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LITRG supports the recommendations of the Office of Tax Simplification (OTS) on tax penalties and their administration by HMRC, finding some particular potential pluses for the unrepresented. Introduction The OTS's November 2014 final report on tax penalties was only a short review of the tax penalty system. It focused on those penalties that have been ‘modernised’ since the formation of HM Revenue & Customs (HMRC) from the two former key tax authorities – the Inland ... Continue Reading

LITRG recognises the potential benefits of tax devolution to Scotland but cautions that setting rates and thresholds of a devolved income tax must include consideration of welfare benefits interactions. Introduction The Low Incomes Tax Reform Group (LITRG) has submitted comments to the Smith Commission, the body set up by the Government to consider devolution of further powers to the Scottish Parliament, and to the Scottish Parliament’s Finance Committee. The group’s main ... Continue Reading

We are pleased to publicise an event hosted by HMRC in Manchester, at: 16:30 - 18:30 on 2 December  With presentations on Enterprise Investment Scheme Behavioural Penalties       Intellectual Property Office Having seen the presentations by the IPO in previous events, I think that on its own makes the event worthwhile. Room GE12A Trinity Bridge House 2 Dearmans Place Salford  M3 5BS Please ... Continue Reading

There is a restriction on the size of garden or grounds attached to a main residence that can be granted PPR relief. The ‘permitted area’ must not exceed half a hectare (approximately 1.25 acres); this area is the total area, including the grounds on which the residence is built.    However, a larger area may be permitted should it prove to be needed for the ‘reasonable enjoyment’ of the house as a residence, commensurate with the size and character of the property.    Care ... Continue Reading

  TW Ed thinks HMRC's Digital Strategy should be renamed "Digital To A Fault"   A Good Morning to you all. TW Towers has been a hive of activity for some months now, reaching near-fever-pitch in the last few weeks. Something is afoot – and not just my size-9s. 200,000 Will Miss Out on New Government Childcare? There are a few stories that I should mention. There is a piece in the Independent of a “leaked” HMRC report ... Continue Reading

HMRC has updated its Tax Information and Impact Note on the new flexible arrangements for accessing funds from money purchase schemes from age 55. HMRC summarises the changes as follows, in that, starting from April 2015, it will allow all of the funds in a money purchase arrangement to be taken as an authorised taxed lump sum, removing the higher unauthorised payment tax charges increase the flexibility of the income drawdown rules by removing the maximum ‘cap’ on withdrawal ... Continue Reading

A new report by the LITRG will highlight the plight of temporary low-paid agency workers who turn to confusing and costly umbrella arrangements to claim tax relief on travel expenses. Background 'Pay Day by Pay Day’ (PDPD) schemes are a type of ‘umbrella’ arrangement. Under an umbrella arrangement, temporary workers who incur travel expenses receive ‘relief’ on those expenses because it converts a series of short-term agency posts into temporary workplaces ... Continue Reading

HMRC has announced that it will introduce further protection for taxpayers and safeguards for its new powers to take money directly from people's bank accounts. Plans to recover tax and tax credit debts directly from the bank accounts of people and businesses who refuse to pay what they owe will include strong safeguards to protect vulnerable taxpayers, the government announced today. Direct Recovery of Debts (DRD) will give HM Revenue and Customs (HMRC) the ability to recover ... Continue Reading

Media reports in October suggested that HMRC have issued a number of incorrect 2014/15 tax calculations to PAYE taxpayers. LITRG explains what to do to check yours. Introduction LITRG always advises people to check PAYE tax calculations (known as form ‘P800’) carefully. This is because an automated system draws together the information HMRC receives about your tax position – mostly from employers and pension providers – and uses it to produce the tax ... Continue Reading

Tax relief is available when an asset is lost, destroyed or becomes of negligible value – this is possible, for example, when a Buy To Let property is purchased ‘off plan’, the builder goes into liquidation, money is lost and the property is never built.   To claim the relief:   The investor must still own the property when it becomes of negligible value. The amount of relief is calculated as if the property had been sold and immediately reacquired. The ... Continue Reading