HMRC Stakeholder Digest - 29 November 2024

Please see the following message from HMRC, which we are sharing for information:

The HMRC Stakeholder Digest provides a monthly round-up of our latest news and updates. We’d be grateful if you would share relevant information with your clients or members.

Paying voluntary National Insurance Contributions could boost your State Pension

Help people increase their State Pension by sharing important information about filling gaps in their National Insurance (NI) records. 

People have until 5 April 2025 to make voluntary contributions to cover gaps dating back to 6 April 2006. After April 2025, they will only be able to fill gaps for the previous 6 tax years.

Basis Period Reform: reporting on a tax year basis

From April 2024, sole traders and partners in a business will have to report their profits on a tax year basis, if they don’t do so already. This is also known as Basis Period Reform.

We have updated our online guidance (which now also supports individuals reporting trading income from a partnership) to support completion of the Self Assessment tax return and working out transition profit in 2023-24 on GOV.UK.

To ensure your clients or members meet the filing deadline of 31 January 2025, advice is to file with a 'provisional figure' for overlap relief and amend it when confirmation is received from HMRC.

You and your clients or members can find further guidance to get help with basis period reform on GOV.UK.

VAT on private school fees

The Government has announced that school and boarding fees will be taxable at the standard rate of VAT of 20%. This will be for school terms starting on or after 1 January 2025.

Schools can find important information on when and how to register for VAT, including what details they need to input during registration online.

They can also check if they need register for VAT if they receive private school fees on GOV.UK.

They can also watch our recorded webinar for VAT which explains how to recognise the goods and services they need to charge VAT on and reclaim VAT for online.

Simple Assessment: reminder to pay

We are reminding more than half a million taxpayers who have received a Simple Assessment letter to pay by the forthcoming deadline, if they haven’t already done so.

Anyone who has received a Simple Assessment letter will have a payment deadline of either 31 January 2025 or three months from the date of issue of the letter, whichever is later.

We send Simple Assessment letters to people who owe Income Tax that cannot be collected automatically (for example, through Pay As You Earn) and who are not in Self Assessment.

There are various ways to pay, including via the HMRC app, online, by bank transfer, or by cheque. Anyone who anticipates difficulty paying on time should contact HMRC so we can provide practical advice and support. They can find details about how to contact HMRC with Income Tax general enquiries on GOV.UK.

For more information, customers can refer to their Simple Assessment letter or view more information on paying their Simple Assessment tax bill on GOV.UK.

Please consider sharing this information with your clients or members, should they approach you with Simple Assessment queries.

HMRC compliance consultations update

In the Autumn Budget 2024, the Government outlined the next stages of modernising and reforming HMRC’s tax administration framework (TAFR). This includes: 

• A Summary of Responses responding to the spring 2024 call for evidence regarding HMRC’s enquiry and assessment powers, penalties and safeguards on GOV.UK.
• A consultation on new ways to tackle non-compliance, inviting views on HMRC’s approach to correcting taxpayer inaccuracies in a claim or return and whether there are ways this could be improved. Responses to the consultation should be sent to [email protected].
• In spring 2025, HMRC plan to announce a consultation on making better use of third-party data that builds on the TAFR information and data call for evidence and this is available to read on GOV.UK.

Messages on behalf of other government departments:

The Valuation Office Agency is sharing more information on business rates valuations

The Valuation Office Agency (VOA) has published details about how it will improve the information it discloses on business rates valuations.

The VOA will share improved information on business rates valuations in phases from 2026. 

This is part of a wider set of changes that are coming to business rates in England from 2026 to 2029.These changes are being introduced in stages. 

There is no action ratepayers need to take now. The VOA will give ratepayers plenty of notice ahead of the changes and help them to get things right.

Please share the VOA news story on sharing more information on business rates valuations  on GOV.UK with your clients or members.