Friday, 22 February 2013

Business Records Check

HMRC have relaunched their business records check programme. The purpose of this is for HMRC to check the adequacy of the business records being kept by small and medium sized enterprises (SMEs).

It is now HMRC’s intention to write to selected SME's to conduct an interview style call to assess whether they feel a face-to-face visit is required. The call will take approximately 10-15 minutes to enable the officer to assess the SMEs record keeping. If the officer making the call deems the records to be adequate, he will confirm his decision in writing and no further action will be taken.

If, however, he feels the records can be improved he will arrange for a colleague to call and make arrangements to visit the premises.

If on visiting the records do appear to fall short of what is required, recommendations will be given for improvements. If these recommendations are not adopted and have not improved at the time when a follow up visit is made, a first offence penalty of £500 will be considered (this will be reduced to £250 if it is in the first year of trading).

If on visiting the SME the officer finds the records to have been deliberately destroyed, a penalty of up to £3,000 may be charged.

It is important that you advise us immediately if any such telephone call is received. Please contact Ray Callingham for further advice on this matter.

Friday, 8 February 2013

Employer's National Insurance Holiday

New employers can still benefit from the Employer's National Insurance holiday introduced in 2010. This exemption applies to Employer's National Insurance chargeable for the first twelve months of the business or up to 5 September 2013, whichever comes first. At up to £5,000 National Insurance for the first ten employees, this relief is worth looking at closely for those who qualify. In order to qualify, there needs to be a new business starting and paying a wage before 5 September 2013. This does not have to be a new company or individual starting in business, it applies equally to an existing business provided that it is performing wholly or mainly new activities. The key point is whether these business activities were carried on in the proceeding six months.  HMRC give the example of a traditional being closed down by a new owner, refurbished and reopened as a gastro pub as one that would qualify. A business that has simply changed ownership may well not qualify, therefore the incorporation of a sole trader or partnership into a limited company will not receive the exemption unless the business activities wholly or mainly change.

The business must have its principal place of business in one of the following regions:-

·                    Northern Ireland
·                    Scotland
·                    Wales
·                    East Midlands
·                    North East
·                    North West
·                    South West
·                    West Midlands
·                    Yorkshire and Humber

Certain sectors such as road freight and agriculture have restrictions based on EU state aid rules. Managed service companies do not qualify.

If a business has paid National Insurance when it feels that it should have qualified for this relief, an application form can be submitted to claim a repayment. The business must have commenced after 22 June 2010 and contributions after 6 September 2019 may qualify.

G M Beeley