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Fraudulent communications from ‘HMRC’
HMRC is warning of a number of new email phishing scams. Phishing emails are used by fraudsters to access recipients’ valuable personal details, such as usernames and passwords. Whilst these messages may appear to be genuine they are very dangerous and clicking on a link from within the email can result in personal information being compromised and the possibility of computer viruses affecting your computer or smartphone.
HMRC is currently sending out VAT EU refund emails to taxpayers whose claims have failed validation. These emails are genuine and will not ask for any personal or financial information. Only taxpayers who have tried to submit a refund claim should be receiving these emails.
HMRC is also sending letters to tax credit recipients asking them to take part in a short telephone survey. These letters are genuine and the calls will be made until 9 December 2016. The letters contain a link to the HMRC contacts page if taxpayers wish to verify the invitation.
If you are unsure as to the validity of any email or communication from HMRC it should not be opened until the sender can be verified. HMRC has reiterated many times that they do not send notifications of tax rebates by email nor do they ask recipients to disclose personal or payment information by email.
Help to Save scheme
An HMRC consultation paper on the launch of the new Help to Save scheme closed in July 2016. A response to the consultation providing more information on the scheme has been published. The government received 31 formal responses. Most respondents were broadly in favour of the scheme. These responses have now been analysed and the primary legislation necessary to introduce the scheme has been introduced to Parliament.
The new scheme will allow anyone in work and in receipt of Universal Credit or Working Tax Credits to save up to £50 a month and receive a 50% bonus after 2 years that can be worth up to £600. The scheme is expected to be in place by April 2018.
Account holders will then be able to continue saving under the scheme for a further 2 years and receive another £600 bonus. This roll-over will take place automatically. This could see those on low incomes receive a bonus of up to £1,200 over 4 years. After the 4 years have expired account balances will be rolled over into successor accounts.
The new scheme will be open to all adults in receipt of Universal Credit with minimum household earnings equivalent to 16 hours at the National Living Wage or those in receipt of Working Tax Credits. The Help to Save scheme could help an estimated 3.5 million people across the UK to save for the future. It has also been confirmed that the National Savings and Investments bank (NS&I) will be the sole provider of the accounts across the UK.
Secondary annuities market
Late last year, the government announced that a new secondary annuity market would be created by April 2017. However, after an extensive period of research, it has been decided to cancel these plans. The government was concerned that the consumer protections required would make it difficult to establish a secondary annuities market and that the fees to cash in an existing annuity would have been too high.
The introduction of new freedoms to sell annuities would have benefited more than five million people who own an annuity as well as anyone who purchases an annuity in the future. There are likely to be many disappointed pensioners and campaigners who had hoped for these changes to be put in place. This will especially affect those who retired before the new pension freedom measures came into effect in April 2015 and had little choice but to purchase a pensions annuity product.
Announcing the change in policy, the Economic Secretary to the Treasury, Simon Kirby, said:
'It has become clear that we cannot guarantee consumers will get good value for money in a market that is likely to be small and limited. Pursuing this policy in these circumstances would put consumers at risk – this is something that I am not prepared to do.
The government has always been clear that for the majority of people keeping their annuity incomes will be their best option, estimating that only 5% of people who currently hold an annuity would take advantage of this reform.'