Worldwide Disclosure – Time running out

Cessation of Worldwide Disclosure Facility
Tax payers have a few weeks left to take advantage of The Worldwide Disclosure facility. The Worldwide Disclosure, which opened in September 2016 is closing from 30 September 2018. The disclosure dealt with income and gains which have an offshore element in them.

From 30 September 2018, there will be new legislation to replace the Worldwide Disclosure, called “Requirement to Correct”.  Individuals disclosing undeclared income and gains will subject to harsher penalties under this regime.

The Financial Secretary to the Treasury, Mel Stride MP, said:

Since 2010 we have secured over £2.8bn for our vital public services by tackling offshore tax evaders, and we will continue to relentlessly crack down on those not playing by the rules.This new measure will place higher penalties on those who do not contact HMRC and ensure their offshore tax liabilities are correct. I urge anyone affected to get in touch with HMRC now.

HMRC have stated:

“From 1 October more than 100 countries, including the UK, will be able to exchange data on financial accounts under the Common Reporting Standard (CRS). CRS data will significantly enhance HMRC’s ability to detect offshore non-compliance and it is in taxpayers’ interests to correct any non-compliance before that data is received.”

Worldwide Disclosure Facility is used mostly for foreign income and property. HMRC have stated that “over 17,000 people have already contacted HMRC to notify the department about tax due from sources of foreign income, such as their holiday homes and overseas properties.”

HMRC have provided examples of what could be construed as offshore assets : art and antiques; bank and other savings accounts; boats; cash; debts owed to you; gold and silver articles; government securities; jewellery; land and buildings, including holiday timeshare; life assurance policies […]

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National Insurance Contributions In The UK

What are National Insurance contributions in the United Kingdom and who has to pay them? How do taxpayers pay it? How much do they have to pay?

1. What Are They- National Insurance contributions are paid by people. They pay them in order to qualify for various benefits, such as State Pension. Some other benefits include a state pension, maternity allowance and bereavement benefits.

2. Who Makes The Contributions – National Insurance are payable by employees, employers and the self employed. For example, if you are an employee who earns more £155 per week,  you may be liable. If you are self employed and your net profits were £5,965 or more in a tax year, you may have to pay them. UK citizens and residents need to have a National Insurance number before they can make contributions.

3. How Much Do You Pay- There are various factors that play a role in how much is payable towards National Insurance. Generally, the amount payable will depend on your profits if you are self employed. For the employed, the national insurance contributions depends on the pay . Rates may change when the tax year changes.

People who tend to pay less include those who are a widow or a married woman with a certificate of election. Having a valid a valid small earnings exemption may result in less national insurance.  People also pay less if they have more than one job.

Aside from the above, there are  a number of National Insurance rules. These include directors of a company, as well as landlords who run a property business. If you fall into either of these categories then you may want to consult a small business accountant who has specialised knowledge in these […]

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Self Assessment & PAYE tax gap narrows

Self assessment & PAYE tax gap narrows
The UK’s tax gap, which is the difference between tax collected by HMRC through self assessment, disclosure schemes and tax investigations and the amount of tax owed has narrowed to 6.4%. This is welcoming news for both the Treasury and the economy as a whole. Much of the gap will relate to avoidance and evasion.

Despite this fall, from 6.6% in 2012/2013, there is still a staggering £34bn to be collected, showing there is still much to be done, says ACCA (the Association of Chartered Certified Accountants).

Chas Roy-Chowdhury, ACCA head of taxation, stated:

“It is a huge credit to the staff at HMRC that they have managed to lower the tax gap despite constant cuts to their budget. However with £34bn still uncollected, and the government struggling to meet its borrowing target the Chancellor should reconsider his decision to cut HMRC’s resources.

Corporate tax avoidance may be falling but there is still a sizeable amount lost due to innocent mistakes and evasion. It is in these areas where more resources for HMRC could be best deployed. In helping guide those who want to pay the right amount of tax and in investigating those who are determined not to pay tax.

We should also remember that these figures include £1bn collected from accelerated payment notices. Those are a one off catch-up from historic schemes that won’t be repeated – and there is always the risk that even some of those amounts will have to be returned, as taxpayers are challenging HMRC’s approach in this area.”

Tax Summaries

HMRC is now sending out tax summaries to tax payers, setting out how much tax and National Insurance the particular taxpayer has paid and how it has been utilised on public expenditure.

Taxpayers can view their summaries online by logging into HMRC online Services.

Financial Secretary to the Treasury, David Gauke, said:

Taxpayers have a right to know how the government is spending their tax and National Insurance contributions. The Government promised to provide transparent information about its expenditure and these summaries deliver on that promise.

Any taxpayer who does not receive a tax summary can use HMRC’s tax calculator to estimate their tax bill and see how it contributes to public spending.

HMRC has also launched an app, The ‘HMRC App’ which contains the calculator and can be downloaded free of charge.

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