21stJul
News article

HMRC launches consultation on basis period reform

HMRC has recently launched a consultation on how basis periods can be reformed for income tax for the self-employed.

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HMRC has recently launched a consultation on how basis periods can be reformed for income tax for the self-employed.

The consultation seeks to gather views on how best to implement a proposal to simplify the rules under which profits of an unincorporated trading business are allocated to tax years using basis periods.

In the consultation, the current rules for basis periods are outlined, alongside a specific proposal to simplify them and suggestions regarding transitional rules for moving to a new system.

HMRC hopes to simplify the system before Making Tax Digital (MTD) is implemented.

The proposal affects the self-employed, partnerships, trusts and estates with trading income. It mainly affects unincorporated businesses that do not draw up annual accounts to 31 March or 5 April, and those that are in the early years of trade.

HMRC stated that it would like to gather views on the matter from businesses, advisers, tax software providers and representative bodies. The consultation can be found here.

20thJul
News article

CIOT urges government to make tax system easier to navigate

The Chartered Institute of Taxation (CIOT) has urged the government to use its tax administration review to make the UK tax system easier to navigate for taxpayers.

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The Chartered Institute of Taxation (CIOT) has urged the government to use its tax administration review to make the UK tax system easier to navigate for taxpayers.

The CIOT has suggested a handful of 'practical improvements', including developing a single system for taxpayers to use to register and deregister for different taxes; creating a single customer account where taxpayers can view their details in one place; and simplifying how tax liabilities are assessed and calculated.

It also argues that obligations and processes across different taxes should be as consistent and simple as possible, and should serve to simplify the tax system as a whole.

Commenting on the issue, John Barnett, Chair of the CIOT's Technical Policy and Oversight Committee, said: 'The UK's tax system is creaking at the seams and this thorough review of the administration framework is long overdue.

'Many of the problems with tax administration are to do with HMRC's processes, systems, communications and guidance. These are just as important as the statutory rules and structures. We believe significant progress is achievable by making improvements in these areas, including to HMRC's service standards, to help reduce burdens on taxpayers and build trust in the tax system.'

19thJul
News article

CBI calls for urgent solution to 'crippling staff shortages'

The government must make immediate changes to the current self-isolation policy as businesses face 'crippling staff shortages', according to the Confederation of British Industry (CBI).

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The government must make immediate changes to the current self-isolation policy as businesses face 'crippling staff shortages', according to the Confederation of British Industry (CBI).

Over 500,000 people were notified by the NHS test-and-trace app last week.

The CBI has called for the government not to wait until 16 August but immediately allow double-jabbed individuals to avoid self-isolating for ten days.

It also called for clearer communication from the government around future country categorisation changes to help support the international travel sector, together with ramping up efforts for 100% full adult vaccination.

Lord Karan Bilimoria, President of the CBI, said: 'With restrictions being lifted and cases rapidly increasing, we urgently need a surefooted approach from government, creating confidence to secure the recovery.

'This starts by immediately ending the self-isolation period of ten days for people who are double-jabbed and providing a route out of isolation for those not yet fully vaccinated through daily lateral flow tests. Against the backdrop of crippling staff shortages, speed is of the essence.'

16thJul
News article

Over 40% of UK employers planning to increase investment in skills

More than 40% of UK employers are planning to increase investment in training compared with pre-COVID levels, according to the 2021 Confederation of British Industry (CBI)/Birkbeck, University of London Education and Skills Survey.

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More than 40% of UK employers are planning to increase investment in training compared with pre-COVID levels, according to the 2021 Confederation of British Industry (CBI)/Birkbeck, University of London Education and Skills Survey.

The survey, which was completed by 252 respondents, shows how businesses are responding to accelerating changes to work.

It showed that over the next three to five years companies expect to have greater need for people with skills at all levels.

Employers most expect the need for other workplace skills unattached to qualifications – such as communication and teamwork - to increase. However, respondents are the least confident about meeting these skills needs.

The CBI Education & Skills Survey is published against a backdrop of many companies struggling to fill vacancies, as the economy reopens rapidly from the pandemic.

Matthew Fell, CBI Chief UK Policy Director, said: 'Firms are currently facing a perfect storm of staff shortages worsened by rising levels of self-isolation. They're taking immediate steps to resolve this, investing in skills and automation and strengthening inclusion. But the Government needs to play its part too on skills and immigration.

'To support individuals to gain new skills, the government should make flexible, bitesize training more accessible before the Lifelong Learning Entitlement is introduced in 2025.

'Building closer local links between employers and education providers will also be key to supporting every UK region and nation to thrive and ensuring our economy can fire on all cylinders.'

15thJul
News article

Job vacancies increase to over pre-pandemic levels

There are more job vacancies now than there were before the pandemic, according to the Official for National Statistics (ONS).

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There are more job vacancies now than there were before the pandemic, according to the Official for National Statistics (ONS).

ONS figures also show that unemployment is now falling after a year of job losses.

The number of open jobs between April to June 2021 was 77,500 above its pre-pandemic level in January to March 2020, says the ONS.

There were 862,000 job vacancies between April and June, the highest figure in 15 months.

Meanwhile, unemployment fell slightly between March and May 2021, according to official figures, with an increase in both the employment and the number of hours worked.

However, the UK's unemployment rate is currently 4.8%, still 1% higher than before the pandemic began, the ONS added.

Matthew Percival, Director for People and Skills at the Confederation of British Industry (CBI), said: 'Vacancies exceeding pre-COVID levels is a further sign of demand returning and employers creating jobs.

'Yet businesses' ability to meet this demand, and support the recovery, is being challenged by staff shortages. As COVID cases rise, firms are facing the double difficulty of hiring workers and more employees self-isolating.'

14thJul
News article

High Street sales bounce back in spring

Retail sales bounced during the spring with the quarter from April to June showing record growth, according to the latest figures from the British Retail Consortium (BRC).

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Retail sales bounced during the spring with the quarter from April to June showing record growth, according to the latest figures from the British Retail Consortium (BRC).

Sales in the second quarter of 2021 rose 28.4% from a year previously and were up 10.4% from 2019.

June's sunny weather and the Euro 2020 football tournament helped to boost trade, the BRC said.

But the BRC warned that many retailers still faced 'strong headwinds' as the UK economy recovers from the pandemic.

In June, fashion and footwear did well, while the start of the Euro 2020 football championship provided a boost for TVs, snack food and beer.

BRC Chief Executive Helen Dickinson said: 'The second quarter of 2021 saw exceptional growth as the gradual unlocking of the UK economy encouraged a release of pent-up demand built up over previous lockdowns.

'In June, while growth in food sales began to slow, non-food sales were bolstered by growing consumer confidence and the continued unleashing of consumer demand.

'With many people taking staycations, or cheaper UK-based holidays, many have found they have a little extra to spend at the shops, with strong growth in-store in June.'

13thJul
News article

Government urged to provide more clarity over reopening

The government has been urged to provide more clarity and further guidance after it confirmed that most lockdown restrictions will end in England on 19 July.

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The government has been urged to provide more clarity and further guidance after it confirmed that most lockdown restrictions will end in England on 19 July.

Business groups said that their members welcomed the reopening, which brings great relief.

However, as businesses begin living with and managing COVID-19 they asked the government to do more.

Claire Walker, Co-Executive Director of the British Chambers of Commerce, said: 'Business leaders aren't public health experts and cannot be expected to know how best to operate when confusing and sometimes contradictory advice is coming from official sources.

'Without clear guidance there?could be real uncertainty on how companies should operate from 19 July and what they should be doing to keep staff and customers safe.'??

Mike Cherry, National Chair of the Federation of Small Businesses (FSB), said: 'We want all small businesses and their customers to feel safe in how they shop and operate, and this includes allowing small businesses the space to make the right decisions about their premises. 

'We cannot allow removing legal guidance to create a free for all, with any voluntary guidance ignored, which is why it is vital that clarity around the new state of play is given immediately.'

Matthew Fell, Chief UK Policy Director at the Confederation of British Industry, said: 'The government can play a pivotal role in setting new norms, starting with fresh workplace guidance, encouraging the use of public transport and continuing support for workplace testing.'

12thJul
News article

International tax reform backed by 130 countries

An historic deal for a global corporate tax rate of at least 15% has been agreed by 130 countries, the Organisation for Economic Co-operation and Development (OECD) has announced.

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An historic deal for a global corporate tax rate of at least 15% has been agreed by 130 countries, the Organisation for Economic Co-operation and Development (OECD) has announced.

According to the OECD, the agreement will ensure an extra $150 billion in taxes is paid by large corporations annually.

It will also mean that $100 billion of profits will be reallocated each year to countries in which the corporations earn profits, but where they are not currently taxed.

The OECD plans to have the rules in place next year, to be implemented in 2023.

It has spent more than a decade negotiating the two-pillar package, pushing for multinational enterprises to pay tax where they operate and earn profits.

The OECD said it would add 'much-needed certainty and stability to the international tax system'.

Mathias Cormann, Secretary-General of the OECD, said: 'After years of intense work and negotiations, this historic package will ensure that large multinational companies pay their fair share of tax everywhere.

'This package does not eliminate tax competition, as it should not, but it does set multilaterally agreed limitations on it. It also accommodates the various interests across the negotiating table, including those of small economies and developing jurisdictions.'

9thJul
News article

HMRC publishes guidance on the fifth SEISS grant

Full details of the fifth Self-employment Income Support Scheme (SEISS) grant, including a new turnover test which determines the level of the grant, have now been published by HMRC.

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Full details of the fifth Self-employment Income Support Scheme (SEISS) grant, including a new turnover test which determines the level of the grant, have now been published by HMRC.

The key change from the previous SEISS grant is that the level of the grant depends on whether turnover has dropped by more or less than 30%.

The fifth grant is 80% of three months' average trading profits, capped at £7,500 for those whose turnover has reduced by 30% or more. Those with a turnover reduction of less than 30% will receive a grant based on 30% of three months' average trading profits, capped at £2,850.

To be eligible for the grant, an individual must be self-employed or a member of a partnership. They must have traded in the tax year 2019/2020 and submitted their tax return on or before 2 March 2021, and also have traded in the tax year 2020/21.

They must be currently trading but be impacted by reduced demand due to coronavirus (COVID-19), or have been trading but are temporarily unable to do so due to COVID-19.

Claimants will need to provide two turnover figures during the claims process: one from the pandemic period and an earlier reference period.

For further details please see HMRC's guidance.

8thJul
News article

Average losses from pensions scams now over £50,000

The average loss from pension scams has reached £50,949 this year, according to the latest figures from Action Fraud.

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The average loss from pension scams has reached £50,949 this year, according to the latest figures from Action Fraud.

That is more than double the typical figure of £23, 689 reported last year.

Action Fraud said the losses in each case ranged from less than £1,000 to as much as £500,000, and the real figures could be higher as many scams go unreported.

Mark Steward, the Executive Director of Enforcement and Market Oversight at the Financial Conduct Authority (FCA), said: 'Fraudsters will seek out every opportunity to exploit innocent people, no matter how much they have saved.

'Check the status of a firm before making a financial decision about your pension by visiting the FCA register. Make sure you only get advice from a firm authorised by the FCA to provide advice, before making any changes to your pension arrangements'

The FCA highlighted five common warning signs:

  • Being offered a free pension review out of the blue
  • Being offered guaranteed higher returns
  • Being offered help to release cash from your pension, even though you are under 55
  • High-pressure sales tactics - scammers may try to pressure you with 'time-limited offers' or send a courier to your door to wait while you sign documents
  • Unusual investments which tend to be unregulated and high-risk.

More information on pension scams is available from the FCA.