HMRC brings in record £131m from tax status checks

Tax inspectors have been coming down hard on the construction industry and it’s paid off for them!

Extra payments from builders, plumbers and electricians after tax status checks by HM Revenue and Customs saw the figure rise to £131m in the year to March 2014. This is an increase of 7% from the £121m they took the year before.

If you look at the figures from 5 years ago, the yield from tax compliance investigations into the construction sector has nearly doubled.

As well as targeting construction businesses directly, HMRC is now also turning its focus to employment intermediaries who help to process the pay of contractors.

Last month HMRC confirmed that from April 6 2015, employment intermediaries will have to start providing quarterly reports explaining why workers on their payroll are not using PAYE.

HMRC tax probe yields

  •     2006-07: £56.0m
  •     2007-08: £57.2m
  •     2008-09: £65.6m
  •     2009-10: £68.9m
  •     2010-11: £66.9m
  •     2011-12: £78.9m
  •     2012-13: £121m
  •     2013-14: £131m

 

Failing to comply with HMRC could result in a big tax bill and a loss of flexibility in employment, which is vital for construction workers.

If you are currently working as a contractor in the construction industry, contact us today and we will be able to advise you on what you need to do as of April 6, 2015.

Patent Box Tax Relief

If your company is liable to Corporation Tax and makes a profit from exploiting patented inventions, you may qualify for Patent Box Tax Relief.

Your company must own or exclusively license-in the patents and must have undertaken qualifying development on them.

Your company can also benefit from the Patent Box if it uses a manufacturing process that is patented or provides a service using a patented tool.

The full benefit of the regime has been phased in from 1 April 2013.

From this date companies should have benefited from a reduced rate of corporation tax in respect of profits derived from patented products and by 2017 the rate of tax will be reduced to nil!

The relief is available on profits from the patent pending stage, but cannot be claimed until the patent is granted.

As you may know,  patents can sometimes take years to be granted so it’s important to make a claim for this relief at the patent pending stage, to ensure that no time limits are missed and no relief is lost!

If you think you qualify for this, don’t hesitate to get in touch with us today and we will be happy to talk you through Patent Box Tax Relief and how we can help you.