HMRC has warned taxpayers completing their 2020/21 tax returns to ‘be on their guard’ and stay vigilant in regard to tax-related scams.

Nearly 800,000 tax scams were reported in the last year, HMRC revealed. It said that fraudsters use self assessment to attempt to steal money or personal information from taxpayers.

In the last year, HMRC received almost 360,000 bogus tax rebate referrals. HMRC will send more than four million emails and SMS messages this week to self assessment taxpayers, prompting them to think about how they intend to pay their tax bill.

It is warning taxpayers ‘not to be taken in’ by malicious emails, phone calls or texts, and to not mistake them for genuine HMRC communications.

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

‘Scams come in many forms. Some threaten immediate arrest for tax evasion, others offer a tax rebate. Contacts like these should set alarm bells ringing, so if you are in any doubt whether the email, phone call or text is genuine, you can check the ‘HMRC scams’ advice on GOV.UK and find out how to report them to us.’

The self assessment deadline is 31 January 2022.

Internet link: HMRC press release

A single person will need post-tax annual income of £10,900 for a minimum standard of living in retirement, according to the Pensions and Lifetime Savings Association (PLSA).

The minimum retirement living standard is based on the Joseph Rowntree Foundation’s Minimum Income Standard and covers a typical retiree’s basic needs plus enough for some social activities, such as a week of holiday in the UK, eating out once a month, but not including running a car.

That spending budget increases to £16,700 for a couple and also includes subscriptions and services such as getting a haircut.

The moderate retirement living standard includes a two-week holiday in Europe and more frequent eating out. This was assessed to require a budget of £20,800 for a single person, £600 higher than two years ago, and £30,600 for a couple, up £1,500.

The annual budget needed for a comfortable retirement living standard has increased since 2019 by £600 to £33,600 for one person and £2,200 to £49,700 for a couple.

This covered items such as regular beauty treatments, theatre trips and annual maintenance and servicing of a burglar alarm.

Nigel Peaple, Director of Policy and Advocacy at the PLSA, said:

‘The pandemic has emphasised the importance of economic security as well as social and cultural participation in retirement.

‘We hope the updated standards will encourage people to think about whether they are saving enough for the retirement lifestyle they want and, in particular, whether they are making the most of the employer contributions on offer in their workplace pension.’

Internet links: PLSA website

Homeowners in England and Wales will be offered subsidies of £5,000 from next April to help them to replace old gas boilers with low carbon heat pumps.

The grants are part of the government’s £3.9 billion plan to reduce carbon emissions caused by heating homes and other buildings.

It is hoped no new gas boilers will be sold after 2035. The funding also aims to make social housing and public buildings more energy efficient.

However, experts have stated that the budget is too low and the strategy not ambitious enough. Ministers say the subsidies will make heat pumps a comparable price to a new gas boiler, but the £450 million being allocated for the subsidies over three years will cover a maximum of just 90,000 pumps.

Matthew Fell, Chief Policy Director at the Confederation of British Industry (CBI), said:

‘£5,000 heat pump grants will help get the ball rolling when it comes to decarbonising homes across the UK. The government’s Heat and Buildings Strategy provides a golden opportunity for both the public and private sector to pick up the pace of progress to net zero.

‘There’s no doubt that the scale of the challenge is considerable. These welcome measures – including the 2035 phase out of new gas boilers – will help consumers and business better prepare to change the way they heat their homes and buildings.’

Internet links: GOV.UK CBI website

Businesses that are planning to operate in the UK’s new freeports can now apply to HMRC.

The tax authority has published the application forms to operate special customs procedures within the sites, along with further guidance on procedures for declaring goods moving into and out of sites.

Freeports are areas that benefit from a range of tax and other incentives, including a suspension from customs duties for imported goods and less burdensome customs procedures.

HMRC is now accepting applications to use freeport customs special procedures. The application form, which can be downloaded fromgov.uk, must be emailed or posted to HMRC once completed.

An application can be made by businesses that have a provisional agreement in place with a freeport customs site operator to store or process goods at a freeport customs site. An application may not be necessary if the business uses existing customs special procedures.

To complete the form, businesses will need, among other things, their Economic Operator Registration and Identification (EORI) number, company registration number (if a company), tax reference numbers and contact details.

Internet link: GOV.UK

The Institute for Fiscal Studies (IFS) has predicted that millions of people will be worse off in 2022 as a result of spiralling costs and tax rises.

Responding to the Autumn Budget, the IFS predicted that low-income families will be squeezed by a rise in the cost of living. The Office for Budget Responsibility (OBR) recently warned that the cost of living is set to rise at its fastest rate in 30 years.

The IFS stated changes to income tax and National Insurance, alongside rising household bills, will mean slow growth in living standards.
Paul Johnson, Director of the IFS, said:

‘With, in the words of the OBR, inflation quite possibly hitting its ‘highest rate in the UK for three decades’, millions will be worse off in the short term. Next April benefits will rise by just over 3%, but inflation could easily be at 5%. That will be a real, if temporary, hit of hundreds of pounds a year for many benefit recipients.

‘We are not at 1970s levels of inflation, but we are now experiencing enough inflation that real pain will be felt as low income households – most of whom have next to nothing in the way of financial assets – wait more than a year for their incomes to catch up. For some in work that may never happen.’

Internet link: IFS website