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Financial: Taxation

5th February 1998
Page 34
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Page 34, 5th February 1998 — Financial: Taxation
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Which of the following most accurately describes the problem?

Self-assessment

▪ The long-awaited self-assessment e4Ir system for companies is being introduced for accounting periods ending on or after 1 July 1999. This means that no companies will enter self-assessment until 2 July at the earliest

The further legislation needed to introduce self-assessment for companies will be included in the next Finance Bill.

Corporation tax

The Inland Revenue is consulting on the introduction of quarterly payments of corporation tax for large and medium-sized companies (the latter will only pay half their corporation tax by this method)*. The new system will be phased in over four years from 1 July 1999.

From 6 April 1999 the main rate of corporation tax is to be cut by 1% to 30%.

A Modern System for Corporation Tax Payments costs £4 from the Inland Revenue Reference Library, Ground Floor, South West Wing, Bush House, Strand, London WC2B 4RD. It is also available on the Internet at: http://www.open.govuk/inrev/condoc7.htm.

Travel expenses

The Inland Revenue has published guidance on the tax and NIC rules on travel expenses which come into effect on 6 April.

• Employee Travel—A Tax and 1VICs Guide for Employers: if you have not received a copy by the end of the month, contact your local Inland Revenue tax office.

• 1R161—Tax Relief for Employees' Business Travel: available free from all tax offices.

Termination A consultative document has been issued by the Inland Revenue detailing proposed changes to the law on taxation of employment termination settlements. Legislation on this subject is expected in the next Finance Bill.

It is proposed that payments and benefits will only be taxed when they are received or enjoyed, and are taxable for that year, rather than being treated as income in the year of termination.

Copies of Continuing Benefits and Payments Provided Under Employment Termination Settlements cost £3 from the Inland Revenue Reference Library, Ground Floor, South West Wing, Bush House, Strand, London WC2B 4RD.

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