HMRC Stakeholder Digest - 3 April 2024
Please see the following message from HMRC, which we are sharing for information:
The HMRC Stakeholder Digest provides a round-up of our latest news and updates, which we’d be grateful if you could share with your clients, customers, or members.
Latest news and updates
Call for evidence on raising standards in the tax advice market
A consultation on raising standards in the tax advice market was launched at Spring Budget 2024.
The consultation explores:
- strengthening the regulatory framework, including a proposal to require tax advisers to join a professional body; and
- requiring tax advisers to register with HMRC if they wish to interact with HMRC on a client’s behalf.
You can find the consultation on GOV.UK and can email your views to [email protected].
The consultation closes on 29 May 2024.
We are keen to hear from anyone who has an interest in these proposals, to inform the government’s decision on the next steps.
Changes to National Insurance Contribution rates to take effect on 6 April 2024
The Chancellor announced in his Budget on 6 March 2024:
- a cut to the main rate of Class 1 employee National Insurance Contribution (NICs) rate from 10% to 8%
- a further 2p reduction to the main rate of Class 4 NICs for the self-employed, on top of the 1p cut to 8% previously announced at Autumn Statement, which means the rate is reduced from 9% to 6%.
Also taking effect on 6 April are self-employed NICs changes announced previously in the Chancellor’s Autumn Statement 2023. The government is simplifying the NICs system for the self-employed who have, to this point, been required to pay two separate charges for NICs, under both Class 2 and Class 4 in order to access contributory benefits. From 6 April, these Class 2 contributions will no longer be compulsory but can be paid voluntarily.
HMRC guidance will be updated shortly, and the government will consult on the details of the Class 2 reform later this year.
You can read more about National Insurance changes in the Spring Budget Personal Tax Factsheet and self-employed National Insurance rates on GOV.UK.
Child Benefit changes from 6 April
High Income Child Benefit Charge
The threshold at which people start paying the High Income Child Benefit Charge (HICBC) will increase from £50,000 to £60,000 from 6 April, and the taper will be extended up to £80,000.
For instance, you’ll be charged 1% of your Child Benefit for every £200 of income that exceeds £60,000. If your income exceeds £80,000, the charge is equal to the amount of the Child Benefit payment.
Parents who have not claimed Child Benefit, or who have claimed it but opted out of receiving it, and who earn between £60,000 and £80,000, will now benefit from claiming and receiving Child Benefit.
People in this category are advised to wait until after 6 April 2024 before acting, to prevent having to pay the charge for the 2023-24 tax year.
The quickest and easiest way to get payment from 6 April is through the free HMRC app or online.
Child Benefit rates
To help boost family budgets, the amount parents will receive for their first child is increasing to £25.60 per week and £16.95 for each additional child. There is no limit on the number of children parents and carers can claim for.
We’d really appreciate your support in sharing this information with your networks, so they can support parents in claiming or opting into payments from the 6 April on the HMRC app or online.
Stopping paper repayment notifications for Corporation Tax and Self Assessment
We’re changing how we let customers know we’ve issued a repayment by:
- BACS – Corporation Tax
- Credit/debit card – Corporation Tax and Self Assessment
From 8 April 2024, we’ll no longer send a letter notifying customers or their agents of a repayment, as these letters often arrive after the repayment has been made, leading to confusion and increased contact from customers. We stopped sending Self Assessment notifications for BACS repayments in December 2023.
Customers will still receive repayments into their chosen bank account or credit card balance as usual, and can see any transactions in their online account on GOV.UK.
Agents can also review transactions on their clients’ behalf using HMRC’s online services for agents account on GOV.UK.
All routes now open for Customs Declaration Service (CDS) export migration
All businesses are now able to make their export declarations to the Customs Declaration Service (CDS).
On 4 March 2024 we contacted affected businesses to let them know that they have until Tuesday 4 June 2024 to move to the CDS.
After this date, businesses will no longer be able to make customs declarations to the old Customs Handling of Import and Export Freight (CHIEF) system.
Further information about the Customs Declaration Service is available on GOV.UK.
Creative Industry Tax Relief: Expenditure Credits
On 1 January 2024, two new tax reliefs were introduced: the Audio Visual Expenditure Credit (AVEC) and the Video Games Expenditure Credit (VGEC). These replace the existing reliefs available for films, TV programmes and video games.
Eligible existing productions can choose to claim the new reliefs in their first tax return for an accounting period ended on or after 1 January 2024. Existing reliefs (Film, High-end TV, Children’s TV, Animation and Video Games) will continue until 31 March 2027, but will not be available to new productions from 1 April 2025.
From 1 April 2024 all claims must be submitted online in a Company Tax Return, and be accompanied by an additional information form.
Further information about the new reliefs and full guidance on how to claim can be found on GOV.UK.
HMRC webinar: Litigation and Settlement Strategy (LSS)
If you’re interested in how we use the Litigation and Settlement Strategy (LSS) to resolve tax disputes through civil law, you can watch our recent webinar which explains the key principles of the LSS and how these ensure that we treat customers consistently.
Alcohol Duty digital service launch date revealed
The launch of the new digital service for Alcohol Duty has been set for March 2025.
The digital service will simplify and modernise the Alcohol Duty approval, return, and payment processes for UK producers.
We will share further details on the new digital service closer to its launch date, including details on how to access it.
More information
For further information on Alcohol Duty, read the guidance in English / Welsh, or watch the recorded webinars on GOV.UK.
Small producers can use the Small Producer Relief calculator to work out how much they owe.
HMRC Stakeholder Conference 2024
On Thursday 29 February, we were pleased to welcome many of you to our annual stakeholder conference at the Queen Elizabeth II Centre, Westminster.
Following an opening address from the Financial Secretary to the Treasury, Nigel Huddleston and plenary speeches by HMRC Permanent Secretaries, Jim Harra and Angela MacDonald, a number of workshops took place covering a range of subjects, such as, compliance, tax simplification, the role of intermediaries in reducing the tax gap, and generative artificial intelligence.
The event generated lots of constructive discussion about how we can work together to improve the tax and customs system, and some ambitious shared actions were identified.
HMRC workshop teams, and the external co-chairs who helped facilitate workshops, are reviewing the proposals that came out of their workshops and will agree an action plan to be taken forward through our existing engagement forums. We will share an overview and regular updates on these actions in future digests.
If you weren’t able to join us on the day, you can watch the opening address from the Financial Secretary to the Treasury and the Permanent Secretaries’ keynote speeches on YouTube.
Other consultations now open for responses
Call for evidence on the Tax Administration Framework Review
We are seeking responses to our call for evidence: The Tax Administration Framework Review: enquiry and assessment powers, penalties, safeguards.
The consultation closes on 9 May 2024, and stakeholders are invited to join online workshops to discuss the topics in detail:
- Enquiry and Assessment Powers: 9 April (10:30-12:00) and 18 April (10:30-12:00). These two sessions cover different material.
- Safeguards: 16 April (10:30-12:00)
Workshop invitations can be requested via: [email protected]
Workshops covering penalties material have already taken place. If you are interested in speaking to us about penalties, or any areas of the consultation, please use the mailbox listed above.
Call for evidence on the introduction of a UK carbon border adjustment mechanism
HMRC and HM Treasury have published a consultation document entitled ‘Introduction of a UK carbon border adjustment mechanism (CBAM) from January 2027’ which sets out the government’s detailed proposals for the policy’s design.
CBAM will apply to embodied emissions in specified goods imported to the UK from the following sectors: aluminium, cement, ceramics, fertilisers, glass, hydrogen, and iron and steel. It will ensure highly traded, carbon-intensive products from overseas face a comparable carbon price to that paid if the goods were produced in the UK.
The consultation closes on 13 June 2024.