Motor Trade Tax Update

Presented byMatthew Hodgson Michelle Malone

Summary

2013 Budget and VAT Update

Pensions Auto-Enrolment

National Minimum Wage Increase

HMRC Anti- Money Laundering Checks

General Anti-Abuse Rule (GAAR)

2013 Budget Update

Income tax

Personal allowance 2013/14 - £9,440 but £10,000 from 2014/15

Additional rate (income over £150,000) reduced from 50% to 45% (dividend rate reduced from 42.5% to 37.5%) from 2013/14

Corporation tax

Previously announced rate reduction for 2013 unchanged at 23% (2014 – 21%)

Marginal rates 2013 – 23.75% (2014 – 21.25%)

Headline measure reduction in main rate of corporation tax to 20% from April 2015

2013 Budget Update - Continued

Capital allowances

Annual investment allowance - £250k pa from January 2013 (2012 – various changes leading to apportionment but reduced from £100k to £25k in April 2012)

Low emission cars

Extension of 100% FYA to March 2018 but reduction in emissions threshold from April 2013 to March 2015 from 110 g/km to 95g/km then reduced to 75 g/km

Threshold main pool car reduced from 160 g/km to 130 g/km from April 2013 (also applies to lease rental restriction) – otherwise put in special rate pool

Approved Mileage Rates – Business Use of Company Vehicle – from 1 March 2013

Engine Size Petrol Diesel LPG1400cc or smaller 15p 13p 10p1401cc to 1600cc 18p 13p 12p1601cc to 2000cc 18p 15p 12pOver 2000cc 26p 18p 18p

VAT

New fuel scale charge rates applying from 1 May 2013

New forms

VAT 411 Sale of New Means of Transport

Declaration for zero rating sales of adapted vehicles

Purchase of vehicles from abroad – requirement to register vehicles from 15 April 2013 using NOVA (Notification of Vehicle Arrivals) online system

Automatic Pension Enrolment - Overview

Government concerned that people not saving for their retirement

New requirements - all employers to enrol their workers into a qualifying workplace scheme if they are not already in one

Qualifying scheme

Defined contribution scheme with a minimum contribution; or

Defined benefit or hybrid scheme which meets certain conditions

Automatic Pension Enrolment - Timescales

Commenced October 2012 but phasing in of duties over 6 years

Staging date dictated by number of employees in PAYE scheme

Can be found by inputting PAYE reference at www.thepensionsregulator.gov.uk/employers/tools/staging-date.aspx

Other useful tools on The Pensions Regulator website

Automatic Pension Enrolment – Implications

Minimum total and employer contributions

Increase over time

No maximum

Employer can contribute more than the stated minimum

Automatic Pension Enrolment – Minimum Contributions

TimingMinimum Total Percentage of Salary

Minimum Employer Contribution

October 2012 to September 2017

2% 1%

October 2017 to September 2018

5% 2%

October 2018 onwards

8% 3%

National Minimum Wage

Age Current Rate Rate from 1 October 2013

21 and over £6.19 £6.31

18 to 20 £4.98 £5.03

Under 18 £3.68 £3.72

Apprentice £2.65 £2.68

High Value Dealer Legislation – Anti-Money Laundering Rules

If prepared to take cash payments of 15,000 Euros or more in return for goods must register as High Value Dealer

HMRC now telephoning such businesses

To ensure their records are up to date

To obtain additional information e.g. type of goods sold

To check whether business understands their obligations – follow up visits?

You will be notified in writing before call is made

General Anti-Abuse Rule (GAAR)

The case for and against

Likelihood of success

The future of tax planning