HMRC to require more information from Tax Payers
Draft legislation released for consultation on 18 July indicates that business and individual taxpayers will be required to provide more information to HMRC in the next few years.
It is proposed that from 2025/26, employers will be required to provide more detailed information on employee hours worked via real time information (RTI) PAYE reporting. The information to be reported will be set out in separate regulations.
From 2025/26 shareholders in owner-managed businesses will also be required to provide additional information via their self- assessment tax returns. These shareholders will be required to disclose the amount of dividends received from their own companies separately from other dividend income, as well as the percentage shareholding that they hold in their own companies.
Self-employed individuals will be required to provide information on the start and end dates of their businesses via their self-assessment returns.
Income Tax on Inherited Pension Funds
Currently, where an individual pension holder dies before age 75, drawdown pensions paid to a successor can generally be received free from income tax. Where the pension holder dies over the age of 75, then the amounts drawn by the successor are taxed at their marginal income tax rate. Note also that the current tax rules provide that the value of the fund passes free of inheritance tax to the successor and thus forms an important part of estate planning.
Policy documents published in July 2023 include draft legislation to abolish the pension lifetime allowance and associated income tax charge. These were previously announced as part of Budget Day measures to lure workers aged over 50 back into work and are generally welcomed. However, the policy documents regarding changes to the taxation of pensions also included a suggestion that certain beneficiaries of pensions of members who died under age 75 may become subject to income tax as part of future tax changes, possibly from 2024/25. This would align with the tax position for beneficiaries of pensions where the member dies over age 75.
Advisory Fuel Rates for Company Cars
The table below sets out the HMRC advisory fuel rates from 1 September 2023. These are the suggested reimbursement rates for employees’ private mileage using their company car.
Where the employer does not pay for any fuel for the company car these are the amounts that can be reimbursed in respect of business journeys without the amount being taxable on the employee.
| Engine Size | Petrol | Diesel | LPG |
| 1400cc or less | 13p | 10p | |
| 1600cc or less | 12p | ||
| 1401cc to 2000cc | 16p(15p) | 12p | |
| 1601 to 2000cc | 14p | ||
| Over 2000cc | 25p(23p) | 19p(18p) | 19p(18p) |
Where there has been a change the previous rate is shown in brackets. You can also continue to use the previous rates for up to 1 month from the date the new rates apply.
Note that for hybrid cars you must use the petrol or diesel rate. For fully electric vehicles the rate is 10p (9p) per mile.
