Entries from July 2008 ↓

In order to encourage recycling, the government has recently commenced plans to charge people a £50 tax if they throw away too much rubbish.

However, according to Labour this is a ‘negative incentive’ rather than a tax; “This is not akin to a tax. Its technically a tax but…it does not behave like a tax” said Joan Ruddock, the waste and recycling minister.

Guess that’ll just be another stealth tax then?

A tax loophole used by contractors has been closed down with retrospective effect. The loophole used an offshore trust to save tax. However, these contractors will now be faced with massive tax bills going back several years.

Further details can be found on Shout 99.

You may need to check that someone’s VAT registration is valid for various reasons, e.g. if a customer is EC resident but outside of the UK you should not charge them VAT or if a supplier charges you VAT you may want to make sure it is genuine.

You can check the validity of a VAT number by visiting this website or phoning Direct Gov on 0845 010 9000.

Where work clothes qualify as a uniform or protective clothing, the employee can claim the cost of cleaning the clothes against his tax bill. The taxman has published agreed flat rate for some industries but if you don’t fall into these the standard flat rate is £60 (2008/09).

So, what is a uniform? Obviously, the police, fire service and nurses will qualify here along with several banks and airline staff. Shirts, blouses, socks and shoes do not fall into this category. However, if you fix a permanent company badge to the item of clothing this should make the cleaning of it tax deductible.

Protective clothing is typically overalls, boots and hard hats.

The Government has announced that it intends charging pensioners more tax on their pension income.

Up to April 2009 pensioners receiving private pensions of up to £1,000 pa enjoyed tax free status. However after April 2009, they will have to pay 20% in tax. There is also a threat that they will seek back tax on the two previous years (2007/08 and 2008/09) at 22%.