Welcome to the March 2022 Newsletter from Beatons Group

The Confederation of British Industry (CBI) has urged the government to do more to help protect businesses from rising energy costs.

Meanwhile, the National Audit Office (NAO) has warned that the size and complexity of the UK private sector makes the extension of IR35 and compliance with the measure an issue.

CBI says government must protect businesses from rising energy costs

The government must do more to protect businesses and industry from rising energy prices, according to the Confederation of British Industry (CBI).

The plea follows the decision by regulator Ofgem to increase the energy price cap for households by £693 in England, Wales and Scotland from April. The increase will cause bills for the average customer to rise to £1,971.

Chancellor Rishi Sunak has outlined plans to soften the blow via council tax rebates and help with bills. The plans will mean a £200 discount on energy bills for households from October, which will be paid back over next five years at £40 per year starting in April 2023.

In England, households in council tax bands A to D will get a £150 discount from April. Funds for the equivalent discounts will be provided to devolved nations in the UK.

Matthew Fell, CBI Chief Policy Director, said: 'Short-term support must go hand-in-hand with a revamped retail energy market, setting a higher bar for market access and tougher stress testing for suppliers.

'Businesses too have been impacted by high-cost pressures, so steps to protect cashflow for smaller firms and heavy industry should follow [the] announcement.'

Off-payroll rule compliance an issue for HMRC

The size and complexity of the private sector means that the extension of off-payroll rules, commonly known as IR35, makes compliance a problem for HMRC, the National Audit Office (NAO) has warned.

A NAO report said that labour markets in the private and third sectors are larger, which makes monitoring non-compliance a bigger challenge.

HMRC estimates that the 2021 extension of the reforms to the private sector will affect around 180,000 personal service companies (PSCs), almost four times the number affected by the 2017 public sector reforms. This creates a bigger challenge for HMRC to identify and monitor risks of non-compliance.

Complex supply chains are more common in the private and third sectors, creating a greater risk of companies making errors when determining tax status, and of the reforms resulting in workers changing careers or business moving overseas.

Gareth Davies, Head of the NAO, said: 'The 2017 reforms to IR35 tax rules have achieved their primary purpose of reducing non-compliance. However, HMRC did not give public bodies sufficient time to prepare for the roll-out, and it was highly likely that mistakes would be made.

'While key lessons were applied during the wider rollout in 2021, inherent differences in labour markets create new challenges that HMRC will need to manage for the reforms to be a success.'

ESSENTIAL TAX DATES FOR MARCH

1 March
New Advisory Fuel Rates (AFR) for company car users apply from today.         

3 March
5% late payment penalty on any 2020/21 outstanding tax which was due on 31 January 2022 and still remains unpaid.

19 March
PAYE, Student loan and CIS deductions are due for the month to 5 March 2022.

31 March
End of corporation tax financial year.
End of CT61 quarterly period.
Filing date for Company Tax Return Form CT600 for period ended 31 March 2021.
Last minute planning for tax year 2021/22 - please contact us for advice.

QUOTE OF THE MONTH

'The UK is the first major economy that needs to come up with an alternative to road tax as we are ruling out new petrol and diesel vehicles from 2030.'

Huw Merriman, Chair of the Transport Committee, commenting on the call for road pricing to replace motoring taxes.   

ON OUR WEBSITE

A wealth of resources for businesses
With topics ranging from the Bribery Act 2010 to the National Minimum Wage and the National Living Wage, the Your Business section of our site is a hub of essential information.

Useful information for individuals
For a comprehensive bank of guides covering Venture Capital Trusts, the dividend nil-rate and much more, please visit the Your Money area of our website.

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