Welcome to the April 2013 Newsletter from Connolly Accountants Ltd

George Osborne's 2013 Budget may have been relatively modest in comparison to last year's infamous and much-debated Budget Statement, but there were nevertheless some important talking points to emerge in the wake of the Chancellor's speech. Notably, the Government's headline 'Help to Buy' scheme has sparked fierce criticism over concerns that it may be exploited by second home buyers, while the House of Lords has blocked the proposed 'shares for rights' plan, which would allow employees to forfeit some of their employment rights in return for company shares.

More positive, however, was the release of further details on the new Business Bank, which aims to boost and diversify lending to small and medium-sized enterprises. Business groups have applauded the move, with the Confederation of British Industry hailing the Bank as a 'long-term solution' to the UK's lending crisis.

Meanwhile, there was some welcome news for small employers after HMRC announced that it will temporarily relax the reporting rules under Real Time Information (RTI). The decision follows concerns that some employers may struggle to comply with the new RTI regime when it is introduced on 6 April.


Small businesses set for boost as Business Bank details are unveiled

Business Secretary Vince Cable has outlined further details of the Government's plans to introduce a new state bank in order to help small businesses to secure finance.

The new Business Bank will bring billions of pounds of aid together in a 'one stop shop', managing £2.9bn of existing Government debt and equity schemes, together with an additional £1bn for areas such as non-bank lending.

As part of the plans, three lenders - Market Invoice, URICA and Beechbrook Capital - will gain access to £30m of funds to boost lending to small and medium-sized businesses.

The money comes from the small business tranche of the Business Finance Partnership, a programme set up by the Government to ease the flow of credit to businesses by helping to diversify the sources of finance available to them.

It is hoped that the new Business Bank will also attract money from private investors, which could boost the pool of credit to an estimated £70m.

Announcing the details, Mr Cable said, 'Inadequate access to finance for small and medium-sized enterprises is one of the biggest risks to economic recovery. We need bold action to fix what has always been a weakness of the UK economy, and since the financial crisis, has become an urgent problem'.

The Confederation of British Industry (CBI) welcomed the announcement. CBI Chief Policy Director Katja Hall commented, 'This should give confidence to businesses that there is now a long-term solution to plug the finance gap for patient capital in the UK.

'Bringing all government financial support and advice initiatives under one roof will improve access for smaller firms, helping them fulfil their growth potential'.

The British Chambers of Commerce (BCC) agreed that the timetable for implementation of the bank will boost the confidence of growing companies.

Dr Adam Marshall, BCC Director of Policy, said, 'Now that a firm timetable for its delivery is in place, businesses will begin to feel that the promised business bank is starting to get momentum'.

However, Dr Marshall called on the bank to address the long-term structural gaps in the business finance market, by lending directly to growing companies that have previously failed to obtain growth capital, and by injecting more capital into the bank.

Mr Cable has confirmed that the bank will start investing in September and is due to be fully operational by the second half of 2014.


HMRC relaxes RTI reporting arrangements for smaller businesses

Businesses with fewer than 50 employees will benefit from a temporary relaxation of the Real Time Information (RTI) reporting arrangements, HMRC has revealed.

Ahead of the introduction of RTI on 6 April, HMRC acknowledged that certain employers may need longer to comply with the new requirements.

Until 5 October 2013, employers with fewer than 50 employees who pay their staff weekly or more regularly and find it difficult to report at the time of payment may now send information by the date of their regular payroll, but no later than the end of the tax month.

The move has been largely welcomed by professional bodies. Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, said, 'Deferring RTI requirements until October is a sensible approach and it is encouraging that HMRC has listened to the accountancy and payroll sectors' collective voice on this matter and acted with common sense'.

HMRC has confirmed that for 2012/13, penalties will not be applied for inaccuracies found within the in-year Full Payment Submission (FPS). However, they may be charged after the end of the tax year based on the final FPS for the year.

Penalties may also apply for inaccuracies found within the in-year returns for the 2013/14 tax year, using existing criteria. From 6 April 2014 there will be new late filing and late payment penalties.

The Revenue will continue to assess the impact of RTI on the smallest businesses throughout the summer.

To discuss the impact of the new RTI regime on your business, please contact us. We would welcome the opportunity to advise on your individual circumstances.


ESSENTIAL TAX DATES FOR APRIL

5 April
Last day of 2012/13 tax year.
Deadline for 2012/13 ISA investments.
Last day to make disposals using the 2012/13 CGT exemption.

14 April      
Due date for income tax for the CT61 period to 31 March 2013.

19/22 April
Quarter 4 2012/13 PAYE remittance due.

20 April       
Interest will begin to accrue on unpaid PAYE/NI for 2012/13.

30 April       
Normal annual adjustment for VAT partial exemption calculations (monthly returns).


QUOTE OF THE MONTH

'To remove this clause today would be an act of mercy to the Government, let alone to the employees adversely affected by it.'

Lord Adonis, commenting on the Lords' rejection of Government proposals to allow employees to trade employment rights for shares, under the so-called 'shares for rights' scheme.


WEBSITE OF THE MONTH

www.startupbritain.co

Home of the Government's campaign to encourage entrepreneurism.


ON OUR WEBSITE

View our summary of the 2013 Budget
Click here to view our summary of the key points from the Chancellor's Budget.

2013/14 tax rates and allowances
Visit the tax section of our website for details of the new tax rates and allowances coming into effect from 6 April.

Single-tier pension and social care cap brought forward by a year
Plans to overhaul the state pension system will be brought forward by a year, Chancellor George Osborne has announced.
Click here for the full story

Thousands of entrepreneurs receive support under Start-Up Loan scheme
The Government's Start-Up Loan scheme has exceeded expectations, with more than 2,000 young entrepreneurs receiving support under the initiative.
Click here for the full story

New campaign to recoup undeclared profits on second home sales
Residential landlords are the subject of a new HMRC campaign to recoup undeclared profits on the sale of second homes.
Click here for the full story

New code to help retirees understand their pension options
Individuals approaching retirement are to be given more guidance to help them make an informed decision about their pension options.
Click here for the full story

Whistleblowers to receive greater protection
Whistleblowers are set to receive greater protection against bullying and harassment in the workplace, following amendments to the Enterprise and Regulatory Reform Bill.
Click here for the full story