Employees

Dividend waivers in a holding company and subsidiary and tax liabilities

Issue 54 of HMRC’s Employer Bulletin is summarised below.

P45s

The Revenue’s understanding used to be that employers could not provide parts 1A, 2 and 3 of form P45 to a departing employee electronically.

The department has now received legal advice confirming that the relevant PAYE regulation governs the electronic transmission of information to and from HMRC, not between the employer and employee.

M Joyce (TC4453)

Barking Brickwork Contractors Ltd (TC4454)

AG Flutter (TC4443)

HMRC want volunteers to help them test the agent online self-serve (AOSS) now that it has successfully moved to a private beta phase.

The tax department is set to launch an expanded view of employer clients PAYE accounts, which will provide a monthly breakdown of employers’ PAYE liabilities and how payments received have been allocated to each period.

Agents wishing to take part in the latest stage of testing should complete the questionnaire on the taxman’s blog.

Tax experts applaud Revenue’s “pragmatic” PAYE approach

Implications of an inter-company loan being written off

Can capital allowances be claimed on a car purchased personally for company use?

Treatment of compensation arising from a racial discrimination claim

The annual end-of-year reconciliation for PAYE taxpayers has begun, to check that people have paid the right amount of tax in 2014/15. HMRC expect the process to be completed by October.

Tax calculations – P800s – will be issued, and people due a repayment will receive a cheque about two weeks after the calculation, according to the Revenue.

The Low Incomes Tax Reform Group (LITRG) has reissued its guidance on what taxpayers should do if they receive a P800. The information includes explanations on how a person may be able to reduce a tax bill or have it set aside.

Government plans to reduce administrative costs to business by £10bn will fail unless the complexity of the tax code is tackled, the Institute of Chartered Accountants in England and Wales (ICAEW) has warned.

Two of the UK’s three longest Finance Acts were enacted in the previous parliament, the ICAEW notes in a letter to the chancellor of the exchequer, George Osborne, while calling for a “one in, two out” principle to apply to tax laws.