I suppose it is too early to comment on Ed Miliband.

The new leader of the British Labour party, Ed Miliband, says he is not going to squeeze the country's middle class but who is going to believe him? The current coalition government seems to have a few tax-raising initiatives of its own. There is the possibility that HMRC wants to take central control of payrolls so as to deduct
income tax and national insurance and then send the remaining amount to your bank account. Is this Stalinism or Conservatism? I don't know if Tory voters knew this would be in the pipeline when they voted for David Cameron. Apparently, the HMRC wants to cut down PAYE errors with people who get multiple payments from different jobs and various pension payments. I think HMRC would need a few more staff and a bigger computer to cope.
To be fair Allister Heath puts it far better than me:
http://www.cityam.com/news-and-analysis/allister-heath/don%E2%80%99t-reward-hmrc%E2%80%99s-massive-failure

I assume non-doms will just leave UK.

I assume non-doms will just leave the United Kingdom rather than messing about with
the HMRC and it means that British Prime Minister Gordon Brown has managed to kill the Golden Goose, which lays the golden eggs. The City of London is already going through a downturn with UBS employees the latest to feel a bit quesy.
One problem making a move against Non-Doms is that they are so mobile. Switzerland looks good, a bit cleaner, a bit less crime. If you are a U.S citizen and already get taxed worldwide by Uncle Sam, you could always bite your lip and go back.

St Albans firm Gilberts publishes Spring newsletter.

The St Albans accountancy firm Gilberts has published its Spring newsletter, which
which highlights various United Kingdom tax changes. For instance, with capital gains tax, the government is ending taper relief, which was originally brought in
by Gordon Brown. Gilberts can advise on strategies for capital gains tax (CGT).
The Labour administration wants to raise more tax from small companies. As previously announced corporation tax is to be raised by 1 percentage point to
21 pct from April 2008 on profits of up to £300,000. In addition, the government is to crack down on income shifting. This follows the Arctic Systems tax case, which HMRC lost but has not stopped it from fighting back.
Gilberts just discusses the changes neutrally. I have added words such as Gordon Brown, Labour and HMRC.

I am not looking forward to Darling's first budget.

I am not looking forward to Alistair Darling's first budget on Wednesday. I hope my
small car is not viewed as a gas guzzler and avoid attracting increased duty.
Apparently, the UK Chancellor needs more of our money and especially that of foreigners. This has stirred a real hornets nest. The City of London is basically
like Wimbledon. We hold the tournament but foreigners go and win it. Our domestic
institutions such as Kleinworts, Smiths and Warburgs sold out long ago.
I read today Anatole Kaletsky's column in the Times, which said that Gordon Brown decided to support the HMRC, which has long wanted to adjust the tax regime for
non-doms. This contrasts with the Treasury, which wanted to leave well alone.
Kaletsky is predicting some kind of climbdown on Wednesday.

How to account for the virtual economy of Second Life!

The September 2007 edition of accounting & business takes a look at the accounting treatment of Second Life (SL) and the use of its Linden dollars L$, which can be exchanged for hard currency. The article notes the success of Chinese-born Ailin Graef, who is a German resident and who has built up a 60 strong, multi-million dollar business from SL.

The U.S Congress is expected to issue a final report on virtual commerce in early 2008. While the British tax authorities Her Majesty Revenue & Customs (HMRC) says that SL players are free to make profits up to the CGT exemption limit of £9,200 after which they should pay tax.

The top players in Second Life are Americans, Germans, French and Britons. Accountng & busines notes that in the United States it is reported that the Maryland-based firm
Katz, Abosch, Windesheim, Gershman & Freedman has started to offer accounting services to Second Life avatars. KAWG&F is one of the top CPA firms in Maryland and is merging with Siebert Kullman.

To tax plan or not to tax plan that is the question!!

You probably need an accountant if you want to venture in the murky world of tax planning in the United Kingdom today. The recent inheritance tax changes accounced by British Chancellor Alistair Darling in his pre-budget report seem to complicate matters more although they do double the inheritance tax threshold to £600,000 from the previous level of £300,000 according to the November 8th edition of Internationalmoneymarketing.co.uk.

To quote "Given the massive rise in the housing market in recent years that means hundreds of thousands of people will be affected and should review the existing terms of their wills with a tax specialist."

The edition says people should seek professional advice but existing solutions such as discounted gift schemes and loan trusts can be still considered.

Tax investigation ?

Reading based accountants Tax-Sorted Ltd highlights the problems of a tax investigation by HMRC.Shaun McGuiness puts into plain speaking and easy to read format for any small to medium business that are uncertain or concerned about this issue.

You would not adam n' eve it!!! HMRC.

Well, I have to admit that I am one of the affected by the security breach
at Her Majesty's Revenue & Customs (HMRC)
and I am not happy. Obviously, bashing together the Inland Revenue and the
Customs by then Chancellor Gordon Brown was a bit of a gamble, since it
brought together two organisations with a different ethos. Commentators
warned that the Revenue would become less user-friendly.

UK Chancellor Alistair Darling looked in a terrible state. The Northern Rock
mess is getting messier and Darling is the one, who has to sort it out.
Suddenly, the British taxpayer is on the hook for nearly a thousand pounds
each.

You will never beat Des Walker!!

This is what the Notts Forest fans used to sing when Des Walker was playing
for the club in its glory days. You could say the same applies to the
taxman or Her Majesty Revenue and Customs (HMRC). The Sunday Times reports that the Revenue is continuing its squeeze on
offshore accounts. What is so amazing is the tax recovered and a total of
£500m is expected to come in by the deadline of 26/11/07.

The Sunday Times notes that some 36,000 people will be formally investigated.
I bet they will need an accountant!!

Roger Wood and Co latest newsletter!!

I have received the September newsletter of the English accountancy firm
Roger Wood and Co. It says if you receive a dividend from running a small limited
company, you need to have the right paperwork in place otherwise the HMRC could decide it is part of your pay and charge national insurance on it.
The HM Revenue and Customs might view the dividend payment as a loan payment
and charge 25 pct tax on it. The accountants firm Roger Wood, which is based in
Dorchester,Dorset, says you need the appropriate minutes approving the
dividend payment. In addition, there should be a tax voucher proving the amount
of the dividend and that tax is deducted at source.

This view is not in the September newsletter of Roger Wood but I believe
the Gordon Brown government uses small companies as instruments of its
social policies. The role of small companies does not seem to be to
generate employment but to pay as much as tax as possible. The HMRC is
very attentive on dividend payments.

Changing the subject, in Dorchester, there is a very nice museum with a
diverse collection. I would really recommend a visit. The Dorset County Museum
is trying to raise a quarter of million pounds to save three paintings for
Dorset by George Romney.

HMRC crack down on Second Life.

The United Kingdom's HM Revenue and Customs is getting tough on
money made from virtual trading on
Second Life. Apparently, it is
benefitting from a super computer.
Patrick O'Brien, a spokesman for HMRC said individuals were free to make profits from trading through games such as Second Life, but would have to pay tax on gains which were greater than their annual capital gains allowance of £9,200.

Accountancy Institute criticises HMRC.

The accountancy body Institute of Chartered Accountants in England and Wales (ICAEW) has criticised UK state revenues collection agency HMRC over the delays in VAT registrations.
These are running at around three months and new companies find it difficult to trade without
one. The ICAEW wants the HMRC to pay compensation and I suppose pigs will fly before that
happens. I get the impression that HMRC just wants to rake the money in.
The VAT delays are due to more checks against fraud. HMRC says these are essential
but promises there will be a plan to improve the situation.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/08/13/cnvat113.xml
The missing trader fraud (carousel) even distorted UK trade statistics with mobile phones. for instance being bought VAT free in Europe and then eventually being sold back to
the continent. Apparently, it was costing the Treasury £5bn a year. Nice one Gordon Brown!!
http://politics.guardian.co.uk/eu/story/0,,2049661,00.html

Tax errors by the HMRC

In the UK, the National Audit Office has found that £157m was overpaid to the HMRC in tax
for the 2006/07 tax year. Apparently, pensioners are more likely to be affected by tax
mistakes. The HMRC also wants the power to dip into bank and building society accounts
to get unpaid tax rather than go through the bother of a legal process.
The tax system has become too complicated and this leads to the mistakes and to the lack of
trust on both sides. Apparently, the ancient Egyptians had a sophisticated tax revenue
system linked to the performance of the Nile. I am not suggesting that the UK one should
be linked to rivers, which would be in poor taste given the flood damage in England, but
there should be an easier way of paying tax. If you have trouble, go and see an accountant!!