ATT warns of tax changes for non-residential UK property owners

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The Association of Taxation Technicians (ATT) has warned non-resident UK property owners that changes set to take effect from April will require them to pay tax on all UK land disposals, no matter whether residential or commercial.

Since 6 April 2015, non-UK residents selling a residential property have been required to file a tax return and pay any tax due within 30 days of the sale.

From 6 April 2019, these rules will be extended to cover sales of all UK land and property, both residential and commercial, as well as ‘indirect disposals’, where an individual disposes of ‘substantial interests in companies which are UK property-rich’.

Commenting on the changes, Jon Stride, Co-Chair of the ATT’s Technical Steering Group, said: ‘Any non-UK resident who owns an interest in UK land or property needs to be aware of these significant changes.

‘In particular, those looking to sell need to be aware that they will have to file a non-resident capital gains tax (CGT) return with HMRC and pay any tax due in a very short time frame.

‘Non-residents who hold UK commercial land or property should consider getting their property valued as at 6 April 2019, whether or not they anticipate a future sale. In the event of such a sale, the value at that date would be used to calculate the taxable gain.’

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Government delays probate fees rise

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The government has delayed its planned increase in probate fees.

The delay has been attributed to ‘pressure on Parliamentary time’ caused by Brexit debates and votes.

The increase in fees had been set to take effect from 1 April 2019, but HMRC recently made the decision to postpone the rise. Under government plans, estates which are valued between £50,000 and £300,000 will be subject to a probate fee of £250. Fees rise thereafter to reach £6,000 for estates with a value above £2 million.

While the changes are pending, a temporary process is in place for applying for probate, and estates will not incur the higher fees if applications are made before the fee changes take effect.

Commenting on the matter, a spokesperson for HMRC said: ‘Probate registries will accept applications before processing by us as long as they are assured the inheritance tax (IHT) forms from us will be coming shortly.

‘Our processes aren’t changing, it’s just that probate registries will be willing to accept applications before our processing is done, when normally it would need to be after.’

ONS warns automation could ‘replace 1.5 million jobs’

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The Office for National Statistics (ONS) has warned that automation could replace up to 1.5 million jobs in the UK, leaving workers unemployed.

In a new report, the ONS found that 70% of the jobs at risk of becoming automated are carried out by women.

It also revealed that the jobs ‘most at risk’ of automation are those considered to be ‘routine or low-skilled’. Jobs at the lowest risk of becoming automated are medical practitioners, teaching professionals and senior professionals within education.

The ONS warned that the automation of jobs could impact the UK’s labour market, economy and society.

In its report, the ONS stated: ‘It is not so much that robots are taking over, but that routine and repetitive tasks can be carried out more quickly and efficiently by an algorithm written by a human, or a machine designed for one specific function.’

HMRC urges firms to sign up for MTD for VAT

 

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With less than a week to go, HMRC is urging those firms which haven’t signed up for the Making Tax Digital for VAT (MTD for VAT) scheme to do so ‘as soon as possible’.

It is also advising businesses which have yet to prepare to ‘get ready now’ for MTD for VAT.

MTD for VAT will come into effect from 1 April 2019 for businesses which have a taxable turnover above the VAT registration threshold (currently £85,000). As part of the initiative, firms must keep some records digitally, using ‘functional compatible software’. This means a ‘software program or set of compatible software programs which can connect to HMRC systems via an Application Programming Interface (API)’.

Figures published by HMRC show that almost 1.2 million businesses will be affected by MTD for VAT. Additionally, each day more than 3,000 businesses are signing up to the scheme, according to the Revenue.

Commenting on the initiative, Mel Stride, Financial Secretary to the Treasury, said: ‘In a world where businesses are already banking, paying bills and shopping online, it is important that the tax system moves into the 21st century.’

Meanwhile, Theresa Middleton, Director of the Making Tax Digital for Business programme, said: ‘There are over 220 software products for businesses to choose from at a range of prices, including free ones, offering different levels of functionality.

‘I’d urge any business affected by MTD to start preparing now, and to join the thousands of others who are already experiencing the benefits MTD has to offer.’

Data reveals significant rise in number of contactless payments

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Data published by UK Finance has revealed that two in five card payments are made using contactless technology.

When compared to 2017, the number of contactless transactions carried out rose by 31% in 2018. 7.4 billion contactless debit and credit card transactions were made in 2018, the data showed – a significant increase when compared to 2017’s figure of 5.6 billion.

According to UK Finance, in 2018, contactless spending totalled £69 billion – a rise of nearly a third when compared to the previous year. The trade association also found that eight out of ten debit cards and six out of ten credit cards are contactless.

Commenting on the data, Eric Leenders, Managing Director of Personal Finance at UK Finance, said: ‘Many of us are now reaching for our cards or mobiles rather than cash to make low-value purchases, as customers opt for the convenience and security of paying with contactless.

‘There has also been an increase in credit card use, although growth in outstanding balances has slowed, suggesting many consumers are using their cards for day-to-day spending rather than as a means of borrowing.’

Data reveals 84,000 people fell victim to bank payment scams in 2018

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Trade association UK Finance has revealed that more than 84,000 bank customers fell victim to so-called bank payment scams in 2018.

According to data published by UK Finance, in the first half of 2018, £93 million was transferred out of personal accounts to fraudsters, with the customer’s permission. In the second half of 2018, £135 million was transferred from bank accounts to criminals.

The data also revealed that criminals are shifting their attention from trying to penetrate the banking system to defrauding members of the public directly.

According to UK Finance, criminals are carrying out a range of fraudulent activities. Some fraudsters sell counterfeit or non-existent goods online, whilst others execute sophisticated scams in which they pretend to be a trader known to the customer, and demand payments.

Katy Worobec, Managing Director of Economic Crime at UK Finance, said: ‘We are seeing a shift away from some of the methods that fraudsters are using to try and attack banks’ security systems to focusing on the person and duping them into making the payment themselves.’

In 2018, banks reimbursed £83 million of the losses suffered by bank customers. However, the final bill for businesses and individuals totalled £354 million. Banks have agreed to follow a new voluntary code from May 2019, which will facilitate reimbursement if a victim has met ‘expected standards of behaviour’.

HMRC warns businesses MTD registration ‘takes seven days’

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With Making Tax Digital for VAT (MTD for VAT) set to take effect from 1 April, HMRC has warned UK businesses that the registration procedure will take up to seven days to complete.

MTD for VAT will apply for businesses which have a taxable turnover above the VAT registration threshold (currently £85,000). As part of the initiative, businesses must keep some records digitally, using ‘functional compatible software’. This means a ‘software program or set of compatible software programs which can connect to HMRC systems via an Application Programming Interface (API)’.

In recently published guidance, HMRC stated that businesses that pay VAT by Direct Debit cannot sign up to the MTD for VAT scheme in the seven working days leading up to, or the five working days after, sending a VAT return.

In order to sign up to MTD for VAT, businesses will require their Government Gateway user ID and password, alongside their VAT number.

Once firms have registered, HMRC will send a confirmation email within 72 hours. Businesses are urged not to submit their VAT return until they receive the confirmation email.

The government has provided guidance on the matter – this can be found here.