Paul Chappell's blog

HMRC have commenced notifying employers of the raising of Penalties for 2010/2011 when PAYE payments have been received late. The penalties are on a sliding scale form 1% to 4%. HMRC will not charge a penalty if there was only 1 payment late. read the full details

Employment status - is someone employed or self-employed? This is one of the main areas of uncertainty in the UK tax system and for businesses one of the most expensive areas to get wrong in terms of higher labour costs, or more worryingly unexpected back tax liabilities.
 read the full details

There are various tax implications to consider on gifts and parties that you may be providing to your employees at this time of year. The most common situations that arise are as follows
 
Cash Gifts or Bonuses
 
These are treated as normal pay and subject to PAYE and Class 1 NIC in the normal way. The important point here is that this also applies to vouchers that can be exchanged for cash
 
Gifts to Employees
  read the full details

In many cases, the new penalties will be less than what would be charged now. In particular, for new CIS contractors, there will be an upper limit to some of the penalties that are charged. This upper limit will apply when new contractors first send a monthly return, if that return and any other monthly returns that are sent at the same time, are late.
  read the full details

Something to watch out for if you are paying HMRC electronically.
 
HMRC do not use 'faster payment' which means that an electronic payment to HMRC takes 3 or 4 days to clear, and this needs to be factored in if you are making a payment by bank transfer. With electronic payment now mandatory on some taxes, and interest and penalties for late payment for others, this is a key point to bear in mind.
  read the full details

HMRC have again acknowledged there are problems with incorrect code notifications for 2010/2011.

It is recommended that all employees rigorously check notices to ensure they are correct. One alarming example is in respect of van fuel benefit. The correct charge for 2010/2011 is £550. However the notice of coding may show £1050.

HMRC have carried forward the charge for 2009/2010 of £500 and added it to the 2010/2011 charge.
  read the full details

HMRC will shortly commence the issue of notices of coding to employers for 2010/2011 on forms P9. As a result of problems encountered in January and February following HMRC's incorporation of the new PAYE computer, incorrect code notices have been issued to employees. As a result, where HMRC are aware of the problem, forms P9 will not be issued at this point. read the full details

For the first time HM Revenue and Customs are introducing monthly penalties for late payment of PAYE,NIC and CIS. The penalties are based on the number of defaults in a 12 month period. The first late payment will not incur a penalty however subsequent late payments will be penalised as follows:-
 
 read the full details

From 6 April 2010 HM Revenue and Customs are increasing the penalties incurred for the late filing of the P35/P14 forms and the P11D/P11D(b) forms.

At present the current penalty that applies to the late submission is £100 per 50 employees. HMRC are often quite late in issuing these penalties and it can often be November before HMRC start to issue penalty notices by which time your business can often already have accrued £400 of penalty.
 
The new penalty regime will be as follows:-
 
 read the full details

In the absence of a payslip are you frantically looking for information to ascertain which accounts office to send your payments to? Is it Shipley or is it Cumbernauld?
 
Paying Tax Electronically
  read the full details