Policy News Journal - 2014-15

Van Benefit Charge (VBC) support for zero emission vans Legislation will be introduced in Finance Bill 2015 to extend VBC support for zero emission vans to 5 April 2020 on a tapered basis. Company Car Tax (CCT) The appropriate percentage of list price subject to tax will increase by 2% points for cars emitting more than 75 grammes of carbon dioxide per kilometre (gCO2/km), to a maximum of 37%, in 2017 to 2018 and 2018 to 2019. CIPP comment With the cut for businesses in those who produce not so friendly carbon emissions it will come as no surprise the company car has to pay for it.

National Insurance contributions: simplification for the self-employed The government will introduce legislation when parliamentary time allows to simplify the administrative process for the self-employed by using Self-Assessment to collect Class 2 National Insurance contributions alongside Income Tax and Class 4 National Insurance contributions. These changes will take effect from April 2016; however customers will start to see the benefits after April 2015.

CIPP comment The Office for Tax Simplification (OTS) recommended that class 2 NICs be moved into Self-Assessment and this has now been approved by government.

Tax avoidance and non-compliance At Autumn Statement 2013, the government announced that it would, following consultation, introduce a new requirement for taxpayers to pay disputed tax upfront where the avoidance scheme being used has been defeated in another party’s litigation through the courts. Tax avoidance scheme promoters must give HMRC information about schemes they promote under the Disclosure of Tax Avoidance Scheme (DOTAS) rules. Anyone using such a scheme must declare to HMRC they are using a notified tax avoidance scheme. Following consultation, the Budget announced that the government intends to extend the new requirement for taxpayers to pay upfront any disputed tax associated with schemes covered by the DOTAS rules or counteracted under the General Anti Abuse Rule (GAAR). CIPP comment “Most individuals and businesses throughout the UK pay the tax they owe upfront.” This is not news to us as every time the government talk about this, they are talking about the persistent minority who seek to avoid their responsibilities, preventing the tax system from raising revenue fairly and imposing costs on all taxpayers. The Chancellor also said registered tax avoidance schemes had fallen by half in the past year. Also mentioned was an increase to HMRC's budget to help tackle non- compliance and give them modern powers to collect debts from bank accounts. This will be the subject of future consultation and we will be looking at the detail on this very closely.

Further information on tax evasion and avoidance

CIPP Policy News Journal

08/04/2015, Page 40 of 521

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