In its response to the 'Taylor Review of Modern Working Practices', the government confirms that it has no plans to align NICs rates between the self-employed and the employed. The development of a statutory employment status test does look increasingly likely.

Following the Taylor Review we have four new consultations, these look at employment status tests, the roll of the agency (this includes a look at payday models and umbrellas), employment rights and enforcement of rights. I was surprised to find the government does not retain accurate data as to how many umbrella companies and employment intermediaries are operating in the UK. It estimates in excess of 400. Just thinking about accountancy firms, I wonder how many have spin off payroll businesses in this sector? Last week we looked at the management service company market and my thinking, given the scale of the temp market, is that there are actually thousands, not hundreds of employment intermediaries of various different descriptions. 

Whilst on the topic of employments, then a reminder if you have not registered your PAYE scheme yet and wish to pay yourself a salary for 2017/18. Register now. Under Real Time Information (RTI) reporting you are required to report payroll to HMRC on or before payment is made even if you are a lower earner. I keep stumbling across people who don't seem aware of this. If you are paying a salary to ensure that you have basic NICs contributions on record, then the only way that HMRC will have a record for you is via your payroll. HMRC like company directors to complete tax returns. If you have received a notice to file a tax return or need to notify chargeability and you have received any salary you will need to have an employer PAYE reference to complete the employment section of your tax return.   

We have more on Appeals, Assessments and Reviews this week. All practical and useful stuff that we hope will make your lives easier although tax being tax, the devil is in the detail. We highlight some of our new zones in the Editor's choice. If you would like assistance in drafting an appeal or mentoring then do ask.

If you have any tax queries please do try out our Virtual Tax Partner support portal at www.VtaxP.co.uk: subscribers you are entitled to free quick queries so do ask.

Enjoy the guides and updates and the news is below. 

Back soon

Nichola Ross Martin FCA Tax Director


Your Virtual Tax Partner®: online PRACTICAL support for accountants & tax advisers BY accountants & tax advisers

Quick news (freeview)

Good Work?: Response to The Taylor Review of Modern Working Practices
The government considers how to develop proposals ‘to improve the lives of this country’s citizens’. 

Employment status: are we any closer to a statutory test?
As part of their response to the 2017 Taylor Review of Modern Working Practices the government have opened a new consultation into Employment Status.

Consultation: Agency workers recommendations
Following the Taylor Review this looks at the working practices of payroll providers, umbrella companies and how their practices affect labour and rights. It considers how to police the sector and make its activities more transparent to the workers that they engage.

Relief for First time buyers in Scotland
The Scottish government has opened a consultation into providing relief to First time buyers from Land and Buildings Transaction tax (LBTT).

Draft PSA Legislation
HMRC are updating the PAYE Settlement Agreement (PSA) process and make it easier and simpler to administer. Response by 21 February 2018.  The rules will apply from 6 April 2018.

Tax-free childcare now open to all
From 14 February 2018 tax-free childcare is open to all eligible families regardless of the age of the youngest child.

An Inspector Calls

Unexplained Wealth Orders (freeview)
From 31 January 2018, HMRC can require a person to explain the source of their wealth by applying to the High Court for an Unexplained Wealth Order. 

Discovery Assessments (subscriber content)
NEW: Following a spate of cases, this seems to be a topical area for HMRC. We have now written a detailed guide for subscribers. 

 Case Update (freeview)

HMRC discovery "seriously flawed"
In HMRC v Raymond Tooth [2018] UKUT 0038 (TCC), the UT upheld the decision of the FTT that the extended discovery time limit for deliberate error did not apply. It also overturned the FTT’s decision that there was a discovery.

Editor's Choice 

All about Appeals
NEW: our new section, how to appeal, grounds for appeal, when to request a review, conditions for making a late appeal.

R & D Zone
NEW: cut out the middleman and make your own R & D claim

UPDATE: take a tour through our content for start-ups and tax efficient funding

Tax Guides and Updates (subscribers) 

Termination, redundancy and leaving payments
UPDATE: HMRC have confirmed that the changes to the rules for Payments in lieu of notice (PILON) from 6 April 2018 will not apply to payments made in 2018/19 in respect of terminations in 2017/18.

General Data Protection Regulation (GDPR)
UPDATE: The European commission have released new guidance and an online tool in respect of GDPR ahead of the 25 May 2018 deadline for the introduction of these new rules in the UK. 

Wages: spouse or family
NEW: Subscriber guide to employing your spouse or family member, how to do it correctly and planning opportunities.

Non-domicile rebasing relief
NEW: Client briefing note for subscribers on rebasing relief under the new non-domicile rules.

Buy to let: SDLT on partnership incorporation
UPDATE: if new partners are admitted to a property investment partnership, an SDLT charge may arise due to the special rules for partnerships and SDLT.

 VAT (freeview)

£1,583 error leads to £297,485 surcharge
In Global Switch Limited v HMRC [2017] TC06252, the First-Tier Tribunal agreed with HMRC that a £297,845 surcharge, which was ultimately realised due to a £1,500 VAT error, was not inappropriate.

VAT (subscribers)

DIY Housebuilders scheme
NEW: it is possible to recover VAT on constructing a new residential dwelling, or dwellings, even where there is no planned sale of the property. This recovery can arise under the special refund scheme for DIY housebuilders.

Food: catering and takeaway
UPDATE: latest case law has found that bicarbonate of soda, where packaged for food, will be zero rated, despite having uses other than within baking.

CPD Webinars

New CPD click here

Missed last time's update?

Nichola's SME Tax w-update to 9 February 2018


  • Wages to son: not wholly and exclusively 
  • Data protection & HMRC
  • Employer's: What's on - Jan - March 2018
  • Transfer of assets abroad
  • Non domicile tax toolkit
  • Remittance basis
  • and much more..

Come and join our Cloud

Subscribe (and UNLOCK the whole site) A single user annual subscription is £365 (+ VAT). 

What do you get?

  • We keep YOU up to date in SME tax.
  • FULL access to www.rossmartin.co.uk: your firm's personal TAX INTRANET containing over 2,500 actively maintained tax guides, briefings, toolkits and checklists.
  • Want to know more? Commission your own articles and checklists.
  • Structured CPD: our detailed SME tax updates "for Advisers Only" provide topical summaries and planning notes & our NEW webcasts provide you with structured CPD at your desk.
  • Regular client tax briefings: these cover the latest business and employment tax issues and are designed to assist you plan meetings and improve your client services.