A rolling summary of key news in recent months for advisers.

Current consultations affecting business:

Working with Dishonest Tax Agents

HMRC is proposing measures which this time contain proportionate safeguards in a new discussion document.

Capital allowances on fixtures: new pooling and notification

If you have ever bought or sold an interest in commercial property your advisers should have alerted you to the tax consequences of the special capital allowances rules for fixtures. Unfortunately many sellers and buyers have been ill informed and this has created a market in hunting "lost" fixtures. This new consultation aims to try to standardise record keeping and claims. "A marketing opportunity; get writing to clients and claim those lost fixtures now"...More

There are also consultations on out on:

  • Venture capital reliefs
  • Capital allowances anti-avoidance (connected parties, sale and leaseback, etc)
  • Capital allowances on the feed in tariff and renewables
  • Tax relief on Gifts of pre-eminent chattels to the nation.

EBTs and disguised remuneration schemes

HMRC has revised and updated its Q & A on Disguised Remuneration.

It says that these will be added into comprehensive guidance which will be published shortly after the legislation has been enacted in Finance (no 3) Bill.


Writing to HMRC? New addresses

HMRC have a new system where there are two default addresses in use for SA, CGT and PAYE, however, read this guide first to decide which one to use.

HMRC postal delays

If you experience postal delays from HMRC retain the envelope it contains a bar code and this will allow HMRC to locate the postal office causing the delay.


HMRC have launched a new compliance pilot. The Single Compliance Process (SCP) builds on the earlier cross tax and interventions pilots; it aims to create a more efficient enquiry process. The pilot will run from June 2011 to December 2011 from 12 locations.

Disclosure initiatives


Businesses who have been trading above the VAT threshold and have not registered for VAT are being offered the chance to catch up and a reduced 10% tax penalty will apply. Under HMRC's new VAT initiative campaign they need to apply to HMRC by 30 September and make their application by 31 December 2011.

Plumbers Tax Safe Plan

Those taking part in this initiative (it is open to everyone) are required to make their disclosure by 31 August 2011.

Tax agents

Tax Agents consultation

HMRC has launched a new consultation on working with Tax Agents. It proposes a new self-serve facility for agents. A second consultation on penalties for dishonest agents is expected sometime in the Autumn.

Agent Account Managers

Tax agents can now register in order to obtain their own "fairy godmother" at HMRC. The AAMs offer assistance and support when normal lines of communication fail.

Agent update

HMRC has just published Agent Update 24.

Forms and penalties

Collection of tax debts

From 20 July 2011 the PAYE regulations will permit a deduction for a tax debt of up to £3,000 (previously £2,000) to be made from a payee's income without the payee's consent. Codings can be adjusted from 6 April 2012.

PAYE - P45 & P46

  • All employers are required to file these in year and online.
  • Large employers are being fined from 6/1/2011, small employers can expect a failure to produce a warning letter from HMRC to get your systems in place, and a fine after 6/1/2012.


  • Form P11D and P11D(b) submission deadline: 6 July. Click here for details of penalties
  • Payment date of Class 1 A NIC: 19 July following the tax year (22 July if paid electronically) unless business ceases.
  • Payment rate for Class 1A NICs is 12.8% (as you are paying for 2010/11) - reminder issued by the ICAEW.
  • If business ceases the last payment is due 14 days after the end of the final tax month of trading.

Form 42 reporting and employee share schemes

Share scheme forms (including EMI) were due by 6 July

  • HMRC suspended the facility to file returns online from 1 April 2010, as part of an overhaul of its IT infrastructure. This means the annual share scheme returns can only be submitted in paper format using the prescribed form, and will not be accepted on compact discs, other electronic media or any other format.

  • Self assessment
  • SA tax returns are now subject to the new system of tax penalties: failure to make a return (late filing).

  • Increased tax-geared penalties apply in relation to errors and failures relating to offshore income and capital gains.

  • Class 2 NICs payment dates are now moving to 31 January and 31 July, the same as a Self Assessment tax - watch out if you are ceasing trading.

Corporation tax

Associated companies

The new rules for associated companies apply for periods ending on or after 1 April 2011.

ESC C16 - what now?

No new developments to report since the consultationto remove it in December 2010. The extra statutory concession is still alive and well according to HMRC's last published list of concessions.

Online filing

iXBRL and detailed profit and loss accounts

DIY tagging or a PDF? some software will not tag a detailed P & L account as it is not included in the minimum version of the UK GAAP taxonomy...More

HMRC CT software

HMRC has announced that its Corporation Tax software cannot be used for filing returns for accounting periods ending on or after 1 April 2011 until it is upgraded in October 2011.

Feedback from agents


HMRC's new computer is working better than before but there are still coding problems - particularly where there are two sources of low earnings. Don't stop checking codings.

International issues

French property tax

The French have decided not to introduce a new property tax for non-residents on 1 Jan 2012. Brits who hold property in France through a SCI company will still need to reconsider their tax affairs as tax relief on shareholder loans to SCIs ends on 1 Jan 2012, this may bring many property owners into the charge for French Wealth tax from that date on.

Consultations - (these all link directly to HMT or HMRC):

Integrating the operation of income tax and National Insurance contributions: a call for evidence

Open date: 11 July 2011
Close date: 19 September 2011  

The Government has issued a call for evidence as part of its consideration of the integration of the operation of the income tax and National Insurance contributions systems, announced at Budget 2011. The Government believes that greater integration of the two has the potential to remove economic distortions, reduce burdens on business, and improve fairness for individual earners.

Tax-advantaged venture capital schemes: a consultation

Open date: 06 July 2011
Close date: 28 September 2011

The aim of this consultation is to gather views and evidence from stakeholders on a new scheme for seed investment the Business Angel Seed Investment Scheme (BASIS) and on a number of reform options to improve the effectiveness of the EIS and VCTs. The document is organised around three main themes:

  • additional support for seed investment via the creation of a new scheme;
  • simplification of the current schemes; and
  • refocusing of the current schemes to ensure they remain appropriately targeted.

The Government also announced at Budget that feed-in tariff (FITs) businesses would be added to the excluded activities list from 6 April 2012.

Bringing HMRC's information powers into line with international standards (link not active at present).
Issue date of consultation: 7 July 2011
Date of response: 29 September 2011
This consultation is on an amendment to Schedule 36 Finance Act (FA) 2008 to bring HMRC’s information powers into line with the international standard for the exchange of information for tax purposes. It concerns ways to ensure that HMRC can collect information in specific cases where the full identity of the taxpayer is not known but can be ascertained by reference to other available information.

Reform of the taxation of non-domiciled individuals
Issue date of consultation: 17 June 2011
Date of response: 9 September 2011
This consultation seeks views on the detailed policy design of the changes announced at Budget 2011 to the taxation of non-domiciled individuals. The Government welcomes views from individuals, business advisers, businesses and representative bodies who are affected by, or have an interest in, the rules on non-domicile taxation.

Statutory residence test
Issue date of consultation: 17 June 2011
Date of response: 9 September 2011
This consultation proposes the introduction of a statutory definition of tax residence for individuals and seeks views on the design and implementation of the framework for such a definition. As part of this consultation, the Government is also seeking views on options to reform the concept of ordinary residence.