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Peter Arrowsmith FCA highlights a selection of NIC matters, and offers some tips on NIC repayments, deferment and claims for the Winter Fuel Allowance.

Hope for Construction Companies

In Castle Construction (Chesterfield) Ltd v HMRC Commissioners (SpC 723), the Special Commissioner held that over 300 workers had been correctly treated as self-employed rather than employees as HMRC contented. The HMRC challenge was despite a number of clear badges of self-employment not least of which was the requirement to correct faulty work in the workers' own time and at their own expense and also despite HMRC having accepted the position a few years earlier. One driver and two slinger signalmen were, however, recategorised as employees.

I can't begin to imagine what came over HMRC to take this case in the first place and hope they will have the good grace not to further appeal. Either way, it does go to show that HMRC is not always right and that where you feel you have a good case it is well worth while fighting your corner.

New Appeals Tribunal

The General Commissioners will cease to exist with effect from 1 April 2009 - Tribunals, Courts and Enforcement Act 2007, Schedule 23, Part 1; Tribunals, Courts and Enforcement Act 2007 (Commencement No. 6 and Transitional Provisions) Order 2008 (SI 2696/2008).

The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (SI 2009/56) makes further provision with effect from 1 April 2009.
 
It abolishes the various existing tax appeal bodies and provides that, save for the General Commissioners, members of these bodies will transfer to the new tribunals.

Time limits which have already started will continue to run and all appeals made on and after 1 April 2009 will be to the new tribunals.

Cases remitted by a court on or after 1 April 2009 will also be remitted to the new tribunals.

The Order also provides for a voluntary review of appealable decisions across the range of HMRC duties including National Insurance Contributions and statutory payments. Various HMRC administrative changes are expected to come into effect at the same time.

Modified NIC Procedures

The revised modified PAYE procedures that came into effect on 6 April 2006 as regards workers seconded into or out of the UK have been slightly changed to take account of the new tax rules for non-residents from April 2008 and also the new P45(Expat) that is being introduced on 6 April coming.

At the same time, there are some minor changes made to the NIC procedures - mainly to paras 11 and 25 of the EPApp7 procedure. Full details can be found at www.hmrc.gov.uk/manuals/epmanual/epapp7a.htm

Tip of the Month - February 2009 

With all those tax returns now submitted for another year, you will hopefully have some time to review your clients' tax and general financial position in a more calm and relaxed manner before another new tax year starts.

Don't forget to include National Insurance matters in any reviews you undertake. Are there any repayments to claim because you did not apply for deferment for 2008/09? - be prepared so that you can claim repayment promptly soon after 6 April. More importantly, can you claim deferment for the forthcoming year if circumstances are expected to follow the same pattern? Deferment application forms will soon be available for 2009/10 at www.hmrc.gov.uk/individuals/fgcat-deferment.shtml

Also remember that it is not just people of state pension age that get the Winter Fuel Allowance. Men aged 60-65 on 21 September 2008 are entitled too, but this group will in most cases not be paid it automatically. The amount this year is £250 per household so if there is a wife over 60 who is due a payment (or has - more likely - already had it) no extra amount overall will be due - but at least either way it's tax-free. Where relevant, a claim will need to be made by 30 (not 31) March 2009 so it will be necessary to obtain a claim form well in advance of this date by calling the Winter Fuel Payment Helpline on 08459 151515, Monday-Friday, 8.30-4.30.

The above is taken from 'NIC Newsletter' (February 2009), and is reproduced with the kind permission of Peter Arrowsmith FCA, who retains the copyright.