Businesses that failed to pay staff the national minimum wage have been forced to pay back more than £2 million in unpaid salary.
In addition to paying workers back money they owed, 233 employers on the government's 'named and shamed' list were fined £1.9 million.
The national living wage is currently £7.50 an hour for employees over the age of 25, and £7.05 an hour for those aged between 21 and 24.
The Department for Business, Energy and Industrial Strategy said retail, hairdressing and hospitality businesses were among the worst offenders.
Common errors made by businesses include:

• deducting money from salary to pay for uniforms
• failure to account for overtime hours
• wrongly paying apprentice rates (£3.50 an hour for under-19s or those in their first year) to workers.

Margot James, business minister, said:
"It is against the law to pay workers less than legal minimum wage rates, short-changing ordinary working people and undercutting honest employers.
"Today's naming round identifies a record £2 million of back pay for workers and sends the clear message to employers that the government will come down hard on those who break the law."
Melissa Tatton, director at HMRC, added:
"HMRC is committed to getting money back into the pockets of underpaid workers, and continues to crack down on employers who ignore the law.
"Those not paying workers the National Minimum or Living Wage can expect to face the consequences."
Contact us to discuss your payroll issues.

Originally announced in the 2016 Budget, the 2016 Autumn Statement confirmed that Class 2 National Insurance Contributions (NICs) will be abolished from April 2018, hopefully achieving the desired effect of simplifying National Insurance for the self-employed and making the system fairer for employed and self-employed individuals.
At the same time as the abolition of Class 2 NICs, the system for Class 4 NICs will be reformed to include a new threshold – to be called the ‘small profits limit’ (SPL). The amount of the SPL for 2018/19 is yet to be confirmed but is likely to be around £6,025.
Payment of Class 2 NICs by the self-employed – a standard weekly contribution of £2.80 per week in 2016/17, rising to £2.85 per week from April 2017 – gives eligible individuals access to certain contributory benefits such as contribution-based employment and support allowance, basic state pension and bereavement benefits.
Class 4 NICs are paid by the self-employed on profits above the annual ‘lower profits limit’ (LPL). For 2016/17, contributions are payable at the rate of 9% on profits between the LPL of £8,060  and  the ‘upper profits limit’ (UPL) of £43,000. Contributions are then paid at the rate of 2% on profits above the UPL. For 2017/18 the LPL will be £8,164 and the UPL will be £45,000.
After abolition of Class 2 NICs from April 2018, those with profits between the SPL and the LPL will not be liable to pay Class 4 contributions but will be treated as if they have paid Class 4 contributions for the purposes of gaining access to certain contributory benefits. Those with profits at or above the Class 4 LPL will gain access to the new state pension, contributory employment and support allowance (ESA) and bereavement benefit. Those with profits above the LPL will continue to pay Class 4 contributions.
The special arrangements that currently apply to share fishermen and volunteer development workers that allow them to pay special rates of Class 2 NICs to gain access to a wider range of benefits than currently available through Class 2, will also be abolished from April 2018. Transitional provisions will apply.
Class 3 contributions, which can be paid voluntarily to protect entitlement to the state pension and bereavement benefit, will be expanded from April 2018 to give access to the standard rate of Maternity Allowance (MA) and contributory ESA for the self-employed. Rates of Class 3 NICs are £14.10 per week for 2016/17 rising to £14.25 in 2017/18.
Concerns over these changes have been expressed within the tax profession. Anthony Thomas, Chairman of the Low Incomes Tax Reform Group (LITRG) said that some parts of these proposals are good news for self-employed workers on low earnings, but by no means all. Those with profits between the Class 2 exemption limit (currently £5,965) and the Class 4 LPL (currently £8,060) will be better off because they will pay no NI but be credited with contributions. The Group’s concern is for those with earnings lower than £5,965 who would have to pay voluntary Class 3 contributions in the future to protect their benefits entitlement if they did not obtain NI credits through receipt of other benefits, for example tax credits, child benefit or Universal Credit. Class 3 contributions will cost almost five times the amount they are paying now (£14.10 per week compared to £2.85 per week) and may mean the cost is unaffordable, leading them to rely more on means-tested benefits in the future.

The Federation of Small Businesses (FSB) is calling for local authorities in England to become more accountable and transparent when it comes to economic growth and business support.
A survey on 1,801 small business owners found the majority (70%) support the idea of giving more powers to local authorities, while 64% believe devolution deals were good for their business.
However, only 15% have been consulted on the devolution process in their area, suggesting most businesses are generally being excluded.
57% felt they couldn’t contribute to ongoing decision making and 53% said there were no means to hold locally-elected bodies to account.
Mike Cherry, national chairman at FSB, said:
“The success of devolution deals will hinge on effective collaboration between new and existing local leaders. 
“Combined authorities must clearly demonstrate how they are promoting growth and establish channels through which they can be held accountable. 
“With new devolution proposals in the pipeline, future deals must be established on the basis of need.”
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​A public consultation has been launched by the European Commission (EC) to improve VAT for cross-border e-commerce transactions in the European Union (EU).

The consultation aims to seek advice from business owners and representative parties ahead of legislative proposals aimed at the digital single market next year.

The Commission are aiming to collect feedback on Mini-One Stop Shop (MOSS), which was implemented to help businesses sell digital services in multiple EU states will still declaring and paying VAT in their home country.

The consultation will seek advice from businesses and other representative parties on:
·         the current VAT rules for cross-border supplies of goods and services
·         implementation of this year’s VAT changes of supply rules and MOSS
·         extend MOSS and payment mechanisms to intra-EU and online sales for tangible goods.

Simplification measures for smaller businesses will be introduced, including an appropriate threshold which can address problems without causing effect to the single market or compliance challenges for tax administrations.

Andrus Ansip, European Commission Vice-President for the Digital Single Market, said:
"We promised to support companies, and especially smaller ones, to reduce burdens arising from different VAT regimes. Today we ask businesses and other stakeholders to help find the most effective and meaningful ways of delivering on this promise. In the Digital Single Market Strategy we have already put forward some measures we would like to take, such as a VAT threshold for startups."
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Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs said:
 "This consultation presents a real opportunity to ensure that future VAT revenues from the digital economy are distributed fairly and effectively. At the same time, we want to make it as easy as possible to comply with the rules. We also have an interest in ensuring that future legislation reflects the reality for businesses across the EU.”

The internet has enabled many small businesses to sell internationally, but exporting goods and services can create VAT difficulties. 

For VAT purposes you need to know whether you are selling goods (physical things), or services (something you cannot physically touch 
eg: downloaded software), as the rules vary for goods as opposed to services. You also need to know where your customer is based - 
in an EU country or elsewhere and whether the customer is a VAT registered business. 

When you sell goods to other businesses in the EU or in other countries you can normally charge the zero-rate of VAT on the sale. 
This means you can recover VAT on any related input costs. However, you need to show that your customer was VAT registered
and the goods physically left the UK. Getting the paperwork right is essential. 

The rules for international services are more complicated as they depend on the place of supply of the service, 
which varies according to the type of service supplied and who it is supplied to (business or non-business customer).
UK businesses selling to private customers in other EU countries must charge UK VAT. Where the customer is a business in another EU country, 
in most cases the customer accounts for the VAT in their own country, so the UK supplier does not charge VAT and the reverse charge procedure applies. 

Whether you sell goods or services to VAT-registered businesses within the EU you must complete an EC sales list (ESL). 
If you only supply services, or your total goods and services sales do not exceed £35,000 per quarter,
you may submit the ESL every quarter, otherwise you must submit monthly ESLs. Certain low-volume exporters can apply to the Taxman 
for permission to submit annual ESLs.

The ESL can be submitted in paper form on VAT 101, or online through the HMRC website, but it must contain the following details:

• your customer's name;
• the relevant country code for each customer; and
• the value of the goods and/or services supplied.

We can complete the ESL on your behalf, just like your normal VAT return.
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