New £1 coin in use from 28 March 2017 GENERAL

The new £1 coin entered circulation on 28 March 2017 and is now legal tender. The new £1 coin is 12-sided and will replace the round shaped £1 coin that has been in use for 30 years. The new coin has being introduced to help combat the use of counterfeit coins and will, according to the Royal Mint, be the most secure coin in the world.

The new coins are being produced by The Royal Mint, in South Wales, at a rate of up to four million per day and should start appearing regularly over the coming days and weeks. However, there are concerns that some vending machines and supermarket trolleys are not yet ready for the new coin meaning that some machines will only take the new coin and some only the old.

It has been estimated that as much as £1.3 billion worth of coins are stored in savings jars across the country and the £1 coin is thought to account for a third of this amount. The new and old coins will continue to be in circulation together for a six-month period from 28 March until 14 October 2017. From 15 October 2017, the old round £1 coin will lose its legal tender status.

The features of the new coin include hidden high security features to combat counterfeiting as well as a hologram-like image that changes from a ‘£’ symbol to the number ‘1’ when the coin is seen from different angles.

Commenting on the launch of the new coin, the Commercial Secretary to the Treasury, Baroness Neville Rolfe said:

‘Today marks the start of the six-month transition period, so I’d urge everyone to make sure they spend, return or donate their old round pounds before 15 October. We have been working hard with businesses over the last three years to help make this changeover as smooth as possible.’

Forthcoming changes to the Immigration Rules

The government has published a new statement of changes in the Immigration Rules, setting out various changes that will come into effect from 6 April 2017. They key changes are:

  • A confirmation that a sponsor’s failure to pay the new immigration skills charge will mean that the relevant Certificate of Sponsorship will be considered invalid and the worker’s Tier 2 application will be refused.
  • The minimum salary requirement for experienced workers applying for a Tier 2 (General) visa will increase to £30,000 (the minimum for new entrants remains at £20,800 a year).
  • The minimum salary requirement for high earners (where there is an exemption from conducting a resident labour market test) will increase to £159,600 a year.
  • The Tier 2 Intra-company Transfer Short-Term Staff category will close to new applications.
  • The requirement for an intra-company transferee to work for a sponsor’s related overseas company for at least one year will not apply to those earning £73,900 or more a year.
  • The salary requirement for intra-company transferees wishing to extend their total stay for up to nine years is being reduced to £120,000, from the current level of £155,300.
  • Workers (and their adult dependants) coming to the UK under Tier 2 (General) to work in roles in the education, health and social care sectors will be required, as part of the visa application process, to submit overseas criminal record certificates from the countries that they have lived in over the last ten years.
  • Where the role is associated with the relocation of a high-value business to the UK or a significant new inward investment project, where the sponsor is a newly-registered (within the last three years) branch or subsidiary of an overseas business and the investment involves new capital expenditure of £27 million or the creation of at least 21 new UK jobs, it will not be necessary to conduct a resident market labour test or to assign a restricted Certificate of Sponsorship.

A migrant who overstays their leave in the UK by more than 30 days will be banned from returning to the UK for one year (currently, migrants who overstay for more than 90 days are banned).

Payroll giving

 

Payroll giving was introduced in 1997 to encourage employees to allow employers to deduct charitable donations from their pay before PAYE. The scheme allows taxpayers to make a tax free donation to charity directly from their pay or pension if their employer runs a payroll giving scheme which has been approved by HMRC.

Donations made using payroll giving are made after National Insurance has been deducted but before Income Tax deductions. This allows taxpayers to obtain an immediate tax deduction at their highest tax rate. This is especially beneficial for higher rate taxpayers. In 2015-16, over £130m was donated to UK charities through the scheme.

HMRC has updated its list of Payroll Giving Agencies that can help employers to promote Payroll Giving in the workplace, whether using a professional fundraising organisation, staff champions or a chosen charity. The list only includes agencies that have asked to be listed.

Non-domiciles living in the UK

In July 2015, George Osborne announced measures to reduce the availability of non-domicile status to those living a substantial amount of time in the UK. These measures are effective from April 2017, and will affect any person who has been resident in the UK for more than 15 of the previous 20 years – they will be deemed to be domiciled in the UK for tax purposes.

In addition, individuals, who are born in the UK, to UK domiciled parents, will no longer be able to claim non-domiciled status whilst they are resident in the UK from April 2017. This measure is intended to prevent those with the most significant links to the UK from returning here from abroad and claiming non-dom status.

Non-doms that wish to retain access to the remittance basis of taxation must pay an additional sum in addition to the tax on any income or gains remitted. This sum is known as the Remittance Basis Charge (RBC). The RBC charge for individuals who have been UK resident for at least 7 of the last 9 years is £30,000. The charge for individuals who have been resident in the UK for at least 12 of the last 14 years is £60,000.

The £90,000 RBC that was payable by individuals who had been resident in the UK for at least 17 of the last 20 tax years is no longer available from the new tax year as under the new rules these non-doms will be deemed domiciled in the UK for tax purposes.

The government had also announced that provisions would be put in place to ensure that income and gains arising in overseas trusts created by foreign domiciled persons before they become deemed domiciled under the new rules will not be taxed if they are retained in the trust or its underlying entities. Some of these provisions are included in the recently published Finance Bill. Due to time constraints some further changes including the recycling rule will be delayed and included in a future Finance Bill giving some respite to non-doms until at least April 2018.

Companies House – late filing penalties

There are late filing penalties which are designed to encourage companies to file their accounts and reports on time. The penalties were introduced in 1992 and were significantly increased from February 2009. All companies, private and public, large or small, trading or non-trading must send their accounts to Companies House. The late filing penalties guide (GP5) has been updated.

The table of penalties for late submission is as follows:

How late are the accounts delivered Penalty – Private Company Penalty – PLC
Not more than one month £150 £750
More than one month but not more than three months £375 £1,500
More than three months but not more than six months £750 £3,000
More than six months £1,500 £7,500

Failure to file annual returns or accounts is a criminal offence which could see the directors personally fined in the criminal courts. Late penalties which are unpaid will be referred to collection agents and could result in a County Court judgement or a Sheriff Court decree against the company.

It is possible to appeal against a penalty, but it will only be successful if the appellant is able to demonstrate that the circumstances of the late filing were exceptional.

Money Laundering Regulations

The Money Laundering Regulations (MLR) are designed to protect the UK financial system and put in place certain controls to prevent businesses being used for money laundering by criminals and terrorists.

Many businesses are monitored by the Financial Services Authority or certain professional bodies. However, businesses that HMRC is responsible for supervising should be aware of the requirement to register with HMRC and the penalties for not doing so.

HMRC is responsible for supervising the following five business types:

  • Money Service Businesses (MSBs)
  • High Value Dealers (HVDs)
  • Trust or Company Service Providers (TCSPs)
  • Accountancy Service Providers (ASPs)
  • Estate Agency Businesses (EABs)

The online service for registration and renewals is currently unavailable. HMRC expects the service to be available again from 3 April. This means that those planning to renew won’t be able to do so before 1 April. HMRC has confirmed that as long as the renewal is completed before the end of April 2017 no penalties will be charged for late renewal.

SDLT filing and payment dates

HMRC has published a response to last year’s consultation document on proposed changes to the filing and payment deadlines for Stamp Duty Land Tax (SDLT). The main proposal concerned the filing and payment period for SDLT.

SDLT is a tax that is payable on the purchase or transfer of land and property in England, Wales and Northern Ireland. In Scotland, SDLT was replaced by Land and Buildings Transaction Tax from 1 April 2015. In Wales, SDLT will be replaced by Land Transaction Tax from April 2018.

The changes, if written into legislation, will see the time given to make SDLT filings and payments reduced from 30 days to 14 days. The new measure was expected to come into effect between 1 January 2018 and 1 March 2018.

This timeline has now been delayed in order to make it easier for those affected to comply with their obligations in respect of complex commercial transactions. There had been concerns that the time limit would be difficult to meet in the case of some complex commercial transactions and for deferment applications.

The government will now delay the introduction of the 14 day filing and payment window from 2017-18 to 2018-19. The new implementation date will not be before April 2018 with the exact time frame to be communicated in advance. There may also be allowances made for complex transactions.