Hello everyone, summer seems to have finally arrived and we have a new government settling in which brings the prospect of potential changes in the forthcoming October budget. This month we cover current HMRC campaigns and known and expected tax changes, tax return key dates and an update on the firm’s charity of the year.

Kind regards
Simon

Tax returns – A big thank you for all those who have sent in their accounts and tax return details it is much appreciated. Our prize draw for all those sending in their details by mid-July has been drawn and the prize is on its way to the lucky winner. We would ask that clients continue to send in their tax return and accounts details as soon as they are available and by no later than 30 September. We are aiming to complete all tax returns by 30 November 2024 this year so help us to achieve this target by sending in your papers once they are ready.

HMRC and government are keen to close the perceived “tax gap” being the amount they believe they should receive which is not collected. We are seeing an increase in compliance activity including the issue of “nudge” letters. “Nudge letters” are sent to taxpayers HMRC suspect may not have declared all their income. Recent campaigns include:

1. Crypto currency activity – many may not realise they are an issue as taxation of crypto assets is not well understood:
2. On-line sales – HMRC require online marketplaces to report people making regular sales so that they consider whether the activity amounts to trading.
3. Let Property and property sales – HMRC receive reports from letting agents of rents collected and review the Land Registry for unreported property sales.
4. Dividend income – HMRC have compared private company accounts with tax returns for discrepancies see our article for further details.

HMRC are making increased use of their computer systems to identify undeclared income. If you receive a “nudge” letter do not ignore it. We would ask clients to discuss any letters received from HMRC with us even if you do not think it is relevant to you so we can agree an appropriate response. See our article  for tips on how to prepare for an investigation.

October Budget – the government have already announced measures which are unpopular with those effected including VAT on school fees, restriction of winter fuel payments and reviewing the treatment of non-UK domiciled people. As increases in income tax, National insurance and VAT have been ruled out what does that leave? It has been suggested that capital gains tax, inheritance tax and the treatment of pensions could be targeted. Whilst we await the budget announcements on 30 October, individuals would do well to make use of existing reliefs and exemptions and to be prepared to have to adapt to potential changes.

Annual Cycle Ride for Building Better Futures International
BBFI works in Tamil Nadu, Southern India to help marginalised women living in rural villages by providing training and education to enable them to support themselves and their children. Training is provided for tailoring, hand loom weaving and animal husbandry as well as providing tuition centres for local children.

We are planning our annual cycle ride in September to raise money for maintaining the training programs. For more information on the work of this charity see Building Better Futures International.