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Regulatory Changes For April 2008 March 31, 2008

Posted by liverpoolchamber in Legislation, Policy.
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The government has recently introduced a common commencement date for new legislation.  Most legislation is now introduced twice yearly, in April and October.

Listed below are some of the new legislation updates coming into effect from April 6 2008. They include changes to Corporation Tax, Capital Gains Tax and the Annual Investment Allowance.

Click ‘more’ for the full list.

Corporation Tax
Corporation tax will fall from 30% to 28%, whilst the small company rate will increase from 20% to 21%.

Capital Gains Tax
A new flat rate of 18% will be introduced.  Under the new Entrepreneurs Relief Rate businesses owners will pay a rate of 10% on the first £1 million of their capital gains.

Empty Property Relief Rates
The reforms will apply the full business rate to business properties which have been empty for more than three months, and to industrial premises which have been empty for more than six months.

Previously, empty warehouses and industrial premises received 100% relief from business rates, whilst empty retail and office spaces received 100% relief for the first three months, and then 50% relief.

Charities and community amateur sports clubs will be exempt from paying businesses rates on any empty property they own.

Information and Consultation of Employees
Employees of companies with more than 50 employees will have the right to be consulted and informed regularly on issues in the organisation.  These regulations were previously applied to companies with more than 150 employees in April 2005, and to companies with more than 100 employees in April 2007.

Employers will be required to consult with employees if more than 10% of employees make a formal, written and dated request.  However, the 10% requirement has a 15 person minimum and 2,500 maximum.  Following this request, the employer has 3 months in which to negotiate an agreement which should cover:

  • the circumstances in which consultation and information is required
  • the type of consultation – whether by elected employees representatives, directly with the employees or both
  • all employees within the organisation

It should be written, signed and dates, and approved by the employees.

Possible new areas of consultation include: organisational structure, business objectives, staff policies, performance, and future plans and prospects.

Companies should be aware that legislation also exists requiring consultation on issues of Health and Safety, contractual changes, cases where there will be more than 20 redundancies, undertakings and transfers, and changes to pension arrangements.

While all this may seem a little daunting, there is a lot of guidance available on organising consultations from Business Link and ACAS.  More detailed information and guidance on the requirements is available from BERR.

Annual Investment Allowance
Changes have been made to relief given to business investment.  From April, expenditure up to £500,000 will have 100% tax relief in the first year of expenditure.

Energy Performance Certificate
EPCs are being introduced in April for the construction, sale or rent of non-dwellings with a floor space of more than 10,000m2, in July 2008 for non-dwelling with a floor space of more than 2,500m2, and in October 2008 for all non-dwellings.

EPCs will give the building an energy rating, with the most efficient rated as A, though to the least efficient rated as G.  A Recommendation Report will also be included with the certificate which will detail cost-effective building alternations, as well as measures that will require a higher level of expenditure.

The definition of ‘construction’ includes alterations to the number of units, and changes include modification or extension of fixed services for heating, hot water, air conditioning or mechanical ventilation.

Very few buildings are exempt.  These include places of worship, temporary buildings (less than two years), industrial premises, workshops and agricultural buildings with a low energy demand, and stand alone buildings with a floor space of less than 50m2.

EPC must be given free of charge to the buyer or tenant, and can only be prepared by an accredited assessor.

Companies Act
There have also been a number of changes to the Companies Act 2006.

Companies are no longer required to appoint a company secretary, although they may if desired.  Documents may now be executed by a single director in the presence of a witness.  The requirement for private companies to lay their accounts before an AGM has been removed.

The time limit for filing of account has been reduced to within 9 months of the end of the year for private companies, and within 6 months of the end of the year for public companies.

Other changes include changes in the form and contents of accounts, insurance undertakings, and changes to the way companies provide financial summary statements.  The thresholds defining small and medium sized companies have also been increased.  Under new audit regulations, companies will have to include on their accounts how much auditors earn from them for other services, and whether they have a liability limitation agreement.  A full list is available from the BERR website.

Further information on regulatory changes is available at Business Link.


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