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September 2009 - E-NEWS
In this month’s e-news we report on some forthcoming changes to the intestacy rules.
We also include our usual round up of news. Please browse through this month’s articles using the links below and contact us if any issues or questions arise.
- New Disclosure Opportunity
- VAT Increase To 17.5%
- Redundancy Pay
- Cross-Border Vat Changes 2010
- Filing Deadlines
- Company Size Limits
- Medium Sized Accounts
- Group Accounts
HMRC have provided more details of the New Disclosure Opportunity (NDO) which is due to take place from 1 September 2009 to 12 March 2010. The NDO is for people with unpaid tax connected to offshore accounts and assets and will give the taxpayers one final opportunity to disclose.
To encourage taxpayers to disclose undeclared offshore income and gains, the penalty level has been set at 10%. HMRC hope that the low penalty will encourage taxpayers to come forward.
Although the NDO period runs until 12 March 2010 initial contact must be made to HMRC by 30 November 2009.
Dave Hartnett, HMRC Permanent Secretary for Tax, said:
“I know there are people who regret not taking advantage of our Offshore Disclosure Facility (ODF) in 2007 which focused primarily on the customers of five large banks. Now everybody who has not paid the tax they should in relation to offshore accounts or assets has this New Disclosure Opportunity to pay what they owe with penalties on more favourable terms than normal.”
“The procedure is simple and straightforward. Customers will be able to contact us on paper or through a dedicated area of our website. This will be the last opportunity of its kind.”
Please do get in touch, without delay, if you have any concerns in this area.
Internet links: HMRC news release, Basic information and dates
HMRC have issued guidance for businesses dealing with the increase in the standard rate of VAT from 15% to 17.5%. The change takes effect from 1 January 2010. They hope that by issuing the guidance well in advance of the change that businesses will have sufficient time to prepare.
If you would like guidance in this area please do get in touch.
Internet link: HMRC guidance on 17.5%
The weekly maximum pay which can be taken into account when calculating statutory redundancy pay is set to increase from 1 October 2009.
Employees who have at least two years’ continuous service qualify for a redundancy payment.
The entitlement is as follows:
- for each complete year of service until the age of 21 - half a week’s pay
- for each complete year of service between the ages of 22 and 40 inclusive - one week’s pay
- for each complete year of service over the age of 41 - one and a half weeks’ pay.
A week’s pay is that to which the employee is entitled under his or her terms of contract as at the date the employer gives minimum notice to the employee. The maximum statutory limit for a week’s pay is £350 with effect from 1 February 2009 and will increase to £380 with effect from 1 October 2009. The maximum service to be taken into account in calculating redundancy is 20 years. This means that the maximum statutory payment cannot exceed 30 weeks’ pay or £10,500 (£11,400 Oct 2009).
The maximum week’s pay figure is generally reviewed annually however the £380 limit will continue until 1 February 2011. Employers may, of course, pay in excess of the statutory minimum.
Internet link: Direct gov website redundancy
HMRC have issued important updates in advance of the changes in the place of supply of services rules which take effect from 1 January 2010.
This guidance is part of a package of measures being introduced to simplify and modernise the VAT system for cross-border trading and to counter fraud across the EU. The measures include:
- changes to the basic place of supply of services rules
- changes to the time of supply rules
- European Sales List (ESL) reporting for supplies of cross-border services
- a new electronic refund procedure for VAT incurred in other EU Member States.
If you have any queries on these changes please do get in touch.
Internet link: HMRC cross border changes
Companies now have one month less within which to get their accounts filed - be aware, and watch out for shortened accounting periods: any accounting periods on or after 6 April 2008 falls under the new rules!
New, higher limits apply to the small/medium company thresholds and the audit exemption thresholds. These are set out below:
There is no longer an option to file an abbreviated profit and loss account (which for medium sized companies used to start at the Gross Profit line). There is still an option not to disclose detailed particulars of turnover in the notes.
There is no longer an exemption from preparing group accounts for a medium sized company. Note that parent companies which themselves are 100% subsidiaries of larger groups that draw up group accounts are still exempt.
HWB
Chartered Accountants, Highland House, Mayflower Close, Chandlers Ford, Eastleigh,
Hampshire, SO53 4AR.
