I REALLY AM SELF-EMPLOYED!

The Federation of Small Businesses (FSB) has estimated that as unemployment rises, as many as 300,000 thousand people are predicted to start up their own micro-businesses this year.

However, the FSB are concerned that HM Revenue and Customs will try to force those who do opt for self-employment to switch their legal status from selfemployed to employee if they work for other companies on a contracted basis for any length of time.
John Walker, the FSB's national chairman, said: "Those who do become self-employed need to beware of the tax man who, when they work for other companies, is putting them in the PAYE bucket and turning their legal status from self-employed to an employee. The FSB is calling on HMRC to respect peoples wishes to be self-employed." Currently HMRC must check within a six-month timeframe to determine whether the entrepreneur meets the criteria for self-employment, and once their self-employed status has been accepted the applicant must be considered as self-employed unless a material change has taken place. A HMRC spokesman said: "HMRC does not discriminate between different types of taxpayer and fully respects the right to be regarded as selfemployed so long as this is supported by the facts.

HOLIDAY HOMES BENEFIT FROM TRIBUNAL DECISION ON VAT RULES

Under the DIY housebuilders scheme when private individuals build their own new dwellings they are able to claim VAT on the goods they buy for the purpose. Furthermore those converting nonresidential buildings into dwellings can also claim the VAT on goods and conversion services. Following a VAT Tribunal HMRC now accept that the scheme should also apply to dwellings individuals acquire as holiday homes, provided the person acquiring or converting will not hire it out to third parties.
As a result HMRC are now inviting retrospective claims from private individuals who have constructed new holiday homes or converted non-residential buildings into holiday homes, for non-business use, where the certificate of completion was issued on or after 15 March 2006. Where claims have already been made for holiday homes, but been refused, they may be resubmitted on the original form.

SAVERS ARE BEING KEPT IN THE DARK

Consumer group Which? Has claimed that many banks and building societies are not keeping savers properly informed about changes to the interest rates on their accounts. According to Which’s study, only a 1/3rd of the banks and building societies investigated during the research told customers personally, either by letter or by email, that the rates on their savings accounts were being reduced. Other banks only guarantee a personal notification if rates are cut by more than 0.25 per cent or if a series of smaller cuts culminate in a reduction of more than 0.5 per cent over the course of a year. It could be argued that customers are being penalised by such policies. For example customers who bank online will miss out on branch announcements, while others may not see the relevant newspaper announcements. Even small rate cuts could be proportionately very large with Bank of England interest rates held at 0.5 per cent.

Banking rules state that providers have no obligation to tell customers if their rate changes by less than any movement in the Bank of England's base rate.

STILL WAITING FOR YOUR TAX REPAYMENT?

A review by the National Audit Office (NAO) has found that HM Revenue and Customs (HMRC) is facing a backlog of some 18 million tax cases. The NAO report which covered the 2009-10 financial year and noted an improvement in tax debt collection, with the amount outstanding falling by £1.6 billion to £26.1 billion. The amount of overpaid tax for last year could total as much as £3 billion, while underpaid tax could be £1.4 billion. Although conceding that more needed to be done to clear the backlog, HMRC pointed to a reduction in its budget.