Benefits in kind: de minimis

Subscribers will recall that HMRC held a consultation on the proposed abolition of the £8,500 de minimis salary limit on benefits in kind – which threatened to cause serious administrative problems for charities that employ volunteers on low incomes.

The consultation ended on 17 March. HMRC has now responded, as follows:

HMRC believes that there has been a constructive dialogue on the subject of payrolling. Over the next few months we will be considering the responses received in detail and will provide a further update at the Pre Budget Report.

Although the consultation predominantly focused on the administrative benefits of putting benefits in kind and expense payments through the payroll, HMRC also sought views on the impact of the £8,500 threshold, above which tax is payable on benefits in kind.

The responses to the consultation indicate that the removal of the £8,500 threshold, would have an adverse impact on low paid employees and possibly the voluntary sector. The Government has therefore confirmed that it will retain the £8,500 threshold.

Source:
HM Revenue and Customs: What's New   (18/04/2008)

Date: 21/04/2008 (Posted: 21/04/2008)

Compact

The Compact Action Plan was prepared for the Compact Annual Meeting on in December 2007 has now been published. The plan sets out the priorities for progressing the partnership between government and the voluntary and community sector (and parts of the wider third sector) through the Compact.

Source:
HC Deb: c 98 WS   (21/04/2008)

Date: 24/04/2008 (Posted: 24/04/2008)

Parliament, the voluntary sector and water

On Thursday 17 April the Scottish Parliament debated a Labour motion on Support for the Voluntary Sector. As well as praising the work of the sector, the Labour motion raised the issues of feared local authority budget cuts and a call for restored funding for Project Scotland, which promotes youth volunteering. The Resolution agreed to by the Parliament, by 80 votes to 47, called specifically for the extension of the current exemption from water rates:

That the Parliament applauds the vital contribution made to society and the economy by the third sector; believes that co-operation between the third sector, local authorities and the Scottish Government is vital in ensuring a strong role for the third sector; recognises that the Scottish Government is funding Project Scotland and has made clear to Project Scotland that further resources may be available for projects it runs in terms of the Scottish Government's employability agenda, and believes that the exemption from payment of water rates extended by the previous administration to 2010 should be further extended; calls on the Scottish Government to work with the third sector to reduce the burden of regulation affecting the sector; recognises the problems facing the voluntary sector caused by short-term funding and re-tendering; believes that there is a pressing need to review the system to provide more stable funding for the sector including longer-term contracts and a national contracts framework; notes the establishment of the voluntary sector compact under the last administration and calls for a revitalised compact between local government and the voluntary sector; believes that this compact must ensure greater dialogue between councils and voluntary groups as to the operation of the local government Concordat and the single outcome agreements, and calls for a review of the operation of the Concordat including its key outcomes and performance indicators following the first year of its implementation.

The amendment on water rates was inserted on the proposal of Jim Mather, Minister for Enterprise, Energy and Tourism, so presumably represents the policy of the Scottish Government. When we enquired after further detail, the Scottish Government referred to the consultation on the Principles of Water Charging for 2010–014 and said that a strong case for retaining exemptions had been made by the voluntary sector and church groups. We agree this is a principle that should be supported and we will set out our response in full in due course when we publish the analysis and our response to the consultation.

Source:
Scottish Parliament: Official Report   (17/04/2008)

Date: 24/04/2008 (Posted: 24/04/2008)