VAT Claimable for Entertaining Overseas Customers

In the light of recent ECJ judgments HMRC has concluded that the UK’s block on the recovery of input tax on the business entertainment of overseas clients is inconsistent with EU law. The Government intends to amend UK law shortly. In the meantime HMRC will consider claims for previously restricted VAT in respect of the entertainment of overseas customers, as a direct effect of EU law.

If you have entertained overseas customers in the last four years and want further information if you have a potential claim, please contact us.

Hollinwood Sportmans – Lee Sharpe

Hardy & Co attended the annual sportmans dinner in support of Hollinwood Football Club with Lee Sharpe and Sid Dennis making the line up.

Les Sharpe grabs a photo opportunity of a lifetime with Paul and Peter

The Ex Manchester United player Lee Sharpe couldn’t resist having his photo taken with Hardy and Co after Paul reminds him of the day he watched Paul play football in the local park!!!

HMRC PAYE CD-ROM

With the new tax year approaching clients that are used to finding necessary PAYE information on the Employer CD-ROM should be aware that this will not be issued this year.  HMRC are replacing the CD-ROM with a set of tools which can be downloaded from HMRC’s website.

HMRC are advising those wishing to use the tools that they need to download the updates to the CD-ROM first. These are available on the HMRC website.

Stamp Duty – Linked Transactions

Previously purchases of more than one property from the same entity/ person could be deemed a Linked Transaction for Stamp Duty (SDLT) purposes. Therefore in calculating the SDLT rate you would combine the values of the properties e.g. if you purchased 2 properties for £200,000 from the same individual you would pay 3% on the whole rather than 2 amounts of 1%.

Following the 2011 budget, plans are in place so the applicable rate will be calculated by using an average of the properties purchased with a minimun rate of 1%.

The saving made, based on the example above, would be £8,000.

Flat Rate VAT Scheme

The Flat Rate Scheme is designed to ease the administration burden of VAT accounting for small businesses, allowing them to charge VAT at the standard rate (20%), but pay a lower rate to HMRC, depending on the type of business.

The scheme can be used for businesses with turnover less than £150,000.

A simply example would be an I.T. Consultant with Income of £100,000. They would benefit from using the scheme by making a saving of approximately £2,600 per year.  

The scheme is aimed at easing the admin burden but as you can see above it can also benefit you financially.

It is not necessarily always beneficial to use the Flat Rate Scheme but like most things it is always good to continuously review the situation.

If you would like us to do a quick calculation, please email to info@hardyandco.co.uk

Tax Arrears/ Payments plans

A lot has been said recently about agreeing time to pay arrangements with HMRC. Some commentators have provided examples of between 3 months and 24 months.

We have found that there has been no hard and fast rules and that you need to look at it on a job by job basis. HMRC have reiterated the basic principles underlying the circumstances in which support will be given. The key is that in their opinion they must be satisfied that the business remains viable and must be in genuine difficulty. This can also be said for personal tax arrears.

We have recently agreed a 5 year payment plan in relation to personal tax arrears. There are extenuating circumstances in this case and by no means should this been seen as the norm.

Typically, we see case where HMRC will take payment over an 12 month period. However, the key to agreeing these types of deals is ensuring that you are timely in your negotiations and don’t wait for the last minute. We have found that by speaking with HMRC prior to the tax being due gives you the most opportune time to agree a plan.