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• HC Monthly News Bulletin: April 2022 | HaesCooper – Chartered Accountants & Chartered Tax Advisers

HC Monthly News Bulletin: April 2022 | HaesCooper – Chartered Accountants & Chartered Tax Advisers

29/04/2022

Covering the latest UK tax news affecting UK SMEs, including an update on how businesses can support Ukraine, as well as business tips and local business support for Kent-based businesses.

UK Tax News Items

Making Tax Digital (MTD)

We have covered MTD in some detail in previous HC Bulletins and so just a quick mention that HMRC have updated their ‘Using Making Tax Digital for Income Tax’ (MTDFIT) guidance. They now clarify when a taxpayer can and cannot sign up for MTDFIT.

HMRC state that a UK taxpayer can sign up for MTDFIT if they are:

• a UK resident
• registered with HMRC for self-assessment and up to date with their filed Tax Returns and tax payments due to HMRC
• a sole trader with income from ‘one business only’, or a landlord who rents out UK property

HMRC state that the MTDFIT is not available for a UK taxpayer who needs to report income from sources other than that of a ‘one business’ sole trader or to report to HMRC any other Income Tax liability such as high-income child benefit.

Construction Industry Scheme (CIS)

If you are within CIS and trade through a company, then from April 2022, you must ensure that your company’s unique tax reference (UTR) is reported on the EPS. This is to carry on obtaining a credit for the CIS deducted from your company’s CIS income against your company’s monthly PAYE/CIS liability – via the employer payment summary (EPS). Failure to record the company’s UTR on the monthly EPS will result in HMRC rejecting the CIS credit claim. As stated above, this change in HMRC practice from April 2022 only applies if you are within CIS and trade as a company.

Tax Conditionality Checks

A reminder to certain businesses (see list below) that since April 2022, they are now required to complete a GOV UK check reporting to HMRC how they pay their UK tax liabilities. Failure to complete the GOV UK check will result in the withdrawal of their licence to trade from the relevant local authority.

For existing businesses, check the guidance on the above-mentioned GOV UK check and how they can be completed online.

For a new businesses, their tax information should be reported to the appropriate local authority as part of the business’s application for a licence to trade.

The businesses subject to the above-mentioned Tax Conditionality Checks are as follows:

• Scrap metal dealers: whether a scrap metal dealer operating from a site, or a mobile collector operating for scrap metal dealers.
• Taxi drivers.
• Private hire vehicle drivers and operators.

Plastic Packaging Tax (PPT)

PPT rules started as from 1 April 2022 and HMRC have updated their PPT guidance as to which businesses need to register and how that is done.

To summarise:

• Since 1 April 2022, you must register with HMRC for PPT if you have ‘manufactured or imported’ 10 or more tonnes of plastic packaging within the last 12 months, or if you plan to do so in the next 30 days. This includes non-resident taxpayers who import to the UK finished plastic packaging on their own behalf, or manufacture finished plastic packaging in the UK.
• You must register for PPT within 30 days of becoming liable for it and pay the PPT on all chargeable components from the day you are liable to register. You may need to pay a penalty if you do not complete the PPT registration.
• The rate of PPT has been set at £200 per tonne of plastic packaging which contains less than 30% of recycled plastic and the finished plastic packaging has been manufactured in the UK or imported into the UK.
• Registration for PPT will be required even if a business meets the 30% recycled content threshold and does not need to pay any PPT.

PPT has been introduced to encourage the relevant businesses to use more recycled plastic in their manufacture of finished plastic packaging. Those businesses who use or manufacture plastic packaging need to be aware of their PPT compliance obligations.

Aid to Ukraine

Many UK businesses have looked to donate goods as a way of aiding the people of Ukraine but have been put off by the need to overcome the ‘less than straight forward’ customs and excise rules. The UK Government have now introduced a simplified procedure for the exporting of goods from the UK to Ukraine. UK businesses, charities etc… can now make the necessary HM Custom declaration for the goods to be donated to Ukraine by telephone or by a verbal declaration to a custom’s officer at the UK border.

The Government recommends that UK businesses donate their goods to Ukraine through the Disasters Emergency Committee.

Business news and tips for owners of UK Small and Medium Enterprises (SMEs)

Business support schemes both national and local

The Government has recognised the need for the upskilling of business owners and their employees in order to boost UK business growth, particularly for SMEs. The Government backed scheme highlights the breadth of funding and support available for employers wishing to increase their workforce capabilities and skills in order to support the business’s growth. This scheme includes help for SMEs that have apprentices and trainees. Most of the upskilling courses are free.

Cyber Attacks on SMEs

HaesCooper has previously reported on the need for SME owners to maintain a continual vigilance and investment in upgrades / updates to their business IT systems. This is in view of the ever-increasing number of cyber-attacks happening not just to big businesses in the UK but also UK SMEs. The war in Ukraine has highlighted the Russian involvement in using cyber-attacks as part of their armoury. Although there is nothing specific to report on Russian cyber-attacks towards UK businesses, UK SMEs should be prepared for cyber-attacks from wherever they originate in the World. Visit the National Cyber Security Centre (NCSC) website for guidance.

Local business support news for Kent based SMEs

Free business resources

The Kent Libraries Business & IP Centre (BIPC Kent) is now providing advice on how to access free business resources, training and events to help you improve your business or get your business off the ground.

New bespoke sustainability training programme

‘Growing Green’ has been created to help Kent-based horticultural, food and drink businesses to develop a net zero carbon emission in the production of their plant-based foods and drinks. The ‘Growing Green’ scheme is managed by the National Institute of Agricultural Botany (NIAB). Initially the NAIB is looking for up to 40 Kent based SMEs to take part in their pilot scheme. The scheme will help the businesses to work towards a net zero carbon footprint by building a sustainable action plan which identifies aspects of the business that can be improved. At this final stage there will be grants available to those Kent based SMEs taking part in the ‘Growing Green’ scheme.