savings 300x235 ISAs  a practical guide to what happens between now and the 1 July NISAsNew ISAs (or NISAs, as they are ‘nicer’ than the old ones) come into effect on 1 July 2014. The delay between last month’s announcement and introduction will allow providers to get their systems and processes in order before the new rules kick in, but where does that leave you if you have an ISA wedge burning a hole in your pocket, ready for 6 April when the new tax year starts?

So how much can I pay into my ISA on 6 April 2014?

On 6 April, the old rules will still apply. This means the maximum amount that can be contributed to a stocks and shares ISA is £11,880 and £5,940 into a cash ISA. However, on 1 July the limit will increase to £15,000 for both stock and cash ISAs, so you can then whack  in the extra £3,120/£9,060 on that date.

But I pay into my ISA monthly?

A few years ago the ISA limit was adjusted so it always fit roundly into a monthly figure, and from 6 April the monthly figure works out at £990. You could contribute £990 for three months and then pay £1,366 to reach the £15,000 contribution limit, or you could just start paying the new monthly figure of £1,250 from this month, as you would not exceed the old annual limit before the limit was increased in July.

Am I still limited to one provider?

You are still limited to one provider per tax year, for each of a cash and stocks ISA, but as before you can transfer previous ISA balances to another provider- something that has been particularly useful for cash ISA holders who found  themselves lumped with a rubbish rate of interest. Note that you can now transfer both current and old stock ISA balances into new cash NISAs- if you have found the stock market too volatile for your delicate risk/reward balance for example.

As always, remember that you must always complete the required ISA transfer forms when moving ISA cash- as otherwise it will count as a new contribution.

Anything else?

Many of the stocks and shares ISA supermarkets have announced new charges following the changes to platform charges and commission – even if your previous provider has been good value it may be worth looking at alternatives to make sure it is still the best one for your circumstances. There are some comparisons out there- like this one- and the best choice will depend on how much you have to invest, your choice of investment, how many trades you are likely to make and how much pretty apps mean to you.

stressed doctor Proposed new £10 per month charge for the NHS...Some people say the NHS is what makes Britain great, and the principle of free healthcare for all is one cherished by many. Now, however, a Labour peer is calling for NHS treatment to be limited to those contributing a monthly fee in order to become NHS members.

In a report published by think-tank Reform, Lord Warner, who was in charge of health service reform under the Blair government, is calling for a combination of membership fees and ringfenced taxes to protect the NHS and guard it against collapse under the weight of chronic illnesses.

Currently NHS spending is protected in Governmental budgets, but Lord Warner argues that this “risks seriously damaging other public services” as a consequence.

In addition to earmarking sin taxes as going directly to the NHS and increasing inheritance tax, the report also suggests that “some form of social care tax” could be introduced in middle age. Whenever that is. Lord Warner cites the case of  Japan, which introduced a such a compulsory levy in 2000, which “helped considerably to fund the care costs of their ageing population”.

An NHS “membership fee”, which would be gathered along with the council tax, of around £10 per month should also become compulsory and would fund preventative care but would also entitle each “member” of working age to a health “MOT”.  Groups entitled to free prescriptions would be exempted.

A spokesman for the Department of Health said: “The founding principles of the NHS make it universally free at point of use and we are clear that it will continue to be so. This government doesn’t support the introduction of membership fees or anything like them.

“But we know that with an ageing population there’s more pressure on the NHS, which is why we need changes to services that focus far more on health prevention out of hospitals.”

So is it just a matter of time until we all have to dig into our pockets? Or is there a better alternative?

Downloads to cost more

March 24th, 2014 4 Comments By Ian Wade

george osborne 300x300 Downloads to cost moreThe 99p-a-tune download may be at an end.

The problem-haired joybringer George Osborne is bringing in new laws making sure that internet downloads are taxed in the country they are purchased.

This means, that Apple and Amazon will have to charge the UK’s 20% rate of VAT. The current situation they are allowed to sell digital downloads via places like Luxembourg, where the tax rate is as low as 3%.

This will affect books, music and apps and comes in from January 1 2015.

His budget document said:

“As announced at budget 2013, the government will legislate to change the rules for the taxation of intra-EU business to consumer supplies of telecommunications, broadcasting and e-services. From 1 January 2015 these services will be taxed in the member state in which the consumer is located, ensuring these are taxed fairly and helping to protect revenue.”

2013 saw singles ales at their highest for years, so after 2015 consumers are going to go the extra to obtain their music. Or maybe they’ll not bother and riot instead.

Meat tax! The latest sin tax proposal…

March 24th, 2014 1 Comment By Thewlis

cow 224x300 Meat tax! The latest sin tax proposal...While some of the Chancellor’s Budget announcements have been almost universally welcomed (other than by annuity companies), others have subjected Gorgeous George, and his party to some ridicule, and spoof ads. But it could have been worse- imagine the uproar if he had implemented the latest tax idea from campaigners PETA. A meat tax.

That’s right. The cabbage-eating sorts consider meat the next “obvious culprit” for being the subject of a sin tax, such as those levied on cigarettes and alcohol in the name of public health. Of course, it is only health organisations who have criticised last week’s scrapping of the alcohol duty escalator and drop in beer duty given that it will, accidentally perhaps, also make brain-frying Tennent’s Super cheaper. What with that and whisky, Scots must be loving Westminster right about now…

But back to meat tax. PETA managing director Ingrid Newkirk believes they have come up with “a practical, money-saving suggestion that would score highly on both the fiscal and the moral front” saying:

“Consumers already pay duty, or “sin”, taxes on cigarettes, alcohol and gasoline to help offset their health and environmental costs, yet although eating flesh and animal secretions is another unhealthy habit as well as a leading cause of climate change, it has so far escaped being taxed. Unfair! And unhelpful.

Now. You might write this off as the deranged ramblings of someone suffering an iron deficiency, but Ingrid has actually found a similar proposed tax to support her point- a ruminant tax proposed by scientists writing in the journal Nature Climate Change. That’s right, the meat tax is apparently vindicated by the suggestion we should have a fart tax on cows to limit greenhouse gases.

Disappointingly for PETA, a meat tax is not on the cards, although discussion still rumbles over other food sin taxes, such as sugar or saturated fat tax to try and tax the lardy more than the wealthy. Still, PETA reassures us that we don’t have to wait for a meat tax, we can all become vegetarian, or preferably vegan, right now.

I’ll get my sprout.

Budget 2014- how does it affect you?

March 20th, 2014 1 Comment By Thewlis

Budget box 1332 19856581 0 0 7059907 300 Budget 2014  how does it affect you?So, the Budget has come and gone for another year, and if you’re feathering a nest-egg or are grey haired and wrinkly, you’re probably feeling pretty happy with yourself this morning. The Budget has been hailed as one for savers and pensioners, so how do the changes affect you?

Pensions and pensioners
In a massive turnaround, the rules regarding pensions are to change and will allow people to actually access their own money on retirement. Currently, pensioners are forced to buy an annuity, and with interest rates so low, this has meant a poor return for years of saving. New rules will allow people to access their cash immediately they retire, with a less punitive tax rate of 20% (rather than 55%).

Unsurprisingly, insurance companies who sell these annuities are unimpressed, and the value of the top pension companies on the stock market fell sharply yesterday. George has also come under fire for allowing potentially irresponsible people to spend their own money- with fears that new pensioners will just blow all their pension cash on a trip to Vegas or something. The Chancellor argues that those who have been responsible enough to save over a number of years probably have more sense.

The Chancellor also announced relaxations on the maxima for investing in Premium bonds, as well as special new Pensioner Bonds, paying “market-leading” rates, available from January to over-65s, with possible rates of 2.8% for one-year bond and 4% for three-year bond. Up to £10,000 can be saved in each bond.

ISAs and savings
The big news for savers is that, far from being cut, ISA limits have actually been increased to £15,000 per year. Not only that, but now you can invest the whole amount in cash if you so wish (currently only half of the annual limit could be held in a cash ISA), and transfer funds between a cash and shares ISA.

This is a considerable increase, and would allow savers to protect much more savings from tax. However, given that most people couldn’t afford to utilise their whole allowance beforehand, the cynical among us might wonder who exactly this change will benefit. The Institute for Public Policy Research suggested that, even assuming a massive 20% of net disposable income is available for savings, savers would need to be earning £125,000 gross a year in order to take full advantage of the changes.

In addition, the Chancellor announced a tax rate cut for those who only have savings income. The historic savings rate only applies where the only taxable income was savings income, and allowed up to £2,880 to be taxed at 10% instead of 20%. For 2015/16 onwards the starting rate for savings income will reduce from 10% to 0%, and the maximum amount of an individual’s savings income that can qualify for this starting rate will increase to £5,000.

Duty changes
But never fear, this Government has not forgotten the little people, and the working class should be happy with a 1p duty reduction on beer and a slashing of the Bingo duty. Because that’s not stereotypical and condescending at ALL. Fuel and cider and spirits duty have been frozen (for now), but cigarette duty will increase by 2% above inflation.

Your pocket
Finally, there are some changes that will directly affect your pocket. The personal allowance will hit £10,000 in April this year, a small victory for the LibDems, but the budget announced that the allowance will increase to £10,500 from April 2015. The amount of transferable personal allowance (announced last year) will also go up by £50 to £1,050.

Currently, parents can get up to 80% of childcare costs of up to £10,000 per child, aged up to 12, paid for, but now the remaining 20% can be claimed from the government tax-free with effect from September next year.

The Help to Buy scheme, which offers a loan to people buying a home in England costing up to £600,000 has been extended for four more years to 2020.

Finally, a change to green taxes on energy will save the average family £15 on their annual energy bill, which is better than nothing, but not a huge dent in the average household’s energy bill.

pensions 300x187 Budget help for those with smaller pension pots?In Budget week there’s always speculation about what will be contained within the little red box. A number of things are being bandied about, but as ever we will have to wait until Wednesday to find out for sure.

However, one thing that could have a massive impact on people for years to come could be a change to the rules regarding private pensions. Coming on the back of an ever-lengthening working life,as the state retirement age increases more and more rapidly, something to help out those without million pound pension pots, can only be welcomed.

Campaigners have been lobbying the Government on behalf of those holding smaller pension pots of less than £15,000. Back in the day, when people had a job for life (and most likely a final salary pension), this was a rarer occurrence. However, nowadays people tend to change jobs more frequently, giving rise to the potential for a number of smaller pots with different employers.

The problem with small pots is that they are still subject to the same rules on buying an annuity as other, larger pots, but much more difficult to obtain- most providers aren’t interested in small change, the rates are proportionately lower and pensioners would have to pay duplicate annuity fees and charges on each small pot. By way of an example, a 65 year old with a £10,000 pot might be able to buy an annuity of £7.50 a week.

Now, it might be possible for these smaller pots to be combined into another pension vehicle, for example a SIPP (Self Invested Personal Pension), and possibly raise a larger nest-egg with better purchasing power but what if they can’t? Current rules allow pensioners to withdraw the full amount as a lump sum only where the total of all pots comes to £18,000 or less.

But new rules that are rumoured to be included in this week’s Budget might solve the problem. Sources suggest that the rules will be relaxed to allow pots of up to £15,000 to be released as lump sums- and allow people to , perhaps, pay more than £7.50 a week off their mortgage. Clearly, full details will need to be scrutinised, but this move could immediately help up to 150,000 people a year, according to Daily Mail figures.

Taxman not interested in Bitcoin

March 3rd, 2014 2 Comments By Mof Gimmers

bitcoin1 300x300 Taxman not interested in BitcoinBitcoin – or, as it should be called: Hippie Money – is a real buzzword at the moment, despite the fact that the vast majority of people don’t know what it is.

Either way, this new currency is becoming quite the thing for web-crusties who look at it like it is our saviour from the banks, despite having to shut down recently, thanks to a massive loss. In Britain, it is all set to grow as HMRC rules that they’re not at all interested in charging VAT on Bitcoin transactions.

Yet.

The Tax People held talks with UK Bitcoin traders last week and decided that they would not charge the 20 per cent VAT tax on trades, and, on top of that, wouldn’t be charging the tax on entrepreneurs’ Bitcoin margins either.

Suddenly, shark-eyed business sorts are thinking of getting on-board with the Hippie Money now that Britain will be one of the most tax-friendly places for this cryptocurrency. And they’re right to keep an eye on it. At the moment, there’s around $6.9bn worth of Bitcoins in circulation.

As Bitcoins are not traceable, this could be an excellent area for criminals and tax-dodgers to get involved in. Your dealer might start dealing solely in Bitcoins. Vodafone and Chris Moyles might start getting on it too.

Jonathan Harrison, someone looking to bring Bitcoin ATMs to the UK, thinks this is good news, saying: “If they had added VAT that would have destroyed us, there would have been no point in starting this business at all. It’s great that the UK authorities are seeing Bitcoin as an innovative technology that can help the economy.”

Is this the money of the future? We all know how well the babyboomer hippies did when it came to making money, don’t we?

Are you better off because you pay your taxes?

February 18th, 2014 4 Comments By Thewlis

tax calc 300x152 Are you better off because you pay your taxes?Few of us actually like paying our taxes, but most of us have little choice in the matter when it is deducted from our salaries before we even get paid. However, it might ease the bitter pill to discover that many of us are actually better off because we pay taxes.

Confused? The answer lies in the net benefits to taxpayers, and accountants Smith and Williamson have concluded that the cut-off point at which you receive less than you contribute is actually higher than you might have thought, and falls on gross household incomes of around £35,000 to £38,000. Anyone earning less than this is, theoretically at least, quids in.

The point at which a household switches from being an overall ‘taker’ to a ‘giver’ is where disposable income, passes a threshold of about £27,000 net. At that point a household is receiving benefits (not just cash benefits, but includes societal benefits such as average usage of school and the NHS) and paying taxes to the extent that the two cancel each other out. If a household earns more than this tipping point, it is a ‘giver’ and pays more in taxes than it receives. If the household earns less, they get more than they pay out, a ‘taker’.

Although Smith and Williamson stress that numerous factors are involved, and dependent on individual circumstances, take the following example of a household with a gross income of £39,000. Just over the break-even, the household would enjoy benefits quantified at just under £12,000, but would be required to contribute almost £13,000 in various taxes, making it a net ‘giver’ by around £1,000.

The calculations showed that, actually, most of us are takers rather than givers. The top 40% of households by earnings are carrying the lower-earning 60%. This is supported by Institute for Fiscal Studies (IFS) figures that suggest 300,000 very high earners, out of about 30 million income tax payers, paid 30% of all income tax. It said that over a period the income tax burden had been pushed increasingly on to this narrow band of top earners- in 1980 the top 1pc of earners paid 11% of all income tax.

At the same time, the number of taxpayers is falling, in part owing to rising personal allowances taking the lowest earners out of tax- between the tax years 2011-12 and 2013-14, the number of income tax payers has dropped by 900,000 to 29.9 million. HMRC has also commented that receipts from higher earners are less predictable, partly because wealthy people can easily emigrate to a more tax-favourable jurisdiction.

So are you a giver or a taker? And which would you rather be- a household with less cash, but getting more out of the deal, or one with more cash, part of which you have to share with 60% of the population…

car2 168x300 Tax man to start offering lottery prizes? If its good enough for the continent...Recently, HMRC announced that, to try and combat tax avoidance, they would start asking for contested tax up front while they decided whether the tax would end up being payable or not. Simple idea but possibly not-to-easy to enforce. We think HMRC are going about this all the wrong way. They need to take a leaf out of the books of an increasing number of tax authorities around the world and offer us, the people, high-end incentives to shop those not paying tax.

Portugal is the latest country to announce a ‘tax lottery’, where ordinary citizens can win a luxury car (unofficial estimated cost to the Portguese taxpayer, €90,000 each) simply by asking for a receipt for a cup of coffee or a haircut.

The black market in Portugal is, described as problematic (at almost a fifth of total output), with a great number of traders not registering with the tax authorities, and therefore never paying any tax. By incentivising customers to ask for an official receipt, complete with tax registration number, Portuguese revenue officials are confident the increase in receipts will more than outweigh the cost of the 60 cars a year being offered as prizes from April.

Tax experts say the measure is designed to appeal to Portugal’s penchant for gambling – the country is one of the biggest spenders per capita on EuroMillions, and to the social prestige attached to expensive cars. The fast lane on Portuguese motorways is sometimes nicknamed the “Mercedes lane”.

However, “If someone needs a plumber or an electrician, I suspect they’ll still be attracted by the discount resulting from not being charged VAT,” said John Duggan, a Portugal-based tax adviser, talking to the FT. “They’d be able to buy a lot of ordinary lottery tickets with the money they save,” he added sagely, charging €200 for this advice*

The idea is new to Portugal, but is not new around the world. A similar lottery run in the state of São Paulo in Brazil provided Portuguese inspiration and comparable schemes are used in Argentina, Colombia, Puerto Rico and Taiwan. It isn’t even the first such scheme in Europe, with  Slovakia’s version offering cash and cars in a tax lottery being run sucessfully since last year.

So could we see National-Lottery-Style adverts from HMRC in future? It could be you driving a nice car for shopping your mechanic to the taxman. Better hope it doesn’t break down…

*not really. This is an accountant joke.

tax 215x300 Government cuts tax bill for big companies, unsurprisinglyThe Government, in their infinite wisdom, have cut the tax bills of loads of our biggest companies by around a quarter in 2013. Politicians think this will cut our debts. Everyone else thinks this is an example of a two-tier rule book.

While companies like Google and Apple make insane amounts of cash, they pay very little tax in the UK, and a group surveyed (which includes some of the biggest UK companies) said their corporation tax bills fell 26%, on top of hefty drops in previous years.

David Cameron has said that this is a bid to encourage businesses to come over here and invest and create jobs.

The 100 Group, including most businesses that appear on the FTSE 100 Index of major businesses, had a tax bill of £6 billion pounds in a survey conducted by PricewaterhouseCoopers (PwC). The 100 Group’s tax bill has steadily dropped since 2006, when members paid £12.6 billion in corporation tax.

A spokeswoman for the finance ministry said: ”Our major corporation tax reforms, part of the government’s long-term economic plan, are supporting jobs, growth and investment, and playing a critical part in delivering a sustainable economic recovery.”

Does that make you feel better?

Asda scraps “3 for £10” on wine.

January 17th, 2014 6 Comments By Thewlis

FineWineCellar 300x300 Asda scraps “3 for £10” on wine.We know you all like a drink, but the latest news from Asda is set to shock oenophiles to the core. No more 3 for £10 wine.

Speaking to Off Licence News, which is a real publication (since 1863), wines and spirits category manager Tracy Ford has said that Asda has “permanently dropped” the popular promotion, described as “central to the retailer’s strategy”. She said:

“Two to three years ago, customer participation with three-for-£10 was really high but with all the work we’re doing to educate consumers and expand the ranges, that has decreased.”

“Also the quality of the wine had decreased because of duty and we felt the time was right to move away,” she finished. Given that £2.94 out of a £5 bottle goes on taxes and duty, an average bottle contains an estimated 20p of wine, after transport, storage and supermarket profit costs. At £3.33 a bottle retail, you’re drinking the grapes left between someone’s toes.

Ford claims that Asda attempted to do away with 3 for £10 in three years ago, but were forced to reinstate it after customer complaints, as Asda “didn’t give consumers an alternative.” Now, however, Asda have a new plan to keep their customers slightly squiffy. Cheap wine.

Yes, Asda’s new strategy is to introduce “a new portfolio of wines priced at £3, £3.50 and £4 to fill the gap”. We’re no mathematicians, but even we can work out that three bottles of £3 wine works out at £9. Last time we checked that was less than a tenner.

Obviously not that fussed about the quality then…

tax letter Dont get caught by copycat websites  especially when filing your Self Assessment return by 31 JanuaryIf there’s one thing the new year hasn’t seen the back of, it’s scams, and the most recent scam-a-la-mode is the copycat website scam.

Scam sites can cover anything, but their weapon of choice tends to be governmental type document completion, ideally where there is a fee to be paid. Recent scam sites found included provisional driving licence, European health cards and passports as well as congestion charge and even self-assessment tax return sites.

Last week, the Advertising Standards Authority upheld a complaint against paylondoncongestion.co.uk, which charges drivers a premium for paying the London Congestion Charge- costing £16 instead of £10 for driving into London, or £20 instead of £12 to pay the next day. However, paylondoncongestion.co.uk has declined to take any notice whatsoever of the ASA ruling.

The ASA told This is Money: “In 99 per cent of cases, advertisers comply immediately. But in this instance, Paylondoncongestion has not. We are disappointed. The website still does not make it clear that it is unofficial”. Unfortunately, many of the other tools at the ASA’s disposal do not hit scurrilous companies where it hurts- in the bottom line- with  ‘naming and shaming’ the firm or paying for ASA adverts to appear in internet searches alongside those of the scam website to warn potential users away, not likely to be as effective as a fine. The ASA do have redress to the Trading Standards Institute who can take statutory action and issue fines, but by that time, the tricksters are likely to have disappeared back into the woodwork.

But some claim that much of the problem could be easily solved by search engines. If scam websites didn’t appear above the official site, far fewer people would be tricked into spending more than they need to, or even losing money altogether- and some think the likes of Google should act.

Mike Walker googled “hmrc” to file his tax return. He clicked on the top result,  taxreturngateway.com, and realised too late that it was not the official government site. He told The Guardian:  ”It looked very similar, but it was only once I’d gone through the process of filing my return and made a payment of £400 that I realised it wasn’t the same.”

However, while the site has clearly paid for its premium position above the organic results, is it, or Google, breaking any laws? Taxreturngateway.com clearly states on its home page that “We are not connected to or affiliated with HMRC, DWP or any other official government body. We offer a bespoke, value for money, tax return assistance service for which we levy a charge.” They highlight that HMRC filing is free and even have a link back to the HMRC site. They claim they are providing a tax return completion service, for a fee, and it’s not their fault if people can’t read properly. Caveat emptor and all that jazz.

Google reportedly removed taxreturngateway.com from its advertising spots last month, but reinstated the site after investigating complaints.

So what do you think? Are people caught by these scams just victims of an online version of survival of the fittest or should someone somewhere take some action to stop them? Preferably with a few more teeth than the ASA.

Oh, and don’t forget to file your tax return online with HMRC by 31 January 2014.

whisky Cheaper whisky would make Scotland say no to independence?Gorgeous George has been in the news again recently, spouting off about further cuts to public service budgets and just how much the National Minimum Wage should increase (over the current £6.31 for those 21+). However, what he has remained tight-lipped about, is whether he has heeded pleas to adjust the duty on wines and spirits in a similar way to beer.

While January is never the best month to think about drinking, and with record numbers becoming charitable dryathletes, perhaps George could be forgiven for ignoring the recent campaigns. However, it seems that, owing to one particular tipple, the Treasury might consider making an exception.

Economic secretary Nicky Morgan stated that the government will ‘look at’ the duty escalator on spirits during a Westminster debate on how whisky sales in the UK have been squeezed by 12%  in the last five years because of high taxation- if the escalator escalates as planned, over 80% of a bottle will be duty. Which doesn’t leave much room for the alcohol.

While looking at is not necessarily the same as taking action, Ms Morgan said: “I can give an assurance that I will give this very serious consideration in the run up to the Budget, and I certainly will discuss it with my colleagues in the Treasury, including my right honourable friend the Chancellor of the Exchequer.”

Many are speculating that a Budget announcement of a cut in duty would be opportune, likely to come six months before a referendum on Scottish independence and that cheaper whisky could be just one of a number of  measures aimed at boosting Scotland and supporting the No campaign.

And it seems there is growing parliamentary support for cutting spirit duty, or possibly just whisky duty-  Chief Treasury Secretary Danny Alexander and Scottish Secretary Alistair Carmichael both have distilleries in their constituencies and have campaigned for fairer tax on whisky in the past. Alan Reid, Lib Dem MP for Argyll and Bute, said: “It is very unfair that whisky is taxed far higher than beer and wine. We must be about the only country in the world that taxes our own product higher than imported products like wine.”

So what do you think? Is a whisky-driven duty drop going to convince hard line separatists that Westminster isn’t so bad after all, or don’t you care what the Scots do, so long as your gin is a bit cheaper?

 

[Scotsman]

taxbill 300x180 HMRC reveal the stupid reasons for people not doing their tax returnsPeople give all manner of reasons for not handing a tax return in on-time, and HM Revenue & Customs has heard them all. And now, with a tax return deadline imminent, they thought they’d share the daftest reason for people’s tardiness.

Goldfish dying and woman too stunned after seeing a volcano go off on the news got onto the top ten of the most ‘bizarre and flimsy’ excuses and each one was met with a £100 fine from HMRC officials.

Others include a thespian from Coventry who said he was too busy touring the country with his one-man play while elsewhere, a taxi driver with a bad back would’ve done his return but he had a bad back and wasn’t able to clamber upstairs to get his tax return form. One corker was the man on a world cruise in his yacht who basically said they don’t have postboxes on the sea.

The best was a London accountant who told inspectors that he had been too busy submitting his clients’ tax returns to file his own.

HMRC’s head of personal tax, Ruth Owen, said: ‘There will always be unforeseen events that mean a taxpayer could not file their tax return on time. However, your pet goldfish passing away isn’t one of them.”

Fill out a self-assessment return for the 2012/13 tax year before the January 31st if you want to avoid a fine and if you’re struggling, have a look at www.hmrc.gov.uk/sa or call the self-assessment helpline on 0300 200 3310.

bitcoin 300x197 Like the look of Bitcoins? EU says youre stupidThe European Banking Authority (EBA) have followed the Banks of France and China in deciding to tell people that Bitcoins (and other virtual currencies) are a Very Bad Idea indeed, garnering no protection from the likes of the EBA in case of loss or theft. The EBA shook it’s head mournfully and said there was no protection or compensation for people whose “digital wallets” are hacked, a transfer of virtual money goes wrong or a platform is shut, as happens frequently as new currencies come and go.

While the EBA stopped just short of telling consumers straight out not to use online currency markets, it warned that customers who end up out of pocket won’t benefit from a banking safety net like the compensation given to deposit holders when a mainstream EU bank goes bust. Just like in Cyprus and Spain…

“Currently, no specific regulatory protections exist in the EU that would protect consumers from financial losses if a platform that exchanges or holds virtual currencies fails or goes out of business,” EBA said in a statement.

“Cases have been reported of consumers losing significant amounts of virtual currency, with little prospect of having it returned. Also, when using virtual currency for commercial transactions, consumers are not protected by any refund rights under EU law.”

There are about 100 virtual currencies, with new ones appearing every five minutes. Bitcoin is by far the best known and their value topped $1,000 (£1,630) last month. And we’ve all heard the tale of the bloke who chucked his Bitcoins not knowing their worth.

The EBA is currently considering whether it feels virtual currencies can or ought to be regulated. It could go so far as to to ban them, using its current powers, although whether this could actually be achieved in practice is another matter. Bitcoin sellers might just set up on street corners, hawking their products to impressionable young teens…

But for some, Bitcoins are a way to make (serious) money- someone who obtained Bitcoins while they were free, or at the cost of a few pennies, is now sitting on a sizeable nest egg. Not that the EBA can be happy for these people either- it warns that these people could be facing hefty tax bills.

The tax treatment of Bitcoins is as-yet undecided across Europe, with much of the debate surrounding whether the virtual currency is classed as a currency or a digital product or a voucher for cash. In the UK, currency is chargeable to capital gains tax, but exempt from VAT; if the Bitcoin is an intangible asset it is still chargeable to  capital gains tax on the profit, but not necessarily liable for VAT.

Last month, HMRC were on record as stating that Bitcoins are vouchers, not currency, and those who trade in them could be liable for 20% VAT; however, following representation from various bodies, and complaints by Bitcoins traders who threatened to move their Bitcoin trading offshore, HMRC have now apparently agreed that VAT probably isn’t due after all. But they might change their mind again. Your guess is as good as mine.