Our newsletter this month contains the following articles: reminder to file your tax return on time, future changes to workplace pensions, VAT issues for charities and changes to company car fuel rates.
File on time or else!
In the past as long as you paid your tax liabilities on time, cleared any self assessment tax due by 31 January, no late filing penalties were due. Even if you failed to pay your tax on time, late filing penalties were capped at £100 or nil if you were due a tax refund.
The goal posts have moved!
The 2010-11 tax returns have to be filed by 31 October 2011 if you are filing a paper return, or 31 January 2012 if you are filing electronically. If you fail to meet these deadlines you face the following penalty regime, even if your tax payments are up-to-date.
As you can see the minimum penalty for filing 6 months late is £1,300 even if all your tax due is paid on time or you are due a tax repayment.
Employers face a possible 3% hike in employment costs!
The Pensions Regulator has published information about proposed workplace pension changes that are due to be phased in from next year.
Workers you will need to enrol in the new workplace pension arrangements unless they expressly choose to opt out are:
Each employer will be given a date from which changes will have to be in place. This will be known as the staging date. Larger employers will have the earlier staging dates. The staging dates will begin in October 2012 and continue through to 2016.
Readers may find the following notes useful:
More general information on the changes is available at www.dwp.gov.uk/policy/pensions-reform
VAT issues for charities
Charities only need to account for VAT on those parts of its activities that are within the scope of VAT. A quick check list follows:
The VAT status of the charity shops is advantageous. Even if the zero rated sales are below the current registration limit, £73,000, it would be worthwhile registering the trade voluntarily as any associated costs that include VAT can be reclaimed.
Although most grants received by a charity are outside the scope of VAT occasionally grant providers will require the charity to provide services to individuals or groups as a direct condition of grants made. If this is the case the grant is a standard rated transaction. In most cases this will not cause difficulties as most grant providers are Local Authorities that are VAT registered and can claim back any VAT charged.
New car fuel rates
HMRC have published revised Company Car advisory fuel rates to use from 1 September 2011.
These rates can be used to calculate private fuel costs reimbursed by employees on a mileage basis, or to calculate the amount of VAT input tax that employers can recover on company car mileage claims that are attributable to fuel rather than other running costs.
Petrol and LPG users (Engine size, Petrol, LPG pence per mile)
1400cc or less: 15p, 11p
1401cc to 2000cc: 18p, 12p
Over 2000cc: 26p, 18p
Diesel users (Engine size, Diesel pence per mile)
1600cc or less: 12p
1601cc to 2000cc: 15p
Over 2000cc: 18p
Tax Diary October/November 2011