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[sarkasm] 29/7/2018 08:13

monyinternational.com



What Is The Common Reporting Standard For Expats?
By
Ryan Holder -
July 29, 2018
0
23

The Common Reporting Standard is expected to swing into action in a few weeks – but how does this impact expats and the tax they pay?

To find out, here’s a list of frequently asked questions about the standard:
What is the Common Reporting Standard?

The Common Reporting Standard or CRS is a network of international tax authorities working together to swap personal and financial data about each other’s citizens with bank accounts of investments in their countries.
What is the CRS aiming to accomplish?

The CRS establishes the tax residence of bank customers and investors who have offshore holdings.

Financial institutions, which include banks, building societies, investment funds and trusts, must tell their local tax authority about any foreign customers and their holdings.

The information is passed to the customer’s home tax authority to check against filings to make sure the right of tax has been paid on any interest, dividends or gains.
When does CRS reporting start?

It already has. Early adopters such as the UK and Spain started swapping tax data in September 2017, although the entire network is due to trigger from September 1, 2018.
What is reported under CRS?

Personal details requested by the financial institution expats deal with plus details about accounts and financial products, including the balance of an account or value of investment and the total of any interest or payments credited to them each year.
How many countries are part of the CRS network?

CRS has around 108 member countries with the notable exception of the USA.

The UK, most European countries and the rest of the world’s leading financial centres are all involved. The list includes a host of notable places once considered as tax havens.
Why isn’t the USA involved?

The CRS is based on the US Foreign Account Tax Compliance Act (FATCA).

FATCA already swaps data between the US Internal Revenue Service and foreign tax authorities and will continue to do so outside the CRS.
How does this affect expat tax?

It doesn’t unless an expat has undeclared offshore assets. If they are in a CRS member country, they will be fully disclosed to the expat’s home tax authority for comparison with tax filings.
What do expats have to do under CRS?

Expats do not have to take any action other than fully declaring their offshore assets.

However, any financial institutions expats deal with offshore will ask for personal information, including tax identification numbers.

[chimers] 28/7/2018 23:06

MIDAS SHARE TIPS: Tax is no burden for software firm Tax Systems that helps large firms submit data to the Revenue
By JOANNE HART FOR THE MAIL ON SUNDAY

The UK budget deficit – the difference between how much the Government spends and how much it receives in taxes – is expected to be more than £30billion for this financial year. The figure has been falling, but it is still too high for the Government's liking.

Of course, Chancellor Philip Hammond does not want to increase taxes, but he is keen to collect more of them. One popular way of doing this is by making sure big companies pay the tax they owe.

Tax Systems provides software to help large firms navigate the Government's increasingly complex demands. The shares are at 85½p and should rise as chief executive Gavin Lyons is driven, able and determined to expand the firm.

Lyons ran cyber-security group Accumuli, which was recommended by Midas in 2013 at 12½p and taken over two years later at 33p.

In 2016, he turned his attention to Tax Systems, then owned by a couple in their 70s, who had put the business up for sale. Backed by supportive investors, Lyons bought the firm and listed it on Aim.

The company was already highly attractive, with about a thousand customers, including more than 100 firms in the FTSE 250 index and all but one of the UK's top 20 accountancy groups. But turnover had been static for three years and Lyons was keen to grow.

The environment is conducive. In recent years legislation has been introduced to force companies to produce tax filings that are more detailed than ever before. And in April, the Government's 'Making Tax Digital' policy comes on-stream, requiring firms to file VAT returns online in the first instance.


Tax Systems helps customers collect the relevant data, ensure they comply with regulations and manage the taxation process so they pay the right amounts at the right time in the right way.

Lyons has also introduced new incentives for Tax Systems' sales people and strengthened top management, with the appointment of several directors who have worked successfully with him in the past.

Early results of Lyons' strategy are encouraging. The company said in a trading statement last week, that it expected sales for the first half of 2018 to be 14 per cent ahead of the same period last year and directors were confident about earnings for the full year.

Analysts expect 2018 profits of at least £5.8million, an 18 per cent rise on the year before. There is no dividend, as the firm took on about £30million of debt to pay the former owners for the business. But that has come down to £17.5million and should continue to fall over two to three years, at which point the company may start to pay dividends.

Midas verdict: As anyone paying tax on account this week will testify, the Revenue is increasingly demanding. Tax Systems alleviates the burden and works with some of the UK's biggest firms and accountants, many of whom have been customers for years. Lyons is a seasoned operator with a history of delivering results. At 85½p, the shares are a buy.

[adrian j boris] 09/7/2018 06:58

Monday 9 July 2018 6:00am
Pensioners in the UK shelling out over £24bn in income tax
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Josh Mines
Josh Mines is a reporter for City A.M. covering telecommunications and marketing [..] Show more
Bank Of England Proposes Switch To Polymer Banknotes
Royal London said the amount of pensioners paying income tax had more than doubled since 1995-96 (Source: Getty)

The amount pensioners in the UK pay in income tax has ballooned to over £24bn, figures out today have shown. ​

Insurer Royal London obtained the information through freedom of information (FOI) requests to find out how much people over the state pension age were paying to the tax man in different parts of the UK.

In the latest year which HMRC had detailed figures for, 2015-16, Royal London said pensioners paid £24bn worth of income tax, with £21bn of it being footed by taxpayers in England.

Surrey pensioners shelled out the most, with a total tax bill of £961m, meaning they are paying more income tax than the entire retired population of Wales.

Kensington & Chelsea topped the list for the amount pensioners were paying in tax by local authority, as residents paid an average of £32,250 in 2015-16. That's around 27 times more than the area paying the least tax, Stoke on Trent UA, where pensioners paid just £1,192 on average.

The study also showed that the number of taxpayers over the age of 65 has doubled from 3.32m in 1995-96 to 6.49m in 2015-16 - although it's believed the number has reduced slightly to stand at 6.37m in 2018-19.

Read more: Pensioner households paying out nearly £9bn in income tax per year

Royal London added that more than a quarter of taxpaying pensioners were still in paid work, with 1.5m having an employment income and 500,000 getting an income from self-employment.

Steve Webb, director of policy at Royal London said:

Many people might assume that once you retire you cease to be of interest to the taxman. But these figures show that this is very far from being the truth. The number of taxpaying pensioners has nearly doubled in the last two decades. With talk of also requiring pensioners to pay National Insurance on any earnings or even pensions, the older population may start thinking of themselves as 'Generation still taxed'.

When planning for retirement it is vital to remember that the tax office will still want a slice of your income, which reinforces the need to put aside enough to secure a decent standard of living, even after the tax man has had his slice”.

[adrian j boris] 09/7/2018 06:56

Monday 9 July 2018 6:00am
Pensioners in the UK shelling out over £24bn in income tax
Share


Josh Mines
Josh Mines is a reporter for City A.M. covering telecommunications and marketing [..] Show more
Bank Of England Proposes Switch To Polymer Banknotes
Royal London said the amount of pensioners paying income tax had more than doubled since 1995-96 (Source: Getty)

The amount pensioners in the UK pay in income tax has ballooned to over £24bn, figures out today have shown. ​

Insurer Royal London obtained the information through freedom of information (FOI) requests to find out how much people over the state pension age were paying to the tax man in different parts of the UK.

In the latest year which HMRC had detailed figures for, 2015-16, Royal London said pensioners paid £24bn worth of income tax, with £21bn of it being footed by taxpayers in England.

Surrey pensioners shelled out the most, with a total tax bill of £961m, meaning they are paying more income tax than the entire retired population of Wales.

Kensington & Chelsea topped the list for the amount pensioners were paying in tax by local authority, as residents paid an average of £32,250 in 2015-16. That's around 27 times more than the area paying the least tax, Stoke on Trent UA, where pensioners paid just £1,192 on average.

The study also showed that the number of taxpayers over the age of 65 has doubled from 3.32m in 1995-96 to 6.49m in 2015-16 - although it's believed the number has reduced slightly to stand at 6.37m in 2018-19.

Read more: Pensioner households paying out nearly £9bn in income tax per year

Royal London added that more than a quarter of taxpaying pensioners were still in paid work, with 1.5m having an employment income and 500,000 getting an income from self-employment.

Steve Webb, director of policy at Royal London said:

Many people might assume that once you retire you cease to be of interest to the taxman. But these figures show that this is very far from being the truth. The number of taxpaying pensioners has nearly doubled in the last two decades. With talk of also requiring pensioners to pay National Insurance on any earnings or even pensions, the older population may start thinking of themselves as 'Generation still taxed'.

When planning for retirement it is vital to remember that the tax office will still want a slice of your income, which reinforces the need to put aside enough to secure a decent standard of living, even after the tax man has had his slice”.

[the grumpy old men] 08/5/2018 06:12

TAX PENSIONERS

[sarkasm] 06/5/2018 21:23

Business

British taxpayers accidentally give too much as HMRC discovers unexpected generosity

HMRC
Under-declaring income is normally thought of as a problem for the taxman, but a new HMRC trial found that people more often over-declared their pay, possibly in an act of caution Credit: HMRC

Tim Wallace

6 May 2018 • 8:39pm

Tax dodging is less rife than previously thought as HM Revenue and Customs has unexpectedly discovered that Britons typically err on the side of caution, inadvertently overpaying on their self-assessment forms.

Contrary to the expectation that taxpayers play down their incomes as much as possible – or, as in recent high-profile cases, evade taxes – a trialled new system revealed the opposite to be more commonly true. An automated system that used existing data to pre-write a taxpayer’s income found that it reduced the income declared more often than not.

Jon Thompson, chief executive of HMRC, revealed the discovery in a letter to MPs. This “had a small net negative impact on overall tax receipts due to improved accuracy of self-assessment returns”, Mr Thompson wrote. He added: “Decreases in overpayments outweighed the reductions in small ­underpayments.”

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The trial pre-populated incomes for more than 685,000 “customersR21;, as HMRC refers to taxpayers, between August 2016 and March 2017, for the 2015-16 tax year.

Most kept the pre-typed income number, though 17pc wrote in their own figure and 15pc over-wrote the employment benefit figure.

Tax accountant George Bull at RSM says this is bad news for any plans to use this new system to identify underpayment and close the “tax gap”, the hole in revenues that HMRC believes it is owed.

“The revelation that most self-assessment taxpayers seem to overstate rather than understate their tax liabilities is a nail in the coffin of HMRC’s plan to use Making Tax Digital for individuals to reduce the tax gap,” he said, adding that it could cast doubt on the overall tax gap estimate.

“The working assumption within HMRC was that reducing error would increase the tax take because most errors would be in the taxpayer’s favour rather than HMRC’s. Good compliance is an end in itself and doesn’t need to be justified as a potentially spurious means of closing the tax gap.”

An HMRC spokesman said most of the tax gap came from businesses, not individuals.

[ariane] 05/3/2018 12:23

Calls to abolish tax bands and create single tax schedule

Tax bands should be abolished and income tax and employee National Insurance contributions (NICs) combined into a single tax ‘schedule̵7;, with all sources of income taxed at the same rate, and on the same basis in order to create a more efficient and progressive tax system, according to the Institute for Public Policy Research (IPPR)

5 Mar 2018
Pat Sweet
Pat Sweet

Reporter, CCH Daily and Accountancy, published by Croner-i Ltd
View profile and articles.

The think-tank says its approach, which would replace the existing system of marginal tax bands with by a ‘formula-based’ system such that every taxpayer’s marginal rate would depend on their own precise level of income, would raise revenues in a way that is fairer and more politically acceptable.

This approach effectively abolishes tax bands for everyone except those on the highest incomes. Everyone earning above a new tax-free allowance and below £100,000 would have their own personal marginal tax rate, which would rise gradually the higher their income, up to a top rate of 50%. As a result, everyone earning less than £44,400 could see their average tax rate fall.

The IPPR said that the system would enable policymakers to raise much more revenue to fund public services, raising between £6bn and £16bn more a year, while still increasing post-tax incomes for at least 75% of individual taxpayers.

The think-tank argues that as things stand, the variable treatment of different sources of income reduces the current system’s progressivity, creates perverse economic incentives and helps to create political opposition to tax rises.

For example, the effective rate of tax on annual earnings from employment above the tax-free allowance is 32%, compared to 7.5% for income paid in dividends from company profits. The marginal rate of income tax also jumps from 40% to 60% and back to 40% as the personal allowance is withdrawn for incomes over £100,000.

For income tax payers on the lowest earnings, effective marginal tax rates can be as high as 75% as means tested benefits are withdrawn as a result of higher pay. The institute says this variable treatment of different sources of incomes, combined with sharp ‘cliffs’ in the marginal rate between tax bands, creates perverse economic incentives, makes tax avoidance more likely and is far from transparent.

Alfie Stirling, IPPR senior economic analyst and author of its report, said: ‘The UK’s system of taxing incomes is not progressive enough, too inefficient and poorly equipped to raise the revenue that almost certainly will be needed to meet the public spending challenges of the 21st century.’

Tapering Over the Tax Reforming taxation of income in the UK is here.

Report by Pat Sweet

[maywillow] 03/3/2018 08:12

Council tax
Money talks
Council tax should be fair and progressive. Ours is neither
Patrick Collinson
Patrick Collinson
It is outrageous that a person in a £17m Westminster mansion pays less than a pensioner in a Nottingham bungalow

Sat 3 Mar 2018 07.00 GMT

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Residents of Westminster, one of London’s most upmarket districts, will pay a maximum of £1,376 in council tax this year.
Residents of Westminster, one of London’s most upmarket districts, will pay a maximum of £1,376 in council tax this year. Photograph: Bloomberg via Getty Images

There is a Grade II-listed seven-bedroom home of “ambassadorial proportions” for sale in Westminster, just along from the old Conservative party headquarters, if you’ve got the odd £17m to spare. But there is one financial worry the buyer won’t have: council tax. The new owner will be presented with a council tax bill for 2017-18 of just £1,376. We know this because that is the maximum council tax bill anyone in Westminster paysfor a top-tier, band H property.

Meanwhile, a pensioner in Nottingham living in a small bungalow worth about £150,000 is likely to be in the council’s C band and facing a tax bill of £1,645. Why are millionaires in London paying hundreds of pounds less in annual property taxes than someone struggling on a small pension in Nottingham?

The iniquities of council tax worsen every year. The annual survey of local authorities by accountancy body Cipfa this week revealed that households in England will see the highest council tax increases for 14 years. The average rise will be 5.1%, or double the rate of pay and pension increases – and that comes on top of a rise of 4% last year. The average band D equivalent in the north-east is now £1,799; in inner London it is £1,194.

A friend lives in a four-bed house in north London, worth nearly £1m, yet it was put in band B two decades ago, and she’s in no hurry to update the council or her £1,000-a-year bill. A woman I know lives alone, yet her council, almost randomly, prohibits anyone applying for the 25% single person discount that is available at most other councils.
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Tax bands that made some sort of sense when they were last evaluated in 1992 – a quarter of a century ago – are absurd today. Westminster has the same A to H system as everywhere else. Its A band is for properties valued at up to £40,000 in the borough, while its very highest level, H, is for properties valued at more than £320,000. A search on Rightmove reveals a solitary one-bed flat for sale in Westminster for less than £320,000.

Since the poll tax eventually spelled the end for Margaret Thatcher, politicians have imposed an exclusion zone around council tax reform. Yet the need for reform grows ever more urgent. It should start with an acknowledgement that property taxes can be progressive and efficient. Generally, we under-tax wealth in the UK, which means we place excessive burdens instead on working people’s income and spending, while the rentiers who have prospered from property wealth gains have been left relatively untouched. Taxing property is also relatively simple, as houses can’t be hidden. The Joseph Rowntree Foundation, Labour’s Progress group and many others have outlined sensible proposals for reform, while Scotland has already started down the path of change. Can we please follow them?

[sarkasm] 01/3/2018 11:56

THINGS TO COME

[sarkasm] 01/3/2018 11:53

Council tax set for biggest increase in 14 years, CIPFA survey finds
By:
Emily Twinch
1 Mar 18

Just over 95% of councils across England will raise council tax next year and bills are set for the biggest increases in 14 year, according to CIPFA’s annual survey released today.

Of the 276 councils that responded, 263 will increase their council tax, taking advantage of the ability to raise it by up to a further 1%, allowed by the local government finance settlement for the next financial year.

Excluding the 3% precept for adult social care, 71% of English authorities would increase council by the maximum 2.99% allowable before reaching the local referendum threshold, CIPFA found.

Authorities with adult social care responsibilities can raise an additional 3% without the need for a referendum via the adult social care precept.

CIPFA calculated households across England were to see an average council tax increase of £81.05 (5.1%) – the steepest hike in 14 years.

It also identified the gap between rates across the country. The average band D bill in the North East is now £1,799, whereas in inner London it is £1,194.

Rob Whiteman, CIPFA chief executive, added: “This sharp rise in council tax across the country reflects the enormous financial pressures many local authorities are currently under.

“Local government has made by far the biggest efficiencies in the public sector since 2010, but now it feels like crunch time, with the consequences of earlier funding cuts really beginning to bite.”

He called Northamptonshire County Council’s need to issue a section 114 notice last month - meaning it had used its reserves and was unable to produce a balanced budget – a “test case for what the minimum services can be that a council is required to deliver”.

Northamptonshire has since revised its budget to find a further £9.9m of savings.

Whiteman said children’s and adult social care were the main focus of resources for many town and county halls, and they were coping with increased demands against a backdrop of government grants being phased out, often using reserves.

“It is clearly time for an honest conversation about what services councils should realistically be expected to deliver,” he said.

In addition, almost 90% of police and crime commissioners in England (31 out of 36 PCCs responded) have also gone for increases of between £11.97 and the maximum allowable increase of £12, CIPFA revealed.

“This comes at a time of increasing pressure on police funding and follows the report late last year on efficiency from Her Majesty’s Inspectorate of Constabulary and Fire and Rescue Services which, while highlighting the financial challenges for some forces, stated that further efficiencies could be made,” the institute stated.

Home secretary Amber Rudd announced in December last year the police would be able to increase their precepts up to £12 as part of the police settlement for 2018-19.

Emily Twinch

Deputy editor

[sarkasm] 01/3/2018 11:51

Council tax set for biggest increase in 14 years, CIPFA survey finds
By:
Emily Twinch
1 Mar 18

Just over 95% of councils across England will raise council tax next year and bills are set for the biggest increases in 14 year, according to CIPFA’s annual survey released today.

Of the 276 councils that responded, 263 will increase their council tax, taking advantage of the ability to raise it by up to a further 1%, allowed by the local government finance settlement for the next financial year.

Excluding the 3% precept for adult social care, 71% of English authorities would increase council by the maximum 2.99% allowable before reaching the local referendum threshold, CIPFA found.

Authorities with adult social care responsibilities can raise an additional 3% without the need for a referendum via the adult social care precept.

CIPFA calculated households across England were to see an average council tax increase of £81.05 (5.1%) – the steepest hike in 14 years.

It also identified the gap between rates across the country. The average band D bill in the North East is now £1,799, whereas in inner London it is £1,194.

Rob Whiteman, CIPFA chief executive, added: “This sharp rise in council tax across the country reflects the enormous financial pressures many local authorities are currently under.

“Local government has made by far the biggest efficiencies in the public sector since 2010, but now it feels like crunch time, with the consequences of earlier funding cuts really beginning to bite.”

He called Northamptonshire County Council’s need to issue a section 114 notice last month - meaning it had used its reserves and was unable to produce a balanced budget – a “test case for what the minimum services can be that a council is required to deliver”.

Northamptonshire has since revised its budget to find a further £9.9m of savings.

Whiteman said children’s and adult social care were the main focus of resources for many town and county halls, and they were coping with increased demands against a backdrop of government grants being phased out, often using reserves.

“It is clearly time for an honest conversation about what services councils should realistically be expected to deliver,” he said.

In addition, almost 90% of police and crime commissioners in England (31 out of 36 PCCs responded) have also gone for increases of between £11.97 and the maximum allowable increase of £12, CIPFA revealed.

“This comes at a time of increasing pressure on police funding and follows the report late last year on efficiency from Her Majesty’s Inspectorate of Constabulary and Fire and Rescue Services which, while highlighting the financial challenges for some forces, stated that further efficiencies could be made,” the institute stated.

Home secretary Amber Rudd announced in December last year the police would be able to increase their precepts up to £12 as part of the police settlement for 2018-19.

Emily Twinch

Deputy editor

[waldron] 28/2/2018 17:02

Inheritance tax and ISAs: Unsuspecting Brits could face surprise bill

By Kate Saines in Investments February 28, 2018 0

Few people are aware that ISAs are subject to inheritance tax (IHT), a survey by Octopus Investments has discovered.

Research by the fund management company found that only 25% of those questioned knew the investments could form part of a person’s taxable estate and were therefore liable for IHT.

This lack of understanding is leading to concerns many families could face an unexpected tax bill because they do not know the rules.

It is not just the young who are unaware of the IHT implications of ISAs. The survey revealed just over a quarter (28%) of those aged 55 and over knew that ISAs were not exempt from the tax compared to 18% of 18 to 34 year olds.

Over half of respondents (54%) said they didn’t know whether ISAs were exempt from IHT and a fifth (21%) incorrectly thought they were.

Octopus said the results meant many Brits could be sleepwalking into an inheritance tax nightmare.

Paul Latham, managing director for Octopus Investments, said: “This is not just a problem for the super-wealthy. Despite efforts to increase the current threshold, we still expect to see a rise in the number of estates subject to inheritance tax, particularly in London where the average property price currently stands at £484,000.

“There are a number of options now available to those who currently have a stocks and shares ISA and who wish to pass on as much of it as possible to their children.

“One of those options includes investing in AIM-listed shares.”

He added: “By transferring a stocks and shares ISA to an ISA wrapper which holds a portfolio of AIM companies, investors can reduce their tax liabilities without locking away their money for the long term and continuing to benefit from the benefits of the ISA wrapper.”

[sarkasm] 19/2/2018 21:48

Cheers pug