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Newsletter

ISSUE 4 OCTOBER 2009

Introduction

Welcome to this Howat Associates fourth newsletter.

There are important updates for you if you are a company director. If you know of a colleague or contact who you think might find the newsletter to be of value please e mail us their details and we will make sure they receive it.  Your comments are welcome and appreciated. This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Housing Market

We believe there are positive signs of a small but steady upturn in the housing market. Our letting business has remained busy throughout the recession- now the sales side is picking up. If you want to sell or buy – get in touch. We can source mortgages for you through our contacts.

Personal Financial review 

Any significant changes should always prompt you to reconsider your investments; the credit crunch and market volatility of recent months illustrate just how quickly our economic environment can change. Your personal circumstances can change quickly too. Such changes can mean you change your attitude to risks or need to reconsider the use of certain asset classes.

We would be delighted to arrange a review of your finances at your home or in our office. Some of our clients have already completed their review and found it to be rewarding and re-assuring. Contact Andrew Smith on This e-mail address is being protected from spambots. You need JavaScript enabled to view it for further information.

Legislative changes for business 2009

Companies Act 2006

Director's address protected from disclosure 

Every director must have a service address and a residential address. The service address for each directorship will be publicly available and the residential address will only be made available to public authorities and credit reference agencies.

On 1 October 2009, a director's current residential address will automatically become the service address. If you would like to use a different service address (e.g. the company's registered office), you will be able to change these details from 1 October on the Companies House website.

Place for keeping company records

There will be changes to the arrangements for inspecting your company's records. Records may be held at the registered office address or at a single alternative inspection location (SAIL).

This site will have to be in the same part of the UK as your registered office. You must notify Companies House to set up a SAIL address or if the SAIL address is moved.

You may only have one SAIL address for a company at a time. Once the SAIL address is set up, you can move some or all registers to the SAIL address by notifying Companies House. Forms for this will be available from their website from 1 October.

Inspection of company records

If a person wishes to inspect your private company's records, they will have to give advance notice of the date and time they wish to carry out the inspection. You will not be able to prevent the person from copying all or part of a record they are entitled to inspect.

You will also have to provide copies of records in the format that a person requests. So, for example, if a person requests a hard copy, you must provide one even if the record is held electronically.

Notification of particulars of share capital 

In an application for a new company, the particular of share capital will be included in a new 'statement of capital', rather than being included in the memorandum.

Any changes in capital will be notified to Companies House through a new statement of capital.

Overseas companies with a business in the UK

There will be a single regime for the registration by overseas companies of the particulars of their UK establishments. There will also be a new regime for the registration of charges over property in the UK created by such companies.

Record-keeping requirements for limited liability partnerships (LLPs)

New record-keeping requirements will be introduced for LLPs. For example, an LLP will have to keep a register of its members that contains prescribed information.

The LLP must also tell Companies House where the register is kept available for inspection.

Forms 

All Companies House forms will change from 1 October 2009. The new forms include:

·                                          Companies Act 2006 information requirements

·                                          new numbers updated to be relevant to the 2006 Act

·                                          additional guidance notes

·                                          details of any fee (if applicable)

The new forms must be used for all company events that take place on or after 1 October 2009. If you use an old form it will be rejected.

Company events which take place before 1 October must be submitted on 1985 Act forms.

Northern Ireland companies 

The Companies Act 2006 will create a single company law regime applying to the whole of the UK, and this order allows for a single UK-wide Register of Companies.

The Companies Registry in Northern Ireland, currently part of the Department of Enterprise, Trade and Investment in Northern Ireland, will become the responsibility of the Secretary of State for Business Innovation & Skills with effect from 1 October 2009.

Employing People 

National Minimum Wage (NMW)

The NMW for eligible workers will increase to £5.80 an hour for workers aged 22 and above and to £4.83 an hour to workers aged 18-21.

The rate for those under the age of 18 but above compulsory school age will go up to £3.57 an hour.

Cost of redundancy

The limit on a week's pay for calculating statutory redundancy payments, and tribunal awards that use a week's pay as the basis for calculation, will increase from £350 to £380.

Tips, service charges  and the NMW 

Bars, restaurants and hotels will no longer be able to count service charges, tips, gratuities and cover charges paid to a worker through the employer's payroll as part of the NMW.

Construction

Housebuilders will have to comply with changes to the Building Regulations 2000. These will introduce for new homes:

·                                          a minimum water efficiency requirement

·                                          a maximum temperature requirement for bath water

The rules will also be strengthened and clarified on:

·                                          the safety of hot water systems

·                                          the supply of water of suitable quality for personal and food hygiene.

Business Payment Support Services 

According to government figures, as at the end of April 2009, over 116,000 businesses have agreed time to pay tax arrangements with HMRC to the value of two billion pounds.

The Business Payment Support Service, which was introduced last autumn, provides a ‘fast track’ service that offers support to those needing more time to pay their tax bills. Terms can be quickly agreed over the phone.

If you would like to discuss the Support Service in relation to your own or your business tax affairs, please do get in touch.

Internet link: Employer Bulletin article

Starting a new business 

HMRC have amended the form CWF1 which is completed by those individuals who have set up a new business either as a sole trader or as a partner in a partnership. The form is used to notify liability to Class 2 National Insurance Contributions (currently £2.40 a week) amongst other things. 

Under the revised behaviour based penalties, which apply from April 2009 anyone becoming or ceasing to be liable to pay Class 2 NICs must notify HMRC as soon as possible. Penalties may be charged where the liability is not notified by 31 January following the end of the tax year when they became liable.

Please do get in touch if you would like any clarification of your position.

Internet link: Form CWF1

HSE warning not to be misled over new law poster 

The Health and Safety Executive (HSE) is warning businesses not to be misled into buying unnecessary and expensive copies of the health and safety law poster. Employers have a duty to display the poster prominently in the workplace or provide employees with a copy of the pocket card version. Both poster and card set out the employer’s and employees’ responsibilities.

Apparently there is some evidence of misleading promotions wrongly claiming that the old posters must be replaced immediately and that the new law poster should be displayed on every notice board within business premises. This is incorrect and employers could be led to believe that they are not meeting their legal requirements. Employers can check they have a genuine HSE law poster by checking the unique, serially numbered hologram on each poster.

Vinny Kenny, from HSE said:

"The information that is being sent out by some companies may be misleading under consumer protection legislation and we want to put a stop to it. If businesses receive any promotions relating to the Law poster or pocket card and are in any doubt about their authenticity they should contact HSE on 0845 945 0055 before parting with their money."

The HSE launched updated versions of the health and safety law poster and pocket card in April 2009. The updated versions provide clearer information for workers about their right to have their health and safety properly protected.

Under HSE Information for Employees Regulations businesses have five years to switch to the new poster and pocket cards, so they must be replaced by 5 April 2014.  Employers displaying the old poster after 6 April 2009 must ensure it is legible and that the addresses of the enforcing authority and the employment medical advisory service are up to date.

The new law poster, pocket cards and Easy Read and Large Print formats can be ordered from HSE Books on: 01787 881165. The pocket card and Easy Read and Large Print formats can also be downloaded free of charge from the HSE web site.

Internet link: HSE guidance

Pension payments 

Pension contributions made by an individual are usually paid net of basic rate tax. Where the individual is a higher rate taxpayer further relief is due which significantly reduces the net cost of the contribution.

In the Budget this year the government announced its intention to restrict tax relief on pension savings with effect from 6 April 2011 for people with taxable income of £150,000 or more. The relief will be tapered down until it is 20%.

Legislation has been introduced to prevent those potentially affected by the new rules from seeking to forestall this change by increasing their pension savings in excess of their normal regular pattern. The legislation has been amended on its way through the parliamentary process.

The forestalling measures as originally proposed potentially apply to individuals with incomes of £150,000 or more who, from 22 April 2009, change:

• their normal pattern of regular pension contributions, or
• the normal way in which their pension benefits are accrued, and

their total pension contributions or benefits accrued exceed £20,000.

The amendments will permit taxpayers who currently pay premiums of over £30,000 on an annual or irregular basis to benefit from higher rate tax relief on contributions of up to £30,000.

Andrew Hubbard, Chartered Institute of Tax (CIOT) president, said:

“The CIOT highlighted the unfairness in the original proposals, which favoured those who paid, or whose employer paid, regular monthly or quarterly pension contributions, while disadvantaging those who made less regular contributions.

The self-employed typically make annual contributions only once their income for the year has been determined.

We welcome the fact that the government has listened to our concerns. We had hoped that the changes would have gone further, but we can appreciate that the current adverse financial conditions have necessitated some tough decisions.”

If you would like advice on pension contributions please do get in touch.

Internet links: CIOT article HMRC Budget pensions changes

Detailed information on Taxation Matters  has been provided by Sinclair Scott, Accountants 3 Wellington Square Ayr KA7 1EN 01292 288999