Anna’s Accountancy Alerts – Week 3 (18th – 24th April 2022)

Anna’s Accountancy Alerts - Week 3 (18th – 24th April 2022)

HMRC’s approved mileage allowances

With fuel prices increasing, you may be thinking of paying a higher rate than the HMRC rate but will it trigger extra Tax and NI?

The excess over HMRC’s approved mileage allowance is taxable as a benefit in kind and liable to Class 1 NI contributions as extra salary. Where currently you do not pay your employees a subsistence or other travel-related allowance, paying one at HMRC approved rates can provide employees with extra tax and NI-free cash as a top up to the mileage allowance.

Read more here.

VAT record keeping requirements

Normally, HMRC expects you to have the right paperwork, or digital equivalent, to back up every purchase transaction for which you reclaim the VAT paid.

You don’t need physical or digital records to reclaim VAT on off-road parking, road tolls and telephone calls if the cost doesn’t exceed £25. For purchases up to £250 a receipt showing the supplier, the goods supplied and the VAT rate and VAT number is OK.

TAX bills

More than 142,000 taxpayers have used HMRC’s online time to pay facility to spread the cost of their self assessment tax bill since April 2021.

The self assessment deadline for 2020/21 tax returns was 31 January but, this year, HMRC gave taxpayers until 1 April to pay any tax owed and not face the automatic £100 penalties.

Any self assessment taxpayers who did not pay their outstanding tax by 1 April will now face a 5% late payment penalty on any outstanding tax. From 1 February 2022, all outstanding amounts were subject to interest.

Taxpayers wishing to file their 2021/22 tax return can do so from 6 April 2022. Last year, more than 63,500 customers filed their 2020/21 tax return on the first day of the tax year.

Over 11.3 million taxpayers filed their 2020/21 tax return by the revised deadline of 28 February 2022.

Stay Up-To-Date With Coronavirus & Brexit News

Coronavirus has affected us all. Whether you’re a sole trader, employer or employee. Stay up to date with the latest news – including government support, tax implications, and more.