Staff Tax Tips – 7 September 2018

Staff tax tips for this week are listed below. We have added links to more detail as appropriate. We will be adding a least two posts a month under this heading so please ask your staff to add their names to our newsletter distribution list that will link to these articles.

Class 2 NIC

The long running saga to dispense with Class 2 NIC for the self employed, which was due to happen April 2019, is apparently to be abandoned by the Treasury according to press commentary circulating yesterday (6 September 2018).

If true, this long overdue simplification of NIC for the self-employed will no longer occur. Perhaps it was the complex changes to Class 4 NIC – to provide qualifying contributions for State Benefits and Pension rights – that has proved to be the nail in the coffin?

Brexit, the hard variety

The government has issued a fairly comprehensive set of guidelines setting out the likely consequences of a no-deal exit from the EU. The gateway to this information is summarised here.

In the domain of taxation, and particularly VAT and duties, affected clients will need to factor in the cash flow and profit affects of customs tariffs and import VAT. If you have time, read the relevant section of HMRC’s guidance here. HMRC do seem to be responding to lobbying by the business community. On one point in particular, “Accounting for import VAT on goods imported into the UK” HMRC have confirmed that:

If the UK leaves the EU without an agreement, the government will introduce postponed accounting for import VAT on goods brought into the UK. This means that UK VAT registered businesses importing goods to the UK will be able to account for import VAT on their VAT return, rather than paying import VAT on or soon after the time that the goods arrive at the UK border. This will apply both to imports from the EU and non-EU countries.

In reaching this decision, the government has taken account of the views of businesses and sought to mitigate any adverse cash-flow impacts keeping VAT processes as close as possible to what they are now. 

If the UK leaves the EU without an agreement, the government will introduce postponed accounting for import VAT on goods brought into the UK. This means that UK VAT registered businesses importing goods to the UK will be able to account for import VAT on their VAT return, rather than paying import VAT on or soon after the time that the goods arrive at the UK border. This will apply both to imports from the EU and non-EU countries.

In reaching this decision, the government has taken account of the views of businesses and sought to mitigate any adverse cash-flow impacts keeping VAT processes as close as possible to what they are now. 

Clients who trade with the EU are likely to be in for an unsettling period next year and until the dust settles, both with regard to the terms of Brexit and the transitional arrangements. Professional advisers will need to keep their wits about them and be ready to step in and help affected businesses meet these challenges.

 

Why is “consent” an important element of the new the GDPR?

If you are still unclear on this issue take a look at the ICO website, and in particular, this section here

 

Bob Edwards

Bob has been working with practices across the UK offering novel ways to improve cross-sales and increase new client acquisitions. He is also interested in "step changes" in legislation that offer challenges, and therefore opportunities, for practitioners to provide new recurring and one-off support services to clients.

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

blog text content for accountants

Get 4 professionally written articles to use on your website absolutely FREE

Simply sign up to my Weekly Insight newsletter (*)

No copyright restrictions

(*) offer applies to new subscribers only