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Postponing the State Pension

Major changes to the rules governing the National Insurance Retirement
Pension come into force from 6 April 2010 - most people are aware, for example,
that pension age for women begins to rise. However, one lesser-known change
may be particularly important to people who have elected to defer their retirement
pension, or who are about to reach State Pension age and are considering deferring
their pension.
Shortly put, an individual may choose not to draw his pension immediately, in
which case he or she will receive a higher pension later, or may elect to receive a
(taxable) lump sum instead. For further details, see www.thepensionservice.gov.uk/
state-pension/deferral/what-are-my-choices.asp.
However, a new point to watch is that no adult dependency increase may be
claimed where a pension comes into payment on or after 6 April 2010. (Adult
dependency increases may be payable for a husband, wife or person looking after
children - the most common case is where a husband has reached retirement age
but his wife is not yet old enough to qualify for a pension of her own. For details see
www.thepensionservice.gov.uk/atozdetailed/adult-dependency-increase.asp.) Accordingly
anyone who defers his or her pension past 5 April 2010 will forego any
entitlement to a dependency increase.
Also, existing pensioners will not be able to make a new claim to an adult
dependency increase after 5 April 2010. However, existing claimants will be unaffected
until adult dependency increases are abolished altogether in April 2020.

Company Cars

Where an employer provides a company car, but the employee pays for the
fuel, the employer may pay a mileage allowance for business journeys. HMRC
accepts that payments not exceeding the 'advisory fuel rates' are reimbursements
of expenses, not subject to income tax or Class 1 National Insurance contributions.
The 'advisory fuel rates' (AFRs) are now reviewed every six months and on 1
June 2009 HMRC announced that the following rates would apply for journeys
taking place on or after Wednesday, 1 July 2009 (with employers being free to
implement the new rates earlier if they so wished).
The new rates are (old rates in italics):

Engine Size	Rate per mile
	Petrol *			Diesel			LPG
Up tp 1400cc	10p	10p		10p	11p		7p	7p
1401 to 2000cc	12p	12p		10p	11p		8p	9p
Over 2000cc	18p	17p		13p	14p		12p	12p

* Including petrol hybrid cars
These rates may also be used to reclaim input VAT in respect of fuel used for
business journeys (remembering that receipts to cover the amount reclaimed are
now required).
However, the 'advisory rates' may not be used where the employer does not
reimburse the cost of fuel used for business journeys and the employee wishes to
claim the cost as a deduction from his taxable employment income.
Where the employer pays for all the fuel used for both business and private
travel, the usual scale charge can be avoided if the employee is required to
reimburse the cost of fuel used for private journeys at the 'advisory rates' (unless,
exceptionally, the car used has an engine exceeding 3000cc).
The 'advisory fuel rates' scheme does not apply, in any circumstances, to
business or private travel in a company-owned van.
& For the detailed rules of the advisory fuel rates scheme, see www.hmrc.
gov.uk/cars/fuel_company_cars.htm.

Tax & Finance Deadlines for August

August 1 (Saturday): Due date for payment of corporation tax for accounting
periods ended 31 October 2008.
VAT - elections to revoke the option to tax may be made from today. For
details, see the article on the first two pages of this edition.

August 2 (Sunday): Forms P46(Car) for the quarter to 5 July 2009 should
reach HMRC by today. Note that it is no longer necessary to report changes of
vehicle (where an existing company car driver is allocated a new car).

August 3 (Monday): Statutory bank holiday in Scotland, but in practice the
banks will be open for business as usual. Some Government and other offices
may be closed.

August 7 (Friday): End of the week of grace, allowed by ESC B46, for the
receipt of CTSA Returns for accounting periods ended 31 July 2008.
Closing date for responses to HMRC's Consultation Document Modernising
Powers, Deterrents and Safeguards: Working with Tax Agents.

August 31 (Monday): Statutory bank holiday in England, Wales and Northern
Ireland. In practice, banks in Scotland will also be closed today.
CTSA Returns for accounting periods ended 31 August 2008 should reach
HMRC by today, but under ESC B46 a week of grace is allowed, making the
absolute deadline Monday, 7 September 2009.
Private companies with 31 October 2008 year-ends, and public companies
with 31 January 2009 year-ends, should file their accounts at Companies House by today.

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