HMRC tax refund
HMRC has announced that employers who have provided benefits in kind that have been used by employees for both private and business use may be entitled to a refund of Class 1A NICs for the tax years 2003-04 to 2005-06. This follows HMRC's decision not to appeal the judgment of the First-tier Tribunal in Antique Buildings Ltd v HMRC [2010] UKFTT 97 (TC). HMRC now accepts that, for tax years 2003-04 to 2005-06, partial income tax deductions under sections 363 to 365 of ITEPA 2003 are to be taken into account when computing Class 1A NICs liability under section 10 of SSCBA 1992. HMRC states that refund claims for the tax years in question should generally be made no later than 5 April of 2011, 2012 and 2013 respectively.
Businesses should therefore get any claims for refunds relating to the tax year 2003-4 in now before the new tax year starts.