Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent representations has he received on section 684 notices.
Answered by Nigel Huddleston - Financial Secretary (HM Treasury)
In May 2022, the Court of Appeal confirmed that HMRC could use provisions in tax legislation (section 684(7A)(b) of the Income Tax (Earnings and Pensions) Act 2003). HMRC is using these provisions in line with the Court of Appeal judgment.
The Government has received representations about s684(7A)(b) from several Members on behalf of their constituents, as well as the All Party Parliamentary Group on the Loan Charge and Taxpayer Fairness.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many sole traders have experienced delays in repayment of VAT following an HMRC VAT Refund software upgrade in 2021; and what steps his Department is taking to tackle those delays.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
HMRC made no upgrades to its VAT repayment software in 2021. There are no current delays, other than those that may occur from time to time in the course of business when HMRC carries out additional checks on a repayment claim.
HMRC makes VAT repayments to over half a million VAT registered businesses every year, including sole traders. It is important that HMRC makes checks on repayments in order to prevent fraud. HMRC aims to complete these checks as quickly as possible to minimise disruption for businesses.
HMRC’s code of practice for dealing with delayed VAT repayment returns is set out in Notice 700/58. As explained in the notice, HMRC will in certain circumstances pay a repayment supplement if a repayment is not made within 30 days. Over 95 per cent of repayments are made within 10 days and over 99.75 per cent of repayments are made within 30 days.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will (a) make an assessment of the disputed interpretation HMRC has placed on the scope of the agreement between HMRC and Roadchef Employee Benefit Trustees, arrived at by mediation and (b) take steps to resolve that matter.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
The administration of the tax system is a matter for HM Revenue and Customs, who continue in dialogue with the customer.Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will negotiate a consistent rate of VAT with the EU across all EU member states on the sale and purchase of classic cars.
Answered by Jesse Norman
The VAT rates applicable in EU Member States are a matter for the EU. In the UK, a lower rate of 5% import VAT is available for classic cars where these are collectors’ pieces of historical interest.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what plans he has to allocate funding to local authorities for distribution to businesses not eligible for the Retail, Hospitality and Leisure Business rates relief.
Answered by Jesse Norman
The Government is providing £1.5 billion of additional support to businesses that have not already received business rates relief. The relief will be allocated to local authorities based on the stock of properties in the area and the sector-specific economic impacts of COVID-19. The Government will also work with and support local government to enable ratepayers to apply as soon as possible this year, once the legislation relating to Material Change of Circumstance provisions has passed and local authorities have set up local relief schemes.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what limitations are placed on holiday entitlement for people who have been on furlough.
Answered by Jesse Norman
Employees can take holiday while on furlough. If an employee is flexibly furloughed, then any hours taken as holiday during the claim period should be counted as furloughed hours rather than working hours.
Employees should not be placed on furlough for periods simply because they are on holiday. This means that employees should only be placed on furlough because their employer’s operations have been affected by the coronavirus pandemic and not just because they are on paid leave. This also applies during peak leave periods such as late December and early January.
Existing legislation means that furloughed employees continue to accrue leave as per their employment contract. The employer and employee can agree to vary holiday entitlement as part of the furlough agreement. However, almost all workers are entitled to 5.6 weeks of statutory paid annual leave each year which they cannot go below; for workers who work a five-day week, this amounts to 28 days each year.
Working Time Regulations (WTR) require holiday pay to be paid at the employee’s normal rate of pay or, where the rate of pay varies, calculated on the basis of the average pay received by the employee in the previous 52 working weeks. Therefore, if a furloughed employee takes holiday, the employer should pay them their usual holiday pay in accordance with the WTR. Employers will be obliged to pay additional amounts over the CJRS grant, although they will have the flexibility to restrict when leave can be taken if there is a business need. This applies for both the furlough period and the recovery period.
If an employee usually works bank holidays then the employer can agree that this is included in the grant payment. If the employee usually takes the bank holiday as leave then the employer would either have to top up their pay to their usual holiday pay, or give the employee a day of holiday in lieu.
During this unprecedented time the policy on holiday pay during furlough is being kept under review.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what the level of outstanding refunds of corporation tax is at 16 March 2021; and what assessment he has made of the performance of HMRC against its target timetable for making such repayments.
Answered by Jesse Norman
Information in the form requested is not readily available and could only be obtained at disproportionate cost.
Like other service organisations, HMRC have been affected by the pandemic and are doing all they can to offer the best possible service to their customers, whether supporting them with their taxes or delivering the Government’s support schemes. HMRC are sorry for delays and will continue to prioritise Corporation Tax repayments, ensuring taxpayers receive moneys due as quickly as possible during this exceptional time.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what progress he has made in setting up a compensation scheme for London Capital and Finance bondholders.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
In my Written Ministerial Statement on 17 December 2020, I outlined the three main channels through which London Capital & Finance plc (LCF) bondholders can seek compensation. These are the administration process, the Financial Services Compensation Scheme (FSCS), and the Financial Conduct Authority’s (FCA) Complaints Scheme.
My statement also announced that, taking into consideration the specific and complex set of circumstances surrounding the collapse of LCF, the Treasury will set up a compensation scheme which will assess whether there is justification for further one-off compensation payments in certain circumstances for some LCF bondholders . The Government will announce further details, including on timescales, the scheme’s administering body, and the eligibility of compensation, in due course.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of giving the retail sector an early indication of the future business rates for which they will be liable.
Answered by Jesse Norman
This year the Government has provided an unprecedented business rates holiday for eligible retail, hospitality and leisure properties due to the direct adverse effects of COVID-19, worth about £10 billion, and has frozen the business rates multiplier for all businesses for 2021-22.
The Government is also considering options for further COVID-19 related support through business rates reliefs. In order to ensure that any decisions best meet the evolving challenges presented by COVID-19, the Government will outline plans for 2021-22 reliefs in due course.
Asked by: Desmond Swayne (Conservative - New Forest West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate he has made of the costs to businesses of interfacing their accounting software with HMRC in compliance with reguirements for the digitisation of reporting.
Answered by Jesse Norman
The costs incurred in the move to digital record keeping and reporting through Making Tax Digital (MTD) will vary from business to business, and are dependent on factors such as business size, complexity, degree of digital capability and the cost and functionality of the software used. There are free software products available for businesses with the simplest affairs.
HMRC’s early estimates published on 21 July anticipated that businesses will incur costs of, on average, £175 to make the transition to MTD, with about £20 a year in additional continuing costs. HMRC have since undertaken significant engagement with representative bodies within both the business and accountancy worlds, as well as software developers, in order to further understand the associated costs of future MTD mandation. These costs represent an investment that will yield dividends in terms of increased productivity and turnover. HMRC are working with these bodies in order to ensure estimates are accurate and will do all they can to minimise costs. A new publication with revised estimates will be published in due course.