Author: Amit Roy

Registering a company as an employer where Directors are from overseas and do not have a National Insurance number.

We need to call HMRC on 0300 200 3200.

Before calling gather following information:

Email of Employer helpline : employer.helpline@notifications.hmrc.gov.uk

Notes:

1. Remember to take down details of the HMRC officer with whom you spoke ; refer to :^{https://www.icaew.com/technical/tax/working-with-hmrc/hmrc-contacts#}
   
2. HMRC does not register employers at virtual office addresses so please ensure to have physical trading address on hand before calling HMRC.
   
3. For an employee who is not in UK and has never been UK tax resident use NT tax code and NIC letter X. See HMRC CWG2 point 4.6.7

When assets become of negligible value in TP’s (taxpayer) ownership, TP may choose to make a negligible value claim. TP is treated as though he had disposed of the asset and immediately reacquired it at the time the claim is made, for an amount equal to the value which is specified in the claim. 

This is most commonly applied to shares where the company goes into liquidation.¹

Claim should be made via a tax return. Date of claim is date of submission of tax return.

Conditions for making a claim are:

• you must still own the asset when you make the claim²
• the asset must have become of negligible value while you owned it.

Set capital loss against income

Usually, capital losses are not allowed to be set-off against income, as capital gains are taxed at a lower rate than income tax.

But if certain conditions³ are met NVC loss can be set off against income.

Limit on losses

For losses made in 2013 to 2014 onwards, the total of all Income Tax losses which can be claimed against a year’s income is limited to £50,000, or 25% of that income if greater.

This limit does not apply to losses on shares to which EIS or SEIS relief is attributable. Helpsheet 204 Limit on Income Tax reliefs (2022) explains which reliefs are included in the limit.

Tax return

1. Provide details of negligible value claim in box 54, ‘Any other information’⁴, on SA108 pages and attach computations with your tax return.

2. Ensure loss is included in boxes 7, 19, 27 or 35 of the SA 108, as applicable, and use code ‘NVC’ in boxes 8, 20, 28 or 36, as applicable, and provide an accompanying computation.

3. To set-off capital loss against income complete Box 41 on SA108.

4. Complete box 42 for losses in shares of EIS or SEIS.

Sample Computation ^{5 and 6}

Deemed disposal proceeds                                                                      £Nil

Allowable costs:

Actual Purchase cost                     £15,000

Less:

Income Tax relief re SEIS               £1,000⁷                                      £14,000              

Allowable Loss  eligible to be set-off against income                      £14,000

Notes:

1. Tolley Exam Training 30.4
2. See Example 1 in HS286.
3. See HS286 for these conditions.
4. Information to include in this box is given in ` How and when to claim the relief` section of HS286.
5. See Example 4 in HS286.
6. Good computation examples given in Tolley Tax computations 227.2 and 15.5
7. Assumed less than 50% relief claimed in the year of investment due to insufficient taxable income.

In simple terms – annual PAYE process for most employers.

-Send final FPS: this is a check box in the PAYE software which needs to be ticked confirming that it’s the final FPS of the year.

– Issue P60: once step 1 has been completed, we need to issue P60 to all employees employed as at 6^th April. Some software send P60s to all employees even those who left. So ensure to exclude the leavers when sending P60s. Also save a copy in your records.

– Submit P11d forms to HMRC and ask employer to pay Class 1A National Insurance. Employee also needs a copy for their self assessment tax return.

– Update Software: all PAYE software must be updated once the tax year ended. Usually the software will prompt you automatically to update it once you logging. Alternatively, visit software provider’s website for instructions.

– Update tax code for the new year: please use HMRC guide P9X for this.

– Update staff salary with National Minimum wage. Adjust director’s salaries where required. Be aware National Minimum wage increases not from 1st April but from first pay reference period starting after 1st April. See ACAS link.

-Review eligibility for Employment Allowance in the new tax year. Also check for connected businesses.

-Review Pay/RTI dates ; sometimes software does not carry it forward correctly.

Bonus points:

1 – Before every payment run employers need to download tax notices from HMRC website. HMRC has made a very good free software – HMRC Desktop Viewer.  Most software will have an inbuilt facility to download PAYE notices.

2 – We are using MoneySoft payroll for our payroll. We find it easy to use and value for money.

3 – HMRC version of this guide.

4 – Payrolling of benefits delayed by one year to April 2027.

VAT late payment penalties are changing for VAT periods ending on and after 1^st April 2025.

No change in late payment interest rules. Interest charged from due date till payment date at 2.5% plus Bank of England Base rate per annum.

Source

Spring Statement 2025 (HTML) – GOV.UK

Bonus

1. Payment plan can only be set up if there is no other plan set up.