ISSUE 21 - April to July 2003
1.
A
QUICK OVERVIEW OF THE MAJOR POINTS IN THIS YEARS BUDGET…
Thankfully
for UK tax payers there were no major surprises announced by Gordon Brown in
this year’s Budget.
As announced last year, income tax rates and main allowances are frozen, and NIC rates have been increased by 1% for employees, employers and self-employed.
The budget sees the introduction of Working Tax Credit and Child Tax Credit from 6th April 2003, and new Pension Credit from October.
There
have been no significant changes to either inheritance tax or to pension
schemes.
In
their bid to become more family and child friendly, a welcome new introduction
by the Government is the Child Trust Fund - where the Government will give £250
to every child at birth, to spend at the age of 18.
There have been small increases in 10% and 22% income tax bands. Consult the tax tables in your budget summaries for details.
2.
YOUR
EMPLOYEES, EMAILS AND THE INTERNET
The
Problem...
Many
businesses now send and receive correspondence and other documentation by e-mail
and have access to the internet. Indeed, the majority of such businesses will
have computer terminals for many of their employees. Such access to this method
of electronic data transmission can cause potential problems through its
possible abuse by employees.
The problems that can follow the misuse of e-mail and the internet are many, including the loss of productivity, disclosure of sensitive business information, the potential inflow of viruses, the receipt of “spam”, i.e. unsolicited e-mails received from internet sites visited by employees, and the sending and receiving of indecent or defamatory e-mails.
The
Solution...
The
solution to the misuse of e-mails and/or the internet lies in either preventing
access to these systems or limiting their misuse if access is necessary during
the employee’s normal course of work.
This
seems like a simple solution, but this is not necessarily so. Legally an
employer can stipulate that an employee must not use personal e-mails or use the
internet for personal purposes but the detection of such misuse is often
difficult, especially in larger businesses. Alternatively, passwords can be used
to prevent access although these will usually prevent total access, which will
mean that an employee cannot obtain access to carry out his or her daily work.
The
above solutions are regarded by some as being
somewhat draconian
and indeed, when
Monitoring
The Use Of The System...
This is a difficult area and one which employers must be careful in implementing. The key area concerns the difference between monitoring and interception. An employer is allowed to monitor the system by, for example, looking through and reading a list of sent or received e-mails. However, this is very different from interception, which involves intercepting an e-mail during the course of its transmission as opposed to reading a stored version of the e-mail. Interception, in most cases, is prohibited by law, although there are exceptions to this rule.
Our
Advice:
Make
sure that all employees are aware of your business’s policy regarding the use
of e-mails and the internet.
Consider
having this policy in writing either within an employee’s contract of
employment or for the employee to sign a policy statement as evidence that they
are aware of, and accept it.
Employees should be made aware that e-mail is as legally binding as any other form of document and that laws relating to defamation and racial and sex discrimination apply to e-mails too.
Perhaps
set up personal e-mail addresses for each employee so that the businesses main
e-mail addresses is not deluged by spam e-mails.
3. FEE PROTECTION AGAINST INLAND REVENUE INVESTIGATIONS
The
1st June will soon be upon us and we would like to remind our clients
to return the application forms for the renewal of the fee protection insurance
to us as soon as possible. Any full investigation into your returns and / or
accounts can prove to be a costly exercise, both in time and money, even if
everything is found to be in order.
By taking out this relatively low cost insurance you are ensuring that you will not have to pay out any additional fees to us for the work carried out on your behalf during the investigation.
The
areas covered are as follows;
Income Tax Self Assessment Full Enquiries
Corporation
Tax Self Assessment Full Enquiries
PAYE,
NIC and benefit investigations
VAT
Disputes
IR35
Disputes
The
costs involved for businesses are £100 per annum (including insurance premium
tax), and £25 per annum for private individuals.
For
full details of cover, please contact us.
If
you are eligible for the new Child Tax Credit or Working Tax Credit, it is your
responsibility to make sure that you apply for it.
You do not automatically receive it even if
you
previously received a tax credit under the old system.
If you are not sure if you qualify for either of these, please contact
us, because as the adverts say if you are entitled to it then “it’s money
with your name on”.
There
have been several reports claiming that the Inland Revenue’s tax credits help
line has been incredibly hard to get through to, but the credits can only be
back dated for up to 3 months, so if you put off contacting them, you may well
miss out, so please do either ask us or continue trying.
For more information visit www.taxcredits.inlandrevenue.gov.uk
