All change at HMRC

HMRC has announced a number of major changes, including the closure of 137 offices and a switch to largely digital communication with taxpayers. At the same time, HMRC will focus all its efforts on 10 regional centres in Manchester/Liverpool, Leeds, Nottingham, Birmingham, Cardiff, Belfast, Glasgow, Bristol, Croydon and Stratford with a few specialist offices at Telford, Dover, Worthing and Gartcosh. Meanwhile, HMRC’s Affluent Unit has increased its headcount by just over 50%, from 213 in 2012/13 to 327 in 2014/15. The salary bill for Affluent Unit inspectors rose 68% over the same period, from £7.8m to £13.1m. The unit investigates taxpayers on incomes of over £150,000 per year and collected £137.2m in extra tax from its probes in 2013/14, up from £85.7m the previous year.

Britain’s Black Economy

The BBC is currently filming Britain’s Black Economy, which will be broadcast in 2016. One of the programmes, entitled The Town That Went Offshore, is all about how a range of small businesses in Crickhowell, Wales have all moved offshore in order to exploit loopholes in the tax code. The businesses were advised by tax professionals and followed by a BBC crew as they copied the offshore arrangements used by global brands including Google, Amazon and Starbucks, which pay little or no corporation tax.

Scottish income tax update

The impending Scottish rate of income tax will apply from 6th April 2016 and anyone with Scottish employees would be well advised to start planning for its introduction. HMRC will advise you who the Scottish taxpayers will be – and an ‘S’ will be added to the start of their tax code.

The right to appeal

The Court of Appeal has agreed that investors in Ingenious Media film partnership schemes can appeal a High Court decision dismissing their judicial review challenge against HMRC. The challenge relates to partner payment notices and accelerated payments notices.

Cameron cracks down on overseas territories

David Cameron has announced a further crackdown on tax evasion, corruption and money laundering after a meeting this week with leaders of Britain’s overseas territories such as the British Virgin Islands and Cayman Islands. The prime minister has pushed hard for the introduction of central public registers of company ownership in overseas territories in order to allow law enforcement agencies to trace currently anonymous criminals behind businesses.

New levy will hit small businesses

The new apprenticeship levy will add to the tax burden suffered by small to medium-sized businesses, according to Carolyn Fairbairn, director-general of the Confederation of British Industry: “The apprenticeship levy, set at 0.5%, is a significant extra payroll tax on business and by widening the net it will now catch more smaller firms.”

UK CGT bill up 43%

HMRC raised an additional 43% (some £5.5bn) in capital gains tax last year.