ADPL's Business Insider May 2022.NEW LAW TO RESOLVE COVID RENT DEBT.The Government has set up an arbitration system to help resolve outstanding commercial rent debts as the general moratorium on commercial eviction ends.From 25 March, a legally binding arbitration process is available for eligible landlords and tenants who have not yet reached an agreement.NATIONAL INSURANCE AND DIVIDEND 1.25% UPLIFT UNDERWAY.The Government has at last increased National Insurance (NI) and dividend tax by 1.25 percentage points after monthsof anticipation.The 1.25% uplift came into effect on 6 April 2022 and will apply until April 2023, after which a separate health and social care levy will apply on peoples’ income at 1.25%.MTD FOR VAT ROLLS OUT TO ALL VAT- REGISTERED BUSINESSES.All VAT-registered businesses must comply with Making Tax Digital (MTD) rules, regardless of how much they make each year.Kicking in from 1 April 2022, the changes mean all VAT- registered businesses must compile and submit VAT returns using software that connects to HMRC’s systems.
IR35 REFORM LANDING PERIOD ENDS
Penalties now apply to businesses that make mistakes under new IR35 rules for the private sector.The Government extended the off-payroll working rules reform to the private sector in April 2021, but promised to be lenient on mistakes in the first year.The landing period has now ended, so employers caught within the reformed IR35 rules will have to pay a penalty of their unpaid tax between 30-100%.Introduced in 2000, IR35 was designed to prevent tax avoidance by contractors who supply their services via intermediaries in a way so they enjoy the benefits of ‘employment’ and a lower tax rate than actual payrolled employees.Known as ‘disguised employment’, this loophole was costing the Government millions of pounds in lost taxes each year.Recent updates made the hirer, rather than the contractor, responsible for designating employment status and rolled out the new rules from just public sector businesses to medium and large private businesses.After one year, some businesses seem to be struggling, with one YouGov survey suggesting the reform of IR35 has negatively impacted the finances of two in five companies.Derek Cribb, chief executive of the Association of Independent Professionals and the Self-Employed, said:“The changes to IR35 in the private sector in April 2021 have made it harder for [businesses] to hire contractors and has therefore made it even more difficult for them to grow during these turbulent economic times.”
Business minister Paul Scully said:
“This new law will give commercial tenants and landlords the ability to draw a line under the uncertainty caused by the pandemic so they can plan ahead and return to normality.“Landlords and tenants should keep working together to reach their own agreements where possible using our code of practice to help them, and we’ve made arbitration available as a