Author: Glenn

The UK government has announced significant reforms to enhance compensation for customers affected by water service failures. Under new regulations, water companies will be mandated to increase compensation payments for issues such as supply interruptions, sewer flooding, and low water pressure.

These changes mark the first substantial update to compensation rates since 2000. For instance, compensation for internal sewer flooding will rise from £1,000 to £2,000 or more, and payments for low water pressure will increase from £25 to £250. Additionally, compensation will now be compulsory for incidents like boil water notices and missed meter services, which previously did not warrant mandatory payments.

Environment Secretary Steve Reed emphasized that these measures aim to hold water companies accountable and ensure that customers receive fair compensation when services fall short. He stated, "We are clear that the public deserve better compensation when things go wrong, so I'm taking action to make sure that happens."

Consumer advocacy groups have welcomed the reforms. Mike Keil, Chief Executive of the Consumer Council for Water (CCW), noted that the increased payment levels and expanded scope for compensation would incentivize water companies to improve their services. He remarked, "The overhaul of these standards marks a step forward in improving consumer protection and repairing fractured trust in the water sector."

These reforms are part of a broader government initiative to overhaul the water sector, which includes stronger regulations and potential criminal liability for water company executives. The legislation is expected to come into force next year, following a public consultation that showed overwhelming support for the changes.

In addition to the increased compensation, water companies have recently been fined £157.6 million for failing to meet pollution targets, reflecting the government's commitment to enforcing higher standards in the industry.

Overall, these measures represent a significant step towards improving accountability and service quality within the UK's water sector, ensuring that customers are better compensated when things go wrong.

A restaurant in Middlesborough recently challenged a civil penalty notice of £15,000 issued by the Secretary of State for the Home Department under Section 15 of the Immigration Asylum and Nationality Act 2006 (IANA 2006) arguing that their employee was lawfully present in the UK and that they were not given the opportunity to mitigate the penalty.

However, the Court emphasised that the 2006 Act's purpose was to discourage illegal employment and that employers are responsible for conducting any necessary checks on employees' right to work, according to Section 15(3).

This judgement highlights the importance of employers carrying out right-to-work checks to avoid finding themselves in a similar situation. Ensure your employees have the right to work by using an identity service provider offering Identity Document Validation Technology (IDVT).

Could you save up to £1,260 in tax this year? If one of you earns less than £12,570, the Marriage Allowance lets couples transfer unused personal allowances. Don't miss out on this easy tax break!

The Marriage Allowance applies to married couples and civil partners where one partner does not pay tax or does not pay tax above the basic rate threshold for Income Tax (i.e., one partner must earn less than the £12,570 personal allowance for 2024-25).

The allowance allows the lower-earning partner to transfer up to £1,260 of their unused personal tax-free allowance to their spouse or civil partner. The transfer can only be made if the recipient (the higher-earning partner) is taxed at the basic 20% rate, which typically means they have an income between £12,571 and £50,270 for the 2023-24 tax year. For those living in Scotland, this would usually apply to an income between £12,571 and £43,662.

By using the allowance, the lower-earning partner can transfer up to £1,260 of their unused personal allowance, which could result in an annual tax saving of up to £252 for the recipient (20% of £1,260).

If you meet the eligibility criteria and have not yet claimed the allowance, you can backdate your claim to qualifying tax years for up to four years starting from 6 April 2020. This could provide a total tax saving of up to £1,260 for the tax years 2020-21, 2021-22, 2022-23, 2023-24, and the current 2024-25 tax year. If you apply now, you can backdate your claim, as well as for the current year. Applications for the allowance can be submitted online at GOV.UK.

Married couples and civil partners may be able to pass on up to £1 million of their estate tax-free with the Residence Nil Rate Band. Claiming this transferable allowance could secure your family home for future generations. Make sure your estate planning takes this into account.

The Residence Nil Rate Band (RNRB) for Inheritance Tax is a transferable allowance available to married couples and civil partners when their main residence is inherited by direct descendants, such as children or grandchildren, after their death.

Currently, the maximum RNRB allowance is £175,000 per person, and it can be transferred to a surviving spouse or partner if unused. This is in addition to the existing £325,000 Inheritance Tax (IHT) nil-rate band. Together with the IHT limit, this allows married couples and civil partners to pass on property valued up to £1 million free of IHT to their direct descendants.

The RNRB is subject to tapering for estates valued over £2 million, even if the family home is left to direct descendants. For every £2 the estate exceeds the £2 million threshold, the additional allowance is reduced by £1. This means that, for large estates, the full amount of the RNRB could be entirely tapered away. This means that for estates valued over £2,350,000 for individuals or £2,700,000 for married couples, the RNRB would be reduced to nil.

The transfer of any unused RNRB does not occur automatically; it must be claimed from HMRC when the surviving spouse or civil partner passes away. Typically, the estate's executor will file the claim to transfer the unused RNRB from the estate of the first deceased spouse or civil partner. This transfer can also be made if the first spouse or civil partner died before the RNRB was introduced on 6 April 2017.

Scammers are on the rise as the Self-Assessment deadline nears! HMRC warns that HMRC never emails or texts about tax refunds. Stay alert, report suspicious contacts, and protect your money from fraudsters.

Fraudsters are increasingly targeting taxpayers with scam emails as the deadline for submitting self-assessment returns for the 2023-24 tax year approaches. Between November 2023 and October 2024, HMRC received over 144,000 reports of suspicious contact, nearly 72,000 of which involved fake tax rebate claims. There has been a significant rise in scam emails compared to the previous year.

These scams often claim that taxpayers are entitled to a rebate or refund from HMRC and request bank or credit card details to process the non-existent refund. Fraudsters use various methods, including phone calls, text messages, and emails, and may even threaten victims with arrest or imprisonment if a fabricated tax bill is not paid immediately.

HMRC works to identify and shut down scams but continues to urge taxpayers to be vigilant and avoid falling victim. Remember, HMRC only contacts individuals due a refund by post—never via email, phone, text, or third-party companies. Legitimate organizations like HMRC and banks will never ask for your PIN, password, or bank details.

If you receive a suspicious email claiming to be from HMRC, forward it to phishing@hmrc.gov.uk. For suspicious texts, text 60599, and for fraudulent calls, report them via GOV.UK. If you have lost money, contact Action Fraud at 0300 123 2040 or report online. In Scotland, contact the Police on 101.

HMRC’s Chief Security Officer at HMRC, said:

'With millions of people filing their Self-Assessment return before January’s deadline, we’re warning everyone to be wary of emails promising tax refunds.

Being vigilant helps you spot potential scams. And reporting anything suspicious helps us stop criminal activity and to protect you and others who could have received similar bogus communication.

Our advice remains unchanged. Don’t rush into anything, take your time and check ‘HMRC scams advice’ on GOV.UK.'