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Highlights from the broader tax news for the week ending 24 January 2024, including: time to pay arrangements; preparing for changes on moving goods from Ireland to Great Britain; HMRC research on VAT penalty reform; insolvency guidance on operating PAYE; and updates to the process for applying for probate.

Agreeing a payment plan with HMRC

HMRC has reminded taxpayers who are unable to pay their tax bill in full by 31 January 2024 that they can set up a monthly payment plan (time to pay). If the person owes less than £30,000 and has no other payment plans or outstanding debts to HMRC, they may be able to set up the payment plan online. Interest will be applied to any outstanding balances from 1 February. However, late payment penalties can be avoided by agreeing a time to pay arrangement with HMRC within 30 days of the deadline

Prepare for changes for goods moving from Ireland to Great Britain

From 31 January 2024, some goods will face full customs controls when moving directly to Great Britain from ports in Ireland. More information on what businesses should do to prepare can be found here. Businesses moving goods to Great Britain from or through Northern Ireland should read this HMRC guidance.

VAT penalty reform research

HMRC has announced that it is working with an independent research agency, Verian, to research the views of VAT-registered businesses on the changes in the VAT penalty regime. Verian will be contacting selected VAT-registered businesses by letter or email between 22 January and 25 March 2024 to invite them to take part in an interview. Businesses may be contacted even if they have never received a VAT penalty.

Tax returns and payments in administrations

HMRC has published guidance on the process for calculating, reporting and paying tax liabilities that arise during the period of administration as a result of an administrator's actions. The guidance confirms that the company’s existing PAYE scheme should continue to be used for post-appointment payments to employees.

Recording tax and NIC for former employees of an insolvent entity

Guidance published by HMRC states that where income tax and national insurance contributions (NIC) are due on payments made to the former employees of an insolvent entity, a new Employment Protection Act (EPA) PAYE scheme should be set up. The guidance explains the process for setting up an EPA PAYE scheme and the information that will be required.

Update to inheritance tax and probate process

HMRC and HM Courts and Tribunal Service (HMCTS) have updated the process for applying for probate.

The IHT400 form has been updated and is available to download on gov.uk.

Personal representatives applying for probate in England and Wales will no longer need to complete an IHT421 (probate summary) form. Instead, once HMRC has received and processed the IHT400 (inheritance tax account), it will issue a letter containing a unique code and the details of the estate values. The code and estate values should be used when applying for probate through the HMCTS online portal.

The process for applying for probate remains the same in Northern Ireland and Scotland. The IHT421 form for use in Northern Ireland has been updated.

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