Declining
with the recession
August 2008
For advice to counter the present economic climate, click
here, to read our current published article.
Confusion
Over Effect of Tax and Inflation on Savings
July 2008
Research from National Savings and Investments (NS&I) implies
that UK residents are not clued up about the effects of inflation
and tax on their savings accounts.
Even
though the credit crunch is discussed in the media on a daily basis,
people aren't aware of the implications of economic turmoil for their
savings accounts.
"It
is concerning that many people don't understand what inflation is."
said John Prout, sales director at NS&I. "Inflation means
that prices increase over time, so £100 today will buy you a
little bit less in a year's time. It can be caused by increases in
salaries, increased demand for items or a decrease in supply which
all push prices up.
"People
are more likely to think about how inflation affects the price of
their shopping basket, but not how it affects the value of their savings.
The RPI is one of the measures of inflation and with it averaging
3.98% last year if we don't put our savings in a tax free account
matching or a non tax free account beating this rate then our money
will be worth less in the future.
Bank
of England Maintains Bank Rate at 5.0%
8 May 2008
The
Bank of England's Monetary Policy Committee today voted to maintain
the official Bank Rate paid on commercial bank reserves at 5.0%.
The
Committee's latest inflation and output projections will appear in
the Inflation Report to be published on Wednesday 14 May.
Are
you eligible for a repayment of overpaid VAT?
April 2008
In a
recent case, the House of Lords ruled that the three year capping
procedures which came into force in 1996 were introduced illegally.
HM Revenue & Customs (“HMRC”) has accepted the decision.
It should now be noted that the three year cap is legal but a transitional
period for submission of claims should have been given.
HMRC
has said that claims may be submitted for overpaid output tax or under
claimed input tax until 31 March 2009. After that the drawbridge will
come down.
If you
feel you are eligible to make a claim please contact our tax department
on 0161 655 2000.
Gratuitous
tax demand threatened on tips?
Waiters, waitresses and bar staff may soon have to start paying National
Insurance on tips. The Inland Revenue is targeting restaurants in
an attempt to reclaim thousands of pounds in National Insurance Contributions
(NICs) on tip payments to staff. Tips held and distributed through
what’s known as the ‘Tronc system’ - where tips are
pooled centrally and distributed to employees - escape NICs provided
Inland Revenue rules are followed. Accountants
are warning of an upsurge in Inland Revenue investigations and their
claims that restaurants are making errors in the system, meaning that
NICs are due. The Revenue’s attempts have been bolstered by a
ruling in the European Court of Human Rights that tips paid by cheque
or credit card are the property of the employer, and can form part
of the basic staff wage. Tax investigations specialists have said
that restaurants using the Tronc system are “highly likely”
to be on the IR’s hit list for reclaiming NICs.
