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NI Bill
The National Insurance Contributions Bill was published on 11 October 2005. The Bill's overall aim is to stop the avoidance of National Insurance on rewards of employment by introducing powers to enable the making of National Insurance regulations that can take effect from an earlier date, if necessary going back to 2 December 2004. The powers will enable HMRC to deter and tackle tax and National Insurance avoidance more effectively by ensuring that payments of employment reward will be charged to tax and National Insurance from the same date.
The first use of this power will be to introduce regulations to apply National Insurance liability to employment related securities charged to income tax by Schedule 2 of Finance (No 2) Act 2005 effective from 2 December 2004. Other changes to the National Insurance regulations will provide for the payment and collection of the National Insurance liability on past payments and consequential effect on statutory payments and contributory benefits.
The Disclosure Rules in FA 2004, which required promoters to report tax avoidance schemes, did not cover schemes or arrangements that avoided National Insurance only. This Bill contains a power to make regulations that will ensure that any such avoidance scheme or arrangement is disclosed.
The Bill will prevent the potential transfer of employers' secondary National Insurance liability in respect of past earnings that are caught by the regulations made under the provisions in this Bill, by way of agreements or joint elections, due on earnings from certain types of share and securities to the employee.
HMRC news release dated 11 October 2005
Gift aid change
Following consultation with charities, charities will no longer have to write to each individual donor to confirm that gift aid can be claimed following a telephone donation. This should allow charities to spend less time on paperwork and administration, and more time on fundraising and charitable activities.
The new regulations, which come into force on 1 November 2005, will remove the requirement to write to the donor, where the charity has maintained satisfactory records linking the donor to the making of a declaration.
HM Treasury press release 7 October 2005
