PENSION SCHEME CONTRIBUTIONS
NEW 3 YEAR CARRY FORWARD
Yet more news on the pension scheme tax relief regime from 6 April 2011. It is now apparent that if you do not use all of your new £50,000 annual contribution limit you can carry it forward for a maximum of 3 years. This gives plenty of all-important flexibility, to take into account your particular needs and resources. Although this new rule does not come in until the start of the next tax year, you can use it to cover the earlier tax years 2008/09, 2009/10 and 2010/11 by carrying forward unused relief in those years to pay up to 3 years’ later. We will be pleased to show you how this would work in your specific circumstances, thus ensuring you get tax relief at your top rate on pension contributions.
PENALTIES FOR LATE CIS CONTRACTOR MONTHLY RETURNS
In many cases from October 2011 the new penalties will be less than charged now. That’s a refreshing surprise, where in particular for new CIS contractors there will be an upper limit to some of the penalties that are charged. This upper limit will apply when new contractors first send a monthly return, if that return and any other monthly returns that are sent at the same time are late. Although the new penalties do not start until October 2011, any contractor who has been, or is, charged penalties for late filing of a monthly return before that date may ask HMRC to work out how much the penalties would be under the new rules and, if less than the amount already charged, agree that their penalties should be reduced to the lesser amount. If only they took the same line with all penalties within the tax system!
COMPANY CARS ADVISORY FUEL RATES
If you have the use of a company car, the chances are that you do not receive any fuel for private use as the separate tax charge is generally well in excess of the real benefit. You probably therefore pay for all fuel in the company car and then claim reimbursement from your employer of the business use fuel. Published guidelines are issued by HMRC involving advisory fuel rates per business mile. They are reviewed every 6 months, but more frequently at HMRC’s consideration if fuel prices fluctuate by 5% from the current rate and that is likely to be sustained. From 1 December 2010 the rates have been changed based on petrol at 119p per litre: It is frustrating to find that the rate used from 1 December is 119p per litre when in fact just a few days later the price went up to several pence above that level.