The government has published draft Finance Bill clauses


The Government has published draft clauses for the next Finance Bill, which broadly cover pre-announced policy changes.

The government is committed, where possible, to publishing most tax legislation in draft for technical consultation before the relevant Finance Bill is laid before Parliament.

The consultation will close on 14 September 2021.

Internet link: GOV.UK Draft Finance Bill 2021-22

Consultation launched on self-employed basis period reform


HMRC has recently launched a consultation on how basis periods can be reformed for income tax for the self-employed.

The consultation seeks to gather views on how best to implement a proposal to simplify the rules under which profits of an unincorporated trading business are allocated to tax years using basis periods. The consultation also includes suggestions regarding transitional rules for moving to the new system.

HMRC aims to simplify the system before Making Tax Digital (MTD) for income tax is implemented.

The proposals affect the self-employed and partnerships with trading income. It mainly affects unincorporated businesses that do not draw up annual accounts to 31 March or 5 April and those that are in the early years of trade.

HMRC stated that it would like to gather views on the matter from businesses, advisers, tax software providers and representative bodies.

Internet link: GOV.UK Basis period reform – consultation

800,000 claim tax relief for working from home


HMRC has confirmed that almost 800,000 employees who have been working from home during the pandemic have already claimed tax relief on household related costs.

The saving is worth up to £125 per year for each employee, and eligible workers can claim the full year’s entitlement if they have been told to work from home by their employer, even if it has been for just one day during the tax year.

Employees who have either returned to working in an office since early April or are preparing for their return can still claim the working from home tax relief and benefit from the full year’s relief for 2021/22.

Employees can apply directly themselves and receive the full tax relief that is due. Once their application has been approved, their tax code will be automatically adjusted for the 2021/22 tax year, and they will receive the tax relief directly through their salary.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘More people are getting back to office working now, but it’s not too late to apply for tax relief on household expenses if they’ve been working from home during the pandemic.’

Check eligibility and apply online at www.gov.uk/tax-relief-for-employees/working-at-home.

Internet link: GOV.UK news

440,000 tax credit claimants still to renew their claims


HMRC is reminding tax credit claimants that they have until 31 July 2021 to renew their claims.

According to HMRC, 440,000 claimants have yet to renew their claims. More than 2.5 million annual tax credits packs were posted to claimants between late April and early July 2021.

Claimants will have either received an ‘auto-renewal’ reminder or a ‘reply required’ notice. All ‘reply required’ claimants must renew their claims or contact HMRC to notify them of any change in circumstances ahead of the deadline to continue receiving tax credits payments.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

‘We know how important tax credits are to our customers, so we’ve made it quicker and easier to renew claims online. There’s no need to wait for the 31 July deadline – do it now by searching ‘tax credits’ on GOV.UK.’

To renew your tax credits claim visit www.gov.uk/renewing-your-tax-credits-claim.

Internet links: GOV.UK press release

Over 280,000 families now using Tax-Free Childcare


More than 282,000 working families used a Tax-Free Childcare (TFC) account during March 2021, according to figures from HMRC.

HMRC stated that it is the highest recorded number of families in any one month since the scheme was launched in April 2017. These families received a share of more than £33 million in government top-up payments for their childcare.

The TFC scheme can be used to help pay for accredited holiday clubs, childminders or sports activities – enabling parents and carers to save money on the costs of childcare.

The TFC initiative is available for children aged up to 11, or 17 if the child has a disability. For every £8 deposited into an account, families will receive an additional £2 in government top-up, capped at £500 every three months, or £1,000 if the child is disabled.

Myrtle Lloyd, Director General for Customer Services at HMRC, said:

‘We want to help kids stay active this summer, whether they are going to summer holiday clubs or a childminder. A childcare top-up will go a long way towards helping parents plan and pay for summer activities to keep their kids happy and healthy.’

More details and registration for TFC can be found at www.gov.uk/tax-free-childcare

Internet link: GOV.UK TFC statistics

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