The Office for National Statistics (ONS) has released figures showing that UK employment rates were up between February and April compared to the three months to January 2015.  As detailed in the press release the figures show:

• ‘There were 31.05 million people in work, 114,000 more than for the 3 months to January 2015 and 424,000 more than for a year earlier.
• There were 22.74 million people working full-time, 362,000 more than for a year earlier. There were 8.31 million people working part-time, 63,000 more than for a year earlier.
• The proportion of people aged from 16 to 64 in work (the employment rate) was 73.4%, up slightly from the 3 months to January 2015 (73.3%) and higher than for a year earlier (72.7%).
• There were 1.81 million unemployed people. This was 43,000 fewer than for the 3 months to January 2015 and 349,000 fewer than for a year earlier.
• Comparing February to April 2015 with a year earlier, pay for employees in Great Britain increased by 2.7% both including and excluding bonuses.’

Employment Minister Priti Patel said: ‘Today’s figures confirm that our long-term economic plan is already starting to deliver a better, more prosperous future for the whole of the country, with wages rising, more people finding jobs and more women in work than ever before’.

Neil Carberry, CBI Director for Employment and Skills, said:

‘These figures provide more evidence that the wage squeeze has eased, with private sector pay increasing almost as fast as it was before the crisis. At the same time, firms are creating more jobs.’

‘If we are to deliver sustainable higher wage growth, we need to see a rise in productivity. That means businesses investing in skills, and the Government helping firms innovate by supporting investment in next month’s Budget.’

‘These figures are testament to the strength of our flexible labour market, which has helped British firms create a strong number of permanent full-time jobs.’

Internet links: ONS bulletin Press release

HMRC have issued a list of makes and models of car derived vans and combi vans which VAT registered businesses can use to determine if the VAT paid on the purchase can be reclaimed as input tax.

The issue is that VAT will normally be claimable in full on the purchase of a commercial vehicle. However if the vehicle purchased is a passenger car VAT is not recoverable unless it is used ‘exclusively for the purposes of a business’. Generally cars are therefore VAT ‘blocked’ and no input VAT is recoverable.

The VAT guidance states:

‘Motor car means any motor vehicle of a kind normally used on public roads which has three or more wheels and either:

a) is constructed or adapted solely or mainly for the carriage of passengers; or

b) has to the rear of the driver’s seat roofed accommodation which is fitted with side windows or which is constructed or adapted for the fitting of side windows’

Whether or not a vehicle is commercial is not specifically defined but instead the definition of a car excludes:

• vehicles capable of accommodating only one person or suitable for carrying twelve or more people including the driver
• vehicles of more than three tonnes unladen weight
• caravans, ambulances and prison vans
• special purpose vehicles such as ice cream vans, mobile shops, hearses, bullion vans and breakdown and recovery vehicles
• vehicles constructed to carry a payload of one tonne or more.

Many car derived vans are not cars for VAT purposes as they have no rear seats, have metal side panels to the rear of the front seats and a load area which is highly unsuitable for carrying passengers etc.

HMRC have issued the clarification due to developments in the car derived van market, as some vehicles with a payload of less than one tonne have ‘blurred’ the distinction between cars and vans.

If you would like help with this or any other VAT issue please contact us.

Internet link: GOV.uk-car-derived-vans-and-combi-vans

HM Treasury has announced that the National Savings and Investments 65+ Guaranteed Growth Bonds have been bought by more than a million older savers, who made total investments of over £13 billion. These investment figures make the product the best-selling retail financial product in Britain’s modern history.

The ’65+ Guaranteed Growth Bonds’ from National Savings and Investments went on sale in January 2015 and offered savers aged 65 and over an opportunity to boost the return on their savings by investing up to £10,000 per bond at fixed annual interest rates of 2.8% for one year bonds and 4% for three year bonds.

The Bonds are no longer available to purchase with the investment window closing on 15 May 2015.

Internet link: GOV.UK news

HMRC have issued guidance on VAT reclaims by ‘qualifying charities’ under recent changes to the rules. ‘Qualifying charities’ for this purpose are those concerned with palliative care, air ambulance, search and rescue and medical courier charities.

The guidance details which charities are eligible to use the refund scheme to claim a refund of VAT incurred on goods and services used for their non-business activities.  It also covers issues such as what to do when circumstances change, what falls within the scope of the refund scheme and how charities can make a claim.

If you would like any guidance on this or any other VAT or charity issue please do get in touch.

Internet link: https://www.gov.uk/government/publications/vat-notice-1001-vat-refund-scheme-for-certain-charities

The Driving and Vehicle Licensing Agency has announced that with effect from 8 June 2015 the paper counterpart to the photocard driving licence will not be valid and will no longer be issued. The paper counterpart was introduced to display driving licence details that could not be included on the photocard. These additional details include whether the licence holder is entitled to drive some additional vehicle categories and any endorsement/penalty points. The DVLA is advising that the paper counterpart should be destroyed after 8 June 2015. Licence holders still need to keep their current photocard driving licence.

Those with a paper driving licence (issued before the photocard was introduced in 1998) need to be aware that these licences will remain valid and should not be destroyed. However where a licence holder needs to update their licence photocard licences will be issued.

From 8 June 2015 new endorsements will be recorded electronically, and will not be printed or written on either photocard licences or paper driving licences.

This means that from 8 June 2015 neither the photocard driving licence nor the paper licence will provide an accurate account of any driving endorsements a licence holder may have. This information will instead be held on DVLA’s driver record, and can be checked online, by phone or post.

This change does not affect photocard licences issued by DVA in Northern Ireland.

Internet link: GOV.UK news