- Advisory fuel rates for Company Cars
- Tax refund scams warning from HMRC
- 200,000 receive back page as HMRC enforces National Minimum Wage
- GDPR
- Making Tax Digital
- Tax Changes
- Employer-Supported Childcare gets a reprieve
Advisory fuel rates for Company Cars
The new company care ‘Advisory fuel rates’ have been published and will take effect from 1 June 2018. You can use the previous rates for up to one month from the date the new rates apply. The below rates only apply to employees using a company car.
| Engine Size | Petrol – amount per mile | LPG – amount per mile |
| 1400cc or less | 11 pence | 7 pence |
| 1401cc to 2000cc | 14 pence | 9 pence |
| Over 2000cc | 22 pence | 14 pence |
| Engine Size | Diesel – amount per mile |
| 1600cc or less | 10 pence |
| 1601cc to 2000cc | 11 pence |
| Over 2000cc | 13 pence |
These rates only apply when you:
- Reimburse employees for business travel in their company cars
- Require employees to repay the cost of fuel used for private travel
- https://www.gov.uk/government/publications/advisory-fuel-rates/advisory-fuel-rates-from-1-march-2016
- https://www.gov.uk/government/publications/advisory-fuel-rates/when-you-can-use-advisory-fuel-rates
Tax refund scams warning from HMRC
There are scams targeting individuals via email and SMS Messages. HMRC have issued a warning to try and prevent this.
Genuine tax refunds for 2017/18 are currently being processes however fraudsters have already starting sending scam message claiming that taxpayers are entitled to a rebate. If you were to go deeper into the scam message it will request that you provide your personal account details to make the claim.
HMRC has stressed the importance that any tax refunds will only be communicate by post or through an employer, never via email, text messages or voicemail.
HMRC are therefore advising all taxpayers to not click on any links, download any attachments or to provide any personal information. Any suspected messages should be forwarded on to HMRC on
phishing@hmrc.gsi.gov.uk and texts to 60599, or contact Action Fraud on 0300 123 2040 to report any suspicious calls or use its online fraud reporting tool https://www.actionfraud.police.uk/report_fraud
For more information visit: https://www.gov.uk/government/news/hmrc-warns-on-tax-refund-scams
200,000 receive back page as HMRCC enforces National Minimum Wage
The department for Business. Energy & Industrial Strategy and HMRC have launch a campaign urging underpaid workers to complain as figures show that the numbers of workers getting the money they’re owed has doubled.
HMRC identified £15.6 million in pay owed to more than a record 200,000 of the UK’s lowest paid workers from 2017 to 2018. This has increased from £10.9million for more than 98,000 workers last year.
An online complaints service started in January 2017 which has contributed to the 132% increase in the number of complaints received and the money HMRC has been able to recoup for those unfairly underpaid.
The online service is a quick and easy way for anyone with concerns about not being paid the National Minimum Wage to report an employer or former employer anonymously.
Industries most complained about to HMRC included restaurants, bars, hotels and hairdressing.
GDPR
To ensure that the laws overseeing our personal data are fit for purpose, new rules have been created. The agreed General Date Protection Regulation (GDPR) which will replace the current Data Protection Act will come into force on May 25, 2018. The new law will result in changes to the way businesses and public-sector organisations handle sensitive information from their customers.
There are two-types of Personal Data:
Personal Data can be anything that allows a living person to be directly or indirectly identified (name, address or even an IP address)
Sensitive Personal Data: These includes a person’s trade union membership, religious belief, political opinions and racial information.
GDPR has been placed to help safeguard personal data with emphasis on transparency and accountability. If an organisation does not process an individual’s data the correct way, they can be fined. They can also be fined if there is a security breach.
GDPR states smaller offences could results in fines of up to $10 million or 2 per cent of a firm’s global turnover (whichever is greater). Those with more serious consequences can have fines of up to $20 million or 4 per cent of a firm’s global turnover (whichever is greater).
Making Tax Digital
Making Tax Digital for VAT (MTDfv) will be required from 1 April 2019. Pilot for MTDfv is in place, allowing for a year of testing before any businesses are mandated to use the system.
Business with an annual turnover exceeding £85,000 will have to maintain digital records for VAT purposes and provide their VAT return information to HMRC using MTD compatible software’s starting from 01 April 2019. If the business turnover drops to below £85,000 the business must continue to make MTD reports until it deregisters from VAT.
Any VAT registered business with a turnover of less than the VAT threshold, who have voluntarily registered are not obligated for MTD and will carry on with their usual method of submission unless they wish to opt in.
Keeping digital records and making quarterly updates will not be mandatory for taxes other than VAT before April 2020.
HMRC will not provide any free software’s to allow businesses to comply with their MTD obligations. All businesses will be expected to us commercial software or to develop their own in-house bespoke software to comply with MTD.
Any business that use bespoke software’s will need to register with HMRC as a software developer to gain access to the application programming interface (API) to write into their own bespoke software.
Tax Changes
National Living Wage Rise
The national living wage has increased from April 2018, therefore employers need to make sure that they are up to date with the current rates.
The rate applicable will depend on the worker’s age and if they are an apprentice. If HMRC find the employer has not paid they will send them a notice for the arrears plus a fine for not paying the minimum wage.
Personal Allowance on the up
We all have a ‘personal allowance’ which denotes the amount we can earn without paying any income tax. If you earn more than your personal allowance, then you pay tax at the applicable rate on all earnings above the personal allowance, but the allowance itself will remain untaxed.
Pensions
From April 2018, workers who have auto-enrolment pensions will have to pay more into this, with monthly contributions rising from a minimum of one per cent to a minimum of three per cent.
Student Loan tweaks
There are two types within the Student Loan Plan.
Plan 1
The annual threshold for the year 2018-19 is £18,330 as opposed to £17,775 for 2017-18.
Plan 2
You will have to start repaying your student loan once your income exceeds the £25,000 threshold. Previous threshold was £21,000.
Dividend Tax
The first £5000 of the dividend allowance in 2017/18 was tax free. This has changed from 06 April 2018, where the tax free dividend allowance has been reduced to £2000. Any dividends received above the allowance are taxed at the following rates:
7.5% for basic rate taxpayers
32.5% for higher rate taxpayers
38.1% for additional rate taxpayers
Employer-Supported Childcare gets a reprieve
Many employers help employees with childcare costs, often by providing childcare vouchers by way of salary sacrifice. Following the roll out of Tax-Free Childcare (TFC), the new government scheme to help working parents, existing Employer-Supported Childcare (ESC) schemes were expected to close to new joiners from April 2018.
However following the Chancellor’s Spring Statement, Education Secretary Damian Hinds, made a concession to delay scrapping the scheme by six-months.
The childcare choices website which provides useful guidance to parents on the childcare options available to them including ESC, TFC and other free entitlements has been updated to show that childcare vouchers will be available to new joiners until the end of September 2018. Under the rules employees already using ESC can choose whether to remain in the existing scheme or switch to TFC, but parent cannot be in both TFC and ESC at the same time.
