From the end of October HMRC will begin issuing letters to people who earn over £50,000 and live at an address where child benefit is received. The letter will explain how the changes in the child benefit system will affect the taxpayer. From January 2013 those earning in excess of £50,000 will still be entitled to child benefit on a sliding scale up to £60,000. Beyond that the child benefit will be reduced to nil through a new tax charge.
From 1 October 2012 the National Minimum Wage increases from £6.08 per hour to £6.19 per hour for a worker aged 21 and above. The 18 to 20 year old rate remains the same at £4.98 per hour as does the under 18 rate at £3.68 per hour. The apprentice rate has increased from £2.60 per hour to £2.65 per hour.
HMRC has recently announced that approximately 6 million taxpayers are due tax refunds averaging £400 each, while another million will face tax underpayment notices of approximately £600 each. This relates to the tax year 2007-08 and earlier.
If you receive an underpayment notice firstly check that the facts are correct such as sources of income for that tax year. Then look at the information that HMRC would have had at the time to determine your PAYE code for that tax year. It may be that in very specific circumstances an appeal under Extra Statutory Concession A19 may be appropriate.
If you receive an underpayment notice and wish to discuss the situation further then please let us know.
The deadline for confirming your income for 2010/11 for tax credit purposes is Sunday 31 July 2011. If taxpayers are not in a position to confirm their actual income for tax credit purposes by this date an estimated declaration should be made . This can then be finalised once your income is actually calculated for 2010/11. If a declaration is not submitted on time your tax credit entitlement may be effected and potentially stopped.
HMRC has incurred delays in sending out self assessment statements to tax payers in anticipation of the July instalments. Any tax payers who do not have a payslip and wish to pay by cheque can download from the HMRC website form SA361. This emergency payslip will be made available until mid August. Alternatively payments can be made by internet banking or over the telephone. Please remember that payments made to HMRC and not cleared by 31 July will incur interest charges for late payment.
Initial feedback from the first trial checks carried out by HMRC on business records indicate that they are looking at:
As these initial checks on tax payers’ records were carried out on a trial basis no mention of penalties was made.
Follow up letters sent out to the business proprietor indicated that HMRC may check again within three months to see if their recommendations had been followed.