19 Dec 2013 03:32pm

Weekly tax update

Our look at the technical updates and notices in the tax world this week

Problems with the business tax dashboard

HMRC has issued a warning about an ongoing IT glitch that, in some cases, is preventing the Business Tax Dashboard from displaying up-to-date tax month five information for a small number of employers. As a result, the Employer Payment Summaries (EPS) data submitted for tax month 5 only (6 August 2013 to 5 September 2013) are not appearing on the dashboard.

Where this has happened, the dashboard is showing an incorrect position for month 5, but correct figures for months 6, 7 and 8, and “year to date”. HMRC's internal systems, though, are showing the correct position.

An investigation has concluded that the problem is only affecting employers who submitted EPS between 8 and 13 September 2013.

HMRC has apologised for the inconvenience and is asking employers not to contact the department if they submitted an EPS between 6 August 2013 and 5 September 2013 and think that the dashboard shows an incorrect PAYE position for month 5.

It knows which cases are involved and expects to have them all corrected by mid-January.


QROPS online service

HMRC has launched an online service aimed at providing a more secure facility for reporting information about qualifying recognised overseas pensions schemes (QROPS).

QROPS scheme managers and UK scheme administrators will be able choose whether or not to use the online service or to continue to meet their reporting requirements using the existing paper process.

However, the online facility offers a faster way to notify or re-notify HMRC that the scheme is a recognised overseas pension scheme, and to report change of details, status and notification of fund value, payments made out of funds received from a UK pension scheme, and any additional information required for schemes that were formerly QROPS.

It also offers and easy way to report multiple transfers/members in one go.

Managers and administrators who have already informed HMRC that a scheme is a recognised overseas pension scheme, will hear from HMRC by post sometime in January.

The letter will contain a scheme manager ID and activation token which will be need in order to enroll for the online service.

However, HMRC warns, the service should not be used before enrolment because it will not connect through to the relevant schemes.


Employer Bulletin scam alert

HMRC has issued a warning about a bogus email being circulated which informs employers that the latest version of the Employer Bulletin (issue 45) has just been published. The email has an attachment which should not be opened as it contains a virus.

The department’s security team has published the text of the rogue email:

Important Information for Employers - Employer Bulletin Issue 45

From: HMRC Employer Alerts & Registrations [] Sent: To: Subject: Important Information for Employers

Employer Bulletin Issue 45 out now The latest version of the Employer Bulletin issue 45 has just been published. This edition contains the latest information about filing your PAYE information in real time. To find out more open the attached document(s)

Your next employer email alert is scheduled for February 2014 *** Please do not respond to this email If you have any concerns regarding the validity of this or any emails received from HMRC go to our Online Security pages for more information by using the web address below.


Don’t send nudge letters to represented taxpayers

The ICAEW Tax Faculty has written to HMRC to express concern about the proposal to send “nudge” letters to taxpayers to ensure that they comply with the rules.

It says that sending them to taxpayers who are represented could adversely damage the agent/client relationship. The taxpayer may gain the mistaken impression that HMRC is sidestepping the agent because the agent has overlooked something that needs to be done.

This, it adds, would be an understandable reaction but giving rise to the perception that the agent has done something wrong.

“Given that this forms the bedrock of the tax system and the role that agents play in supporting compliance, this is wrong in principle,” it says. “HMRC should be looking to support agents in their work rather than apparently calling into question the agent’s professional ability in the eyes of the client.

“Given this concern, the approach increases burdens and costs as agents will seek to reassure clients that all is well and they have nothing to worry about.”

The faculty suggests that HMRC should send a copy of the nudge letter in advance to agents to give them a chance to pre-empt their clients’ concerns.

It points out that after HMRC sent out nudge letters last summer to non-dom taxpayers, one large firm had to launch a damage limitation exercise after the event, by writing to every non-dom client to reassure them that their tax affairs were in order. “A significant number of clients also had to be contacted by telephone to reassure them that their affairs were in order, and this involved considerable resources for no benefit to HMRC, the client or the tax agent.

The faculty adds that it does not have a problem with sending nudge letters to non-represented tax payers.


Offshore employment intermediaries

HMRC has published draft guidance as part its public consultation on proposals to strengthen legislation where there is an offshore employment intermediary.

However, it warns that the draft guidance requires Parliamentary approval for the legislation involved and so might well change before it comes into operation.


Resolving tax disputes with HMRC

HMRC has updated its code of governance for resolving tax disputes to include the remits of the line of business case boards and issues panels.

Each line of business – enforcement & compliance, business tax and specialist personal tax – has a governance board for reviewing large and sensitive cases within its area. HMRC explains that, when an issue has been identified as having a far-reaching impact across multiple taxpayers, it is referred to a contentious issues panel for a decision on departmental strategy for handling it. The anti-avoidance board provides oversight of how avoidance issues are worked across the department.


Scheme reconciliation service

In the run-up to the end of contracting-out in April 2016, HMRC is to offer a scheme reconciliation service (from April next year) to allow pension scheme administrators and trustees to reconcile the membership and Guaranteed Minimum Pension (GMP) data held on scheme records against HMRC’s records.

From next month, it will also publish the first in a series of bulletins about activities linked to the ending of contracting-out.


Replacement registration guides

The following registration guides have been revised.

MLR9a, Registration Guide for Money Service Businesses

MLR9b, Money Laundering Regulations Registration Guide for High Value Dealers

MLR9c, Registration Guide for Trust or Company Service Providers 

MLRd, Registration Guide for Accountancy Service Providers

Other headlines

Record £20bn tax yield for HMRC

Draft Finance Bill outlines tax proposals 

HMRC extends RTI for micro employers 

Tax squeeze on wealthy expats 

HMRC denies fraud fuelling VAT 


Julia Irvine