Shacter, Cohen & Bor - CHARTERED ACCOUNTANTS
CAPITAL GAINS TAX   The current exemptions for Capital Gains Tax are as follows:-
Annual Exemption   2003/04   2004/05
    £7,900   £8,200
    Business & Assets   Non-Business Assets
Taper Relief Whole Years
Held		 % of Gain
Chargeable		 Whole Years
Held		 % of Gain
Chargeable
  1 50 1 100
  2 or more   2 100
      3 95
      4 90
      5 85
      6 80
All business assets acquired before 17 March 1998 qualify for 8 70
one extra year of ownership. Transfers between husband and 9 65
wife living together are exempt from Capital Gains Tax. 10 or over 60		 7 75
8 70
9 65
10 or over 60
PAVE COMPLIANCE

At this time of year it is important to be aware of the time limits for submission of end of year P35 returns and the new P11 D (b) return which reports Class la NIC payable on P11D benefits in kind. P35 returns were due for submission on or before 19 Ma 2004 and late returns will carry an automatic penalty. Ill 11) (b) returns must have been submitted no later than 6 July 2004 to avoid penalties.
All new employees should present a form P45, or the employer should insist on a form P46 being completed to protect the employer from a possible PAYE (22%0 or NIC (23.8%0 retrospective liability.
The Inland Revenue have special teams targeting employers payrolls. Many clients now use our computerised payroll department to save them the time, hassle and exposure.
It might be possible to reduce the burden of PAYE Compliance by applying to the Inland Revenue for dispensation in respect of reimbursed expenses which would normally have to appear on P11D returns. If business reimburses employees and directors' expenses you should speak to your normal contact regarding the possibility of dispensation request.
NEW EMPLOYMENT RULES
Considering employing someone, read on ...

Employers should remember that it is a criminal offence under Section 8 of the Asylum and Immigration Act 1996 to employ someone who is not entitled to work or to do that particular job in the UK, and currently the penalty for non-compliance stands at a whopping £5,000 per employee. From 1 May 2004, employers need to ensure appropriate documents are received and recorded. These include, for example, a passport showing that the holder is a British Citizen, or has a right of abode in the UK, and a document showing that the holder is a national of a European Economic Area (EEA) country. For every new potential employee that you may be considering offering employment to, you will be required to have documentary evidence of their entitlement to work in the UK. Therefore, you must ensure that you have seen and checked the appropriate documentation.
Nationals from EEA countries can enter and work in the UK without any restrictions just like British Citizens . The same is also the case for their immediate family members. You should not, however employ any individual on the basis of his or her claim to be a national from an EEA country as you will put yourself at risk of employing someone illegally if this claim is false. You should ask nationals from all EEA countries to produce a document showing that nationality.		 Also, with effect from 1 May 2004, the Government is introducing a Workers Registration Scheme for eight of the countries that have become new members of the EEA, namely Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia. You will need to make sure if a person from one of these eight countries starts working for you after 1 May 2004 that they register with the Home Office. If you are already employing a national from one of these countries legally, then they will not be required to register.

Please contact Mohammed if you require further details, for example, list of appropriate documents and who is part of the EEA.

MONEY LAUNDERING


Clients may be aware, from recent press coverage of the money laundering regulations, that with effect from 1 March 2004, firms of Accountants such as ourselves are covered by the legislation contained in the Proceeds of Crime Act 2002 and in Money Laundering Regulations 2003.
The legislation now places an obligation upon ourselves to report to the National Criminal Intelligence Service (NCIS) any instances where we have suspicions or knowledge or ought to have suspicions or knowledge that any person has committed an offence under the above legislation.
Whilst the legislation may originally have been targeted at money laundering in relation to drug offences and serious crime, the legislation has no de-minimus and therefore all cases are covered under the legislation. Clients should be aware that wherever they have a pecuniary advantage arising from a criminal act this is a reportable offence, and should this come to our knowledge, we need to make a report to NICS.
Matters covered that may be relevant to clients would include late filing of Annual Returns, not returning credit balances on sales ledgers to customers, falsifying accounting records, completion of incorrect tax returns, non disclosure of taxable income on tax returns, etc. Whilst the Act lays down procedures that we as a firm must adopt, the Act also lays down criteria that we must comply with ourselves in order not to contravene the Act or regulations themselves which include:-
Aiding and abetting.
Advising clients that a report has been made to NICS.
Clearly the effect of the new legislation is going to impact generally on the accounting profession and clients need to be aware of our new obligations under the law.
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31 Sackville Street, Manchester, M1 3LZ. Telephone: 0161-236 3909 Facsimile: 0161-236 8490 reception@shacter-cohen-bor.com>
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