November 2006 amendments

5. VAT Flat-rate Scheme (Call Sue)

This scheme can save many VAT-registered traders both time and money, but it is vital that you use the correct rate for your trade and not the one that saves the most money! Recent cases have come to light where traders have applied the wrong rate and been faced with very heavy back-tax bills, loaded further with fines and penalties. So always double-check the rate.

6. Bad news for Christmas Cheer

The EU Parliament has been challenged over the UK’s accepted rules that tax and duty are assessable on the point of supply, by considering a British-based application that goods bought over the Internet qualified as goods purchased outside this country but from another member state, and so should only be due for tax at the rate charged in that country. The application has been ruled out of order, so if you want your drink and cigarettes at the lower rates of duty and VAT charged by other member states, it means your Christmas shopping will still have to be bought over the Channel, in person. Mine’s a crate of red wine please!

7. Company Law Changes (Call Angela or Sue)

Many rules and regulations are about to change for companies, most of which will affect our limited company clients. Although allegedly these changes will reduce paperwork, you can be sure that what still remains will be rigorously enforced by HMRC – stand by for a new regime of fines – we’ll keep you posted.

End of November News.

October News Summary

1. Yet another scam.

West Midlands Police are investigating a recent scam where a card is posted through your door from a company called PDS (Parcel Delivery Service) saying that they had been unable to deliver a parcel and you should call them on 0906 6611911, which is a premium rate number. DO NOT CALL THIS NUMBER, as this is a mail scam originating in Belize. As soon as you call, you will be billed £15. If you receive a card with these details, contact Royal Mail Fraud on 020-7239 6655 or ICTIS (the premium rate service regulator) at http://www.ictis.org.uk or your local trading standards office.

2. Inland Revenue Business Support Team (call Sue)

Free seminars offered – but now over-subscribed.

3. Worker status review service. (call Sue)

As we have pointed out before, worker status is not a new law or issue, it is just that HMRC is about to get heavier over enforcement. We recently attended a presentation given by an employment lawyer, who has been reading up the bits in the new regulations that the Revenue hasn’t been publicising. A clause in the regulations will help anyone who can show they have made a proper attempt to review their workers’ status in advance of the start of the revised scheme. Basically, you need to carry out a thorough review, either via the Revenue’s website, or with someone whom the Revenue considers “Competent”. We are proud to say that we would be classified as this. We are therefore preparing a check list to use with you to review your subbies and other self-employed service providers you use (not necessarily construction workers) to be able to prepare a report on your behalf to have ready if the Revenue decide to launch a status enquiry. This would not guarantee that the Revenue will agree with our conclusions, but the lawyer concerned was of the opinion that, if such a report was on file, the Revenue would not backdate any required change in status. This should therefore avoid back-dated fines, even if the Revenue insists on your previously self-employed subbies being moved on to PAYE.

4. Is emigration really the answer?

No – nowhere to hide!

5. Agency Staff and Worker Status (call Sue)

Although agency staff should be employed on PAYE by the agency, contractors must check the agency’s agreement with them for provision of workers, and ensure that there is a clause that indemnifies them from being deemed a direct employer of the contracted worker.

6. Offshore accounts

The Revenue will be given details so tell us first.