economy, the business group has urged political parties to ensure that the positive economic message does not become buried in the run-up to the election.
CBI director-general John Cridland warned, ‘Politicians must be wary of the risk of headline-grabbing policies that weaken investment, opportunity and jobs’.
The CBI’s upgraded forecasts follow a recent report from the National Institute of Economic and Social Research (NIESR), which suggests that the UK economy is nearing pre-financial crisis levels.
According to the Confederation of British Industry (CBI), interest rates are likely to rise from their current level of 0.5% to 0.75% in the first three months of 2015, rather than in the third quarter as previously predicted by the organisation.
The CBI has also revised upwards its forecasts for economic growth, anticipating growth of 3% for 2014 and 2.7% for 2015.
However, despite reporting increased levels of confidence and business investment across all areas of the economy, the business group has urged political parties to ensure that the positive economic message does not become buried in the run-up to the election.
CBI director-general John Cridland warned, ‘Politicians must be wary of the risk of headline-grabbing policies that weaken investment, opportunity and jobs’.
The CBI’s upgraded forecasts follow a recent report from the National Institute of Economic and Social Research (NIESR), which suggests that the UK economy is nearing pre-financial crisis levels.
Revenue to recover unpaid tax 'directly from taxpayer accounts' - 8.5.2014
HM Revenue & Customs (HMRC) is set to recover unpaid tax and overpaid tax credits directly from the bank accounts of businesses and individuals that fail to pay, under new rules.The Direct Recovery of Debts (DRD) initiative was outlined in the 2014 Budget and the proposals are now under consultation. If approved, DRD will allow HMRC to recover tax debts from taxpayers who owe more than £1,000.
HMRC will be able to take money from bank accounts, building society accounts and Individual Savings Accounts (ISAs).
According to HMRC, only those with long-term debts who have received at least four payment demands will be targeted.
A minimum total of £5,000 will be left across debtors’ bank accounts, including their savings accounts. The amount owed will be frozen in debtors’ accounts for a period of 14 days before being seized, to give taxpayers the opportunity to contact HMRC regarding payment of the debt.
Around 17,000 individuals are expected to be affected by the measures, which are set to take effect in 2015.
We can help with all of your tax planning needs, please contact us to arrange a free consultation.
HMRC will be able to take money from bank accounts, building society accounts and Individual Savings Accounts (ISAs).
According to HMRC, only those with long-term debts who have received at least four payment demands will be targeted.
A minimum total of £5,000 will be left across debtors’ bank accounts, including their savings accounts. The amount owed will be frozen in debtors’ accounts for a period of 14 days before being seized, to give taxpayers the opportunity to contact HMRC regarding payment of the debt.
Around 17,000 individuals are expected to be affected by the measures, which are set to take effect in 2015.
We can help with all of your tax planning needs, please contact us to arrange a free consultation.
Report indicates surge in self employment - 6.5.2014
The think tank Resolution Foundation has released a report showing that the number of self employed people has increased by 650,000 since 2008.
4.5m people are now self employed in the UK. Concerns have been raised that this increase could be the real driving force behind the recent fall in unemployment figures, which the Coalition Government has been keen to promote in recent months.
Bank of England policy makers are discussing whether this increase reflects structural changes in the UK economy or ‘disguised labour market slack’.
The Office for National Statistics reported that more than 70% of those newly self employed are aged over 50, indicating that the move could be made as an alternative to retirement.
The Resolution Foundation said the increase presents ‘a worrying picture of the security and vulnerability of self employed people’. This is due to their being unlikely to contribute to a pension. Figures indicate that 31% of self employed contribute to a pension compared with 52% of employees.
4.5m people are now self employed in the UK. Concerns have been raised that this increase could be the real driving force behind the recent fall in unemployment figures, which the Coalition Government has been keen to promote in recent months.
Bank of England policy makers are discussing whether this increase reflects structural changes in the UK economy or ‘disguised labour market slack’.
The Office for National Statistics reported that more than 70% of those newly self employed are aged over 50, indicating that the move could be made as an alternative to retirement.
The Resolution Foundation said the increase presents ‘a worrying picture of the security and vulnerability of self employed people’. This is due to their being unlikely to contribute to a pension. Figures indicate that 31% of self employed contribute to a pension compared with 52% of employees.
