New Advisory Fuel Rates

A new set of Advisory Fuel Rates came into effect from the beginning of December 2019, which apply to employees who use a company car.

The rates can be used in circumstances where you are reimbursing employees for business travel in their company car or in requiring employees to repay the cost of fuel used for private journeys. If you use these rates, you will not need to seek a dispensation to cover the payments.

The new rates are:

Engine size Petrol – amount per mile LPG – amount per mile Diesel – amount per mile
1400cc or less 12 pence 8 pence 9 pence
1401cc to 2000cc 14 pence 9 pence 11 pence
Over 2000cc 21 pence 14 pence 14 pence

Hybrid cars are treated as either petrol or diesel cars for the purposes of Advisory Fuel Rates.

Meanwhile, the Advisory Electricity Rate for fully electric cars is 4 pence per mile, although electricity is not considered a fuel for car fuel benefit purposes.

Link: HMRC advisory fuel rates for company car users from 1 December

Reminder: National Living Wage set to increase from April

On 1 April 2020 the Government will introduce increases to the National Living and Minimum Wage.

From this date the National Living Wage (NLW) will rise from £8.21 to £8.72 per hour and will mean that 2.8 million full-time workers will see a £930 boost to their annual earnings.

The Government claims that the introduction of the NLW, which is available to those aged 25 and over, has delivered the fastest pay rise for the lowest earners in 20 years.

From April workers who are paid the National Minimum Wage (NMW) will also see their pay increase. The table below outlines the new rates of pay:

Year 25 and over 21 to 24 18 to 20 Under 18 Apprentice
April 2019 (current rate) £8.21 £7.70 £6.15 £4.35 £3.90
April 2020 £8.72 £8.20 £6.45 £4.55 £4.15

As well as increasing the NLW, the Chancellor Sajid Javid has said that the Government intends to expand the reach of the NLW to cover workers aged 23 and over from April 2021, and to those aged 21 and over within five years.

Link: National Minimum Wage and National Living Wage rates

Should your company pay a data protection fee?

We are aware that the Information Commissioner’s Office (ICO) has been contacting companies to remind them of their legal obligation to pay a data protection fee.

The ICO has confirmed that the UK’s 4.2 million limited companies will receive letters sent to their registered office addresses making them aware of this obligation, which is mandatory for some data controllers.

While the notice implies that all registered companies should pay a data protection fee of £40, some companies will be exempt from this legislation.

Where the processing of data is solely to keep accounts, records of purchases, sales or other transactions, deciding whether to accept any person as a customer or supplier, or making financial or financial management forecasts, the business is likely to be exempt under the Schedule to the Regulations.

However, the ICO has posted on its website that “if you hold personal information for business purposes on any electronic device…it is likely an annual fee payment is due”.

To determine whether or not you are exempt, complete a short questionnaire on the ICO’s website here.

Please be aware that failure to pay the fee in circumstances where no exemption applies may attract a penalty of up to £4,350.

Link: Registration for ICO self-assessment

More than 3,000 taxpayers complete self-assessment on Christmas Day

Instead of tucking into turkey or unwrapping their gifts, 3,003 taxpayers completed their self-assessment returns on 25 December 2019, according to HM Revenue & Customs (HMRC).

Every year hundreds of people across the UK use the Christmas break as a time to manage their financial affairs, with HMRC declaring it a “Christmas tradition”.

HMRC said that peak times for self-assessment submissions on Christmas Day were between 12:00 and 12:59 when more than 245 customers filed online.

Incredibly, Boxing Day saw more than three times the number of submissions than Christmas Day with 9,524 taxpayers logging on to submit their tax records, while Christmas Eve was busier still with 22,035 self-assessment returns submitted.

Angela MacDonald, HMRC’s Director General for Customer Services, said: “Whether you squeezed it in before tucking into a Christmas pudding, after the Queen’s Speech or trying to grab a bargain during the festive sales; our online service is available for you to file your tax return, at any time you wish.”

More than 11 million customers are expected to complete a 2018/19 self-assessment tax return form by 31 January 2020, which is the final deadline for online submissions. Failure to submit your tax return on time could lead to an automatic fine of £100 with further penalties depending on the lateness of a submission.

For any taxpayers who are yet to start their 2018/19 self-assessment return, it is strongly advised that they seek professional assistance or gain help via GOV.UK or from the official self-assessment helpline on 0300 200 3310.

Even if taxpayers completed a self-assessment tax return last year but didn’t have any tax to pay, they will still need to fill out a 2018/19 tax return, unless HMRC has written to them to say that it is not required.

Link: ‘We’ve been Santa lot of Elf Assessments’ says HMRC