Insolvencies Increase as HRMC Tightens Time To Pay

Business insolvencies in the UK have increased in the first quarter of 2011 as the HMRC tightens its approach to its Time To Pay rules. The Government’s Insolvency Service figures show that in the first three months of the year insolvencies in the UK increased by 3.17%, with 4,121 companies failing. At the same time figures from HMRC show that the number of Time To Pay (TTP) requests refused increased to 9.3%, compared to a refusal rate of just 2.7% in 2009. Peter Whalley, a partner in the Insolvency team at Thames Valley accountants and business advisers James Cowper, said: “Whilst it is difficult to establish a direct link between the increase in business failures and the tougher stance taken by HMRC it does paint a particularly gloomy picture for struggling SME businesses.” ... »

Employers Must Hit May PAYE Deadline

Employers have been warned to file their Employer Annual Returns online with HM Revenue & Customs (HMRC) before the 19th May, or risk being charged a late-filing penalty. Employers that miss the deadline will be charged £100 per month that the return is late. Previous concessions have been removed, meaning that all businesses need to be careful to meet the deadline. “Changes came into effect this year, which mean the Employer Annual Returns sent to HMRC after the 19 May filing deadline will almost certainly result in a late-filing penalty.” said an HMRC spokesman. “Last year, no penalty was charged for employers with five or fewer employees, but these transitional arrangements have now ended.” “Previously, an extra-statutory concession gave employers extra... »

HMRC: File Returns and Pay Corporation Tax Online

Businesses must file their corporation tax returns online and make payments electronically from 1 April, HM Revenue & Customs (HMRC) has warned. Companies with accounting periods ending after 31 March 2010 are obliged to file their company tax return online. All businesses will have to pay corporation tax bills electronically from April by Direct Debit, debit or credit card, using the BillPay service or bank transfer. HMRC spokeswoman, Helen Jones, said that from April 2012 it will also become compulsory for all firms registered for VAT to submit their returns online. “We’ve found that a lot of businesses have already voluntarily registered for VAT online,” she added. “They’re ahead of the game.” To sign up for corporation tax online filing, visit the HMRC website »

HMRC Record-keeping Guides Help Firms Organise Tax Paperwork

Small businesses can access free online information to help them improve their tax records, ahead of HM Revenue & Customs’ (HMRC) crackdown on business books later this year. HMRC has launched four new products to help the self-employed and small businesses keep better records: a factsheet on how to keep records a guide to keeping records for tax returns, including common problems and examples for different types of business a guide to setting up a basic record-keeping system, with examples of spreadsheets an interactive checklist that tells businesses how well they are keeping records and how to improve them. HMRC business customer unit acting director, Brian Redford, said that setting up a good system of record-keeping is time well spent for small firms. “Get a proper system in place... »

£90m Fines and Record Use for Tax Self-Assessment

As football’s transfer window "slammed shut" last night so too did the window for Britain’s self-employed to file their tax returns. The HM Revenue & Customs‘ online self-assessment service saw a record number of submissions this year as entrepreneurs and self-employed workers filed their tax returns before the midnight deadline on the 31st January. Last year the HMRC had a total of 6.42 million tax returns submitted and by midday on Monday 31st January 2011, a clear 12 hours before "close of play", they had already received 6.45 million submissions, some 30,000 greater than the previous year; and that was with an estimated 300,000 additional returns expected later in the day. By this morning the official figure was 6.9 million people, or 6,907,410... »

SMEs: Check Records Ahead of HMRC Crackdown

15th January 2011 Small firms should check that their books are in order ahead of a crackdown on those keeping bad tax records, the Association of Chartered Certified Accountants (ACCA) has warned. HMRC announced the crackdown in a December consultation document, Business Records Checks, which included plans to investigate the records of 50,000 small businesses every year. Firms not keeping tax records up to date risk paying a penalty of up to £3,000. “HMRC are concerned that record keeping by small businesses has been shoddy, and believe that this will make them keep their records up–to–date all the time,” said ACCA’s head of taxation, Chas Roy–Chowdhury. “There’s a lack of understanding at HMRC of how small businesses operate — books and records are often updated ... »

Software Bug Prevents Business Owners Amending Tax Returns

Business owners submitting self-assessment tax returns may face delays on any rebates they are owed following a glitch in the Her Majesty’s Revenue & Customs (HMRC) website, small business software firm Sage has revealed. The online self-assessment filing system should allow users to amend their tax returns on the HMRC website as many times as they need before the 31 January deadline, to ensure the data they entered is correct. But due to a software bug, anyone trying to enter the system to make a second amendment has been locked out and shown an error message. Sage said that small-business owners who have submitted incorrect data on the site and pay too much tax as a result could face a delay in receiving a rebate. “The first thing to do when you encounter any issues with ... »

New QuickBooks Simplifies VAT Returns

Intuit UK has today launched the latest version of its QuickBooks software. The new product is designed to make small business bookkeeping quick and easy, helping small businesses take control of their finances. Packed with new features and improvements the new product includes the new VAT Exception Report which makes it easy for small businesses to manage the changes that might occur after filing VAT. The report automatically adjusts calculations, ensuring the next VAT report is accurate and provides a transparent audit trail for both the small business owner and HM Revenue & Customs (HMRC). In addition, the new One Step VAT Returns feature allows small businesses to automatically populate their quarterly VAT returns and to file them instantly and securely online with HMRC. This great... »

Proposed Powers Could Criminalise Tax Advice

Draft legislation by HM Revenue and Customs (HMRC) could see accountants unable to offer their clients even the most basic advice, warns ACCA (the Association of Chartered Certified Accountants) today. HMRC’s consultation on their draft legislation – called Tax Agents and Deliberate Wrongdoing – is controversial because it defines almost anyone in the financial system as a ‘tax agent’, and it classes any tax planning, including using government incentives, as ‘deliberate wrongdoing’. Chas Roy-Chowdhury, ACCA’s head of taxation, says: “ACCA is concerned that even revised proposals will target advisers who counsel on what HMRC call ‘unacceptable tax avoidance’. With no clear definition of what tax advice is ‘unacceptable... »

Allow Time for VAT Cheques to clear, warns HMRC

Allow Time for VAT Cheques to clear, warns HMRC

Businesses must allow enough time for cheques to clear when paying VAT or risk incurring a fine, HM Revenue & Customs (HMRC) has warned. From 1 April 2010, cheques will be only treated as received by HMRC when cleared funds reach its bank account — not the date the cheque arrived in the post. This means that businesses must allow enough time for payment to clear by the due date on their VAT return or risk being charged a penalty. “To allow for possible postal delays, which HMRC isn’t responsible for, businesses should allow at least three working days for a cheque payment to reach us and a further three days for the payment to clear our bank account,” said an HMRC spokesman. Also from 1 April 2010, all businesses with an annual turnover of £100,000 or more... »

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