The new penalties will impact businesses who submit their VAT returns or pay their VAT late. The first monthly returns and payments affected by the penalties are due by 7 March 2023.
The late payment penalties and points-based late submission penalties were introduced from 1 January 2023, replacing the VAT default surcharge, and apply to accounting periods which start on or after that date.
The penalties for late VAT returns also apply to businesses that submit nil returns and repayment returns. Changes have also been made to how interest is calculated.
The changes to VAT penalties and interest payments are:
Late submission penalties
These work on a points-based system. For each VAT return submitted late, HMRC customers will receive a penalty point until they reach the penalty point threshold – at which stage they will receive a £200 penalty. A further £200 penalty will also apply for each subsequent late submission while at the threshold, which varies to take account of monthly, quarterly and annual accounting periods.
Late payment penalties
If a VAT payment is more than 15 days overdue, businesses will pay a first late payment penalty. If the VAT payment is more than 30 days overdue, the first late payment penalty increases and a second late payment penalty will also apply. To help customers get used to the changes, HMRC will not charge a first late payment penalty on VAT payments due on or before 31 December 2023, if businesses either pay in full or a payment plan is agreed within 30 days of the payment due date.
HMRC will help businesses that cannot pay their VAT bill in full. HMRC customers may be able to set up a payment plan to pay their bill in instalments. After 31 December 2023, if a HMRC customer proposes a payment plan within 15 days of payment being due and HMRC agrees it, they would not be charged a late payment penalty, provided that they keep to the conditions of the payment plan. Late payment penalties can apply where proposals are made after the first 15 days, but the agreement of the payment plan can prevent them from increasing.
HMRC has introduced both late payment and repayment interest, which will replace previous VAT interest rules. This brings the new regime in line with other taxes.
Getting ready for the 2025 PSTN switch-off
From 2025, ISDN (integrated services digital network) and PSTN (public switched telephone network) telephone lines will be permanently turned off. This applies to business and home customers.
You need to start planning your move today because there could be a lot to do.
Remember, it’s not just about your phone services, you need to review everything you’re connecting to your phone lines, like alarms, EPOS machines, door entry systems, CCTV, and faxes.
Many businesses have already embraced an all-digital model, moving their communications to the cloud, making calls over the internet and embracing video conferencing.
Genuine HMRC contact and recognising phishing emails
Find out about methods fraudsters use to try and get your personal information by viewing examples of scams identified by HMRC.
HMRC will sometimes contact customers by telephone, email, letter, and also sometimes use research companies to contact customers. If you’re not sure the contact is genuine then take a look the updated guidance on examples of HMRC related phishing emails, suspicious phone calls, and texts.
The Sustainability Accelerator is open to start-ups who are creating more sustainable consumer products and, for the first time, those developing technology that can help the industry recycle products more effectively and efficiently.
The programme is now accepting applications from early-stage start-ups in Europe.
The closing date for applications is 17 March 2023.
£1 million fund for fresh ideas to improve health at work
The UK Government is launching a competition for businesses to bid for a share of £1 million to stimulate innovation in Occupational Health (OH).
Successful bidders will receive up to £100,000 to back their projects from 19 May 2023, with the UK Government looking for innovative solutions to drive better access for SMEs and the self-employed to OH services. Applicants are being encouraged to demonstrate how they would deliver improvements to OH, harnessing technology such as artificial intelligence or data collection, to deliver better health outcomes for employees of SMEs.
Better health provision for staff helps employers look after their workforce, meaning more are likely to stay in work. While larger employers often have better access to OH services, for smaller businesses and the self-employed the lack of support for people with health needs can potentially lead to more people becoming economically inactive.
Applications can be from those who work alone or with others from business, research organisations, research and technology organisations or the third sector.
The competition closes on 15 March 2023.
Know where your old stamps are?
Royal Mail have added barcodes to their regular stamps. Regular stamps without a barcode will no longer be valid after 31 July 2023. This follows the introduction of a 6 month grace period from the initial 31 January deadline. You can either use up your non-barcoded stamps before this new deadline or swap them for the new barcoded ones.
The stamps that have changed are the stamps that will be very familiar to you. They feature the profile of Her Late Majesty The Queen on a plain coloured background.
File Companies House accounts early to avoid penalties
If you are due to file accounts with Companies House, use the online services where possible and allow plenty of time before your deadline.
File online before your deadline. Companies House will send you an email to confirm that they have received your accounts. They will send you another email when they have registered your accounts.
If you’re a small company, you cannot file abbreviated accounts anymore. Find out your accounts filing options for small companies. You’ll still need to file accounts if your company is dormant.
Companies House online services are available 24 hours a day, 7 days a week – and there are inbuilt checks to help you avoid mistakes.
To file online, you will need your company authentication code. If you need to request a new code, you should allow up to 5 days for this to arrive at the company’s registered office.
Companies House advise that you should only send paper accounts if your company cannot file online. Accounts filed on paper need to be manually checked. Companies House can only check them during office opening hours, and they can take over a week to process.
If you need to file your accounts on paper, you should send them to Companies House well before the deadline. This will give you plenty of time to correct your accounts and resend them if they are rejected. You should also consider using a guaranteed next day delivery and note any factors which may make it difficult for a carrier to deliver on time. Companies House cannot accept postal delays as a reason to appeal a late filing penalty.
Gender pay gap reporting: guidance for employers
The gender pay gap is the difference between the average (mean or median) earnings of men and women across a workforce.
From 2017, if you are an employer who has a headcount of 250 or more on your ‘snapshot date’ you must comply with regulations on gender pay gap reporting. Gender pay gap calculations are based on employer payroll data drawn from a specific date each year. This specific date is called the ‘snapshot date’.
There are two deadlines which each have their own snapshot dates:
- Most public authority employers must use a snapshot date of 31 March. They must report and publish their gender pay gap information by 30 March of the following year.
- Private, voluntary, and all other public authority employers must use a snapshot date of 5 April. They must report and publish their gender pay gap information by 4 April of the following year. These employers must also include a written statement.
New national hub for fintech
A national hub for fintech excellence was formally launched last week, seeking to boost the sector’s growth and helping it to achieve truly global scale. The Centre for Finance, Innovation and Technology (CFIT) will champion the UK’s world-leading sector.
The CFIT seeks to build on the dominance of the UK’s fintech sector, which supports around 2,500 firms, tens of thousands of jobs in the UK, and is second globally only to the US for fintech investment, ahead of China and India.
It will provide a much-needed boost to people and businesses up and down the country, enabling them to benefit from new waves of technological change and innovation – widening consumer choice, cutting costs, and increasing efficiency for firms.
HSE guidance and information available to download
The Health and Safety Executive (HSE) offers a wide variety of publications containing advice and guidance for employers, workers and the general public.
Like all HSE publications, the health and safety guidance leaflets are available to download on HSE’s website. See: HSE Publications – free leaflets to download