ddd8ae2d db0b 4e5c ae00 de940e3e2066 800x380 - Budget date announced

Budget date announced

The Chancellor of the Exchequer, Rishi Sunak has confirmed that the next UK Budget will take place on Wednesday, 3 March 2021. This will be the Chancellor’s second Budget and will focus on delivering the next phase of the plan to tackle the virus and protect jobs. The timeline for delivering Budgets has seen much change over the last few years as the government has been dealing with Brexit related issues and then with the coronavirus pandemic.

This will be the first Budget following the UK’s trade deal with the EU and we may see many new measures being announced. Details of all the Budget announcements will be made on a special section of the GOV.UK website which will be updated following completion of the Chancellor’s speech in March.

The Budget will be published alongside the latest forecasts from the Office for Budget Responsibility (OBR. The OBR has executive responsibility for producing the official UK economic and fiscal forecasts, evaluating the government’s performance against its fiscal targets, assessing the sustainability of and risks to the public finances and scrutinising government tax and welfare spending.

Source: HM Treasury Wed, 06 Jan 2021 00:00:00 +0100
8971877f 022e 4b95 aad8 1539748b2ed3 800x380 - Help to Save bonuses

Help to Save bonuses

The Help to Save scheme was launched by the government in September 2018 to help those on low incomes to boost their savings. Under the scheme, those eligible could save between £1 and £50 every calendar month and receive a 50% government bonus. The 50% bonus is payable at the end of the second and fourth years and is based on how much account holders have saved.

The first bonus payment has now been paid to savers who created an account and started saving money two years ago. The bonus is paid directly into the account holder’s chosen bank account.

New figures published by HMRC show that more than 60,400 savers have earned their first Help to Save bonus payment, each receiving an average of £378. This means that over £22.8 million in bonuses has been paid to date. The North West had the highest number of savers who have paid into their accounts and received their first bonus payment whilst savers in the South West received the highest average bonus payment, followed by savers in Greater London.

Account holders can continue saving under the scheme for a further two years and receive another final bonus at the end of four years. This could see those on low incomes receive a maximum bonus of up to £1,200 on savings of £2,400 for 4 years from the date the account is opened. The scheme is open to most working people who receive Working Tax Credits or Universal Credit.

Source: HM Revenue & Customs Wed, 30 Dec 2020 00:00:00 +0100
f4f97ef8 4180 40cb a567 5ecea9af16d1 800x380 - Child Trust Fund court fees waived

Child Trust Fund court fees waived

Children born after 31 August 2002 and before 3 January 2011 were entitled to a Child Trust Fund (CTF) account provided they met the necessary conditions. These funds were long term saving accounts for newly born children. The first of these children who qualified began turning 18 years of age from 1 September 2020.

For most young adults, the process is straightforward. However, if a young person lacks mental capacity and as a result cannot handle their finances, a parent or guardian must apply to the Court of Protection to allow them to manage these funds. This ensure that vital safeguards for vulnerable young people remain in place.

A new fee remission, to waive court fees, can be granted to parents or guardians of children who lack mental capacity when seeking access to a Child Trust Fund. The issue mainly arises when an application to the Court of Protection is made after the account holder’s 18th birthday. The Ministry of Justice (MOJ) is therefore strongly encouraging families to make an application before the dependant’s 18th birthday. The MOJ and HM Treasury are working with CTF providers to ensure parents are aware of this and will also work to issue refunds to those who have already paid court fees.

Around 6.3 million CTF accounts have been set up since the scheme was launched in 2002, roughly 4.5 million by parents or guardians and a further 1.8 million set up by HMRC where parents or guardians did not open an account.

Source: HM Revenue & Customs Wed, 30 Dec 2020 00:00:00 +0100
14124e07 cf4b 4205 80f8 194809616b24 800x380 - Internal Market Bill becomes law

Internal Market Bill becomes law

The UK Internal Market Act 2020 received Royal Assent on 17 December 2020 and came into force on 1 January 2021 following the end of the Brexit transition period. The new Act ensures that businesses can continue to trade seamlessly across all four parts of the UK as the EU’s internal market rules have come to an end. 

The UK Internal Market Act 2020 establishes 2 principles (the Market Access Principles) that apply to goods and services, ensuring the UK's shared internal market continues to operate effectively:

  • the principle of mutual recognition (MR) ensures regulations from one part of the UK are recognised across each of the others
  • the principle of non-discrimination (ND) supports companies trading in the UK, regardless of where in the UK they are based, by preventing unreasonably discriminatory regulation

It has also been confirmed that a new Office for the Internal Market (OIM) will monitor the running of the UK Internal Market. The OIM will provide independent, technical advice to all four administrations and their legislatures and sit within the Competition and Markets Authority. The OIM will began operating later in 2021, once the appointments process has been completed by the Business Secretary.

While the appointments process takes place, the government will continue to monitor and protect the UK’s internal market in cooperation with the devolved administrations.

Source: Department for Business, Energy & Industrial Strategy Wed, 30 Dec 2020 00:00:00 +0100
a2d04999 1381 4086 b331 2ab8fc72d6ce 800x380 - Outcome of EU trade negotiations

Outcome of EU trade negotiations

Despite many expectations to the contrary, the Prime Minister, Boris Johnson announced on Christmas Eve that the UK and EU had agreed an EU trade deal after four and a half years of strenuous negotiations. This is the first agreement the EU has ever reached allowing zero tariffs and zero quotas and went into effect at 11pm on 31 December 2020. This means there will be no tariffs or quotas on the movement of goods we produce between the UK and the EU and covers some £660 billion of trade.

The agreement also includes provisions to support trade in services (including financial services and legal services) and helps support the mobility of UK professionals. The UK and EU also finally settled other contentious issues including UK sovereignty over fishing waters and continued co-operation on law enforcement. The agreement also removes the role of the European Court of Justice and means there are no requirements for the UK to continue following EU law. This returns control of legal power to the UK with laws being made by Parliament and interpreted by the UK courts. The details of the 1,246 page agreement continue to be pored over by interested parties.

The government has committed to continue meeting high labour environment and climate standards and to develop a modern subsidy system to replace EU State Aid.

Source: HM Government Wed, 30 Dec 2020 00:00:00 +0100
e3a32b13 917c 4191 8868 fd425ad6880d 800x380 - HMRC crackdown on avoidance schemes

HMRC crackdown on avoidance schemes

HMRC and the Advertising Standards Authority (ASA) have come together to jointly target misleading marketing by promoters of tax avoidance schemes. HMRC and the ASA can jointly issue an Enforcement Notice to companies irresponsibly advertising tax arrangement schemes in a bid to clamp down on those breaking the rules.

The ASA is clear that advertisers are required to ensure that their marketing communications are legal, comply with the law and do not incite anyone to break it.  As such, ads for any arrangements or schemes which are illegal will break the ad rules as well as the law.

HMRC has also launched a new campaign titled ‘Tax avoidance: don’t get caught out’ warning and educating contractors about how to identify if they are being offered a tax avoidance scheme, and the pitfalls of using these schemes. The campaign urges taxpayers to help avoid unwittingly entering into arrangements that HMRC are likely to be seen as tax avoidance.

The campaign is asking the public to:

  • stop – don’t sign anything that you are uncomfortable with or don’t understand
  • challenge – check for warning signs. If you’re unsure, seek independent professional advice
  • protect – if you think you have been offered a tax avoidance scheme, report it to HMRC. Or if you need help getting out of one, contact us.

For example, a number of schemes have targeted workers returning to the National Health Service (NHS) to help respond to the coronavirus (COVID-19) outbreak.

Source: HM Revenue & Customs Wed, 09 Dec 2020 00:00:00 +0100
39206d74 d7bd 4842 80ac 64ac7595abe9 800x380 - Beware requests from bogus charities

Beware requests from bogus charities

It has been estimated that almost £350,000 of charitable donations last year ended up in the pockets of criminals.

Government recently issued advice to reduce this activity. They said:

The vast majority of fundraising appeals and collections are genuine, however criminals can set up fake charities, or even impersonate well-known charitable organisations, to deceive victims.

Action Fraud has teamed up with the Charity Commission, the regulator and registrars of charities, and the Fundraising Regulator, the independent regulator of charitable fundraising in England, Wales and Northern Ireland, to help the public make sure their donations go to the right place this Christmas.

Clearly, this bogus activity represents just a small proportion of overall donations made to reputable charities, but donors should be wary. Further advice to donors included in their press release says:

  • Make sure the charity is genuine before giving any financial information. Look for the registered charity number on their website. You can check the charity name and registration number at www.gov.uk/checkcharity;
  • You can also check if a charity is registered with the Fundraising Regulator. All charities registered here have made a commitment to good fundraising practice;
  • If you’re approached by a collector on the street or at your door, ask to see the collector’s ID badge. You can also check whether the collector has a licence to fundraise with the local authority, or has the consent of the private site owner;
  • Don’t click on the links or attachments in suspicious emails, and never respond to unsolicited messages and phone calls that ask for your personal or financial details – even if it’s in the name of a charity
  • To donate online, type in the address of the charity website yourself rather than clicking on a link. If in any doubt, contact the charity directly about donating;
  • Be cautious when donating to an online fundraising page. Fake fundraising pages will often be badly written or have spelling mistakes. When donating to an online fundraising page, only donate to fundraising pages created by someone you know and trust.

After making these checks, if you think that a fundraising appeal or collection is fake, report it to Action Fraud online or by calling 0300 123 2040.

Source: Other Mon, 07 Dec 2020 00:00:00 +0100
5a594638 b8b1 4be0 ac62 ee45c70afa8d 800x380 - Beware tax deadline scammers

Beware tax deadline scammers

Fraudsters are continuing to target taxpayers with scam emails in advance of the 31 January deadline for submission of Self-Assessment returns.  In fact, over the last year, HMRC received more than 846,000 reports about suspicious HMRC contact. 

A number of these scams purport to tell taxpayers they are due a tax rebate or tax refund from HMRC and ask for bank or credit card details in order to send the refund. The fraudsters use various means to try and scam people including making contact by phone calls, texts or emails. In fact, fraudsters have been known to threaten victims with arrest or imprisonment if a bogus tax bill is not paid immediately.

HMRC’s dedicated Customer Protection team to identify and close down scams but is advising customers to recognise the signs to avoid becoming victims themselves. For example, genuine organisations like HMRC and banks will never contact customers asking for their PIN, password or bank details.

If you think you have received a suspicious call or email claiming to be from HMRC you are asked to forward the details to phishing@hmrc.gov.uk and texts to 60599. If you have suffered financial loss you should contact Action Fraud on 0300 123 2040 or use their online fraud reporting tool.

Source: HM Revenue & Customs Wed, 25 Nov 2020 00:00:00 +0100
af2700e3 7a14 4217 bb86 8a308f7a7e44 800x380 - Spending Review 2021/22

Spending Review 2021/22

The Chancellor, Rishi Sunak delivered the government's spending plans for the coming year to Parliament on 25 November 2020. The Spending Review usually covers 3 to 4 years but given the many unknowns as a result of the pandemic the review will only cover the period from April 2021 to April 2022.

The Chancellor said his immediate priority was to protect people’s lives and livelihoods as the country continues to battle the outbreak – allocating £55 billion to tackle the virus next year.

Plans were also announced for increased infrastructure spending with £100 billion of capital spending next year and a £4 billion Levelling Up Fund. As expected, it was also announced that there will be a public sector pay freeze with an exemption for the NHS and for public sector workers who earn below the median wage of £24,000.

The Chancellor also used the Spending Review to confirm that increased National Minimum Wage and National Living Wage rates will come into effect on 1 April 2021.

From 1 April 2021 the National Living Wage will increase by 19p to £8.72. This represents an increase of 2.2%. The National Living Wage currently applies to those aged 25 and over but from next April will be extended to 23 and 24 year olds for the first time. There will also be increases to the National Minimum Wage and other wage rates for younger people. The new rates mirror the recommendations made by the Low Pay Commission which have been accepted in full by the government.

Source: HM Government Wed, 25 Nov 2020 00:00:00 +0100
d50774f5 803d 406f a9fa 2458c58c283d 800x380 - Scottish Budget 2021

Scottish Budget 2021

Scotland’s Finance Secretary, Kate Forbes, has announced that the Scottish Government’s Budget will be published for 2021-22 on 28 January 2021. The date has been selected in order to allow the Scottish Government time to prepare for the new tax year.

This is the second time that Scotland has held a Budget before the rest of the UK. The announcement follows the UK Government’s decision to postpone its Autumn Budget until an unspecified date in the new year.

The Finance Secretary commented that:

‘Coming amidst an unprecedented global pandemic, the forthcoming Scottish Budget will be one of the most important since devolution.

It is my task to prioritise our resources as effectively as possible to drive the country’s economic recovery from coronavirus (COVID-19) while also managing the ongoing impact of the virus.

The Chancellor’s decision to delay the UK Autumn Budget until next year causes significant difficulties for the Scottish Budget process. Although we expect to receive some funding information from the UK Spending Review on 25 November, the absence of a UK Autumn Budget means we will have to make decisions based on partial and provisional information, with no indication of potential changes to UK tax policies.

In these circumstances, and to allow us to take account of the emerging position on any EU exit deal and also the evolving situation with COVID-19, I believe it is necessary to publish the Scottish Budget 2021-22 in early 2021, rather than later this year.’

The Scottish Parliament sets the Income Tax rates and bands for non-savings and non-dividend income in Scotland. Scottish taxpayers therefore pay Income Tax at separate rates and bands to the rest of the UK on their non-savings and non-dividend income.

Source: The Scottish Government Wed, 18 Nov 2020 00:00:00 +0100