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The government's plans to force businesses to undertake quarterly reporting have received a blow this week. The success of an accountant's petition opposing the proposals has prompted a debate in parliament.
Meanwhile HMRC's problems continue with the retirement of chief executive Lin Homer who has overseen a period of deteriorating customer service and criticism from the Public Accounts Committee.
We focus on small companies this week, with a round-up of recent and upcoming changes together with tax planning issues for directors to consider as the year end approaches. Also we take a look at the controversial new proposals to block capital treatment for certain close company distributions.
VAT and land and property is a complex area of tax. We have been further updating our new guides on this topic.
Finally, we have reviewed the draft guidance for the new, confusingly acronymed, register for Persons with Significant Influence and Control "PSC" which all companies and LLPs are required to maintain from 6 April this year. The PSC Register is not to be mistaken for any new obligation for Personal Service Companies (also "PSC"s).
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Nichola Ross Martin FCA Tax Director
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Quick News
Government to debate quarterly reporting plans
The government has announced that it will now debate quarterly reporting as the petition "Scrap plans forcing self employed & small business to do 4 tax returns yearly" reaches the required 100,000 signatures.
Lin Homer resigns
HMRC's chief executive, Lin Homer, has announced that she is leaving her post.
List 3 updated
HMRC's List 3 which lists the professional bodies and learned societies with tax-deductible fees, has been updated.
Case Update: employee tax
Can "client relationship and connections" be a transferable asset when you change job?
In HMRC v Smith & Williamson Corporate Services and Patrick Smiley UKUT [2015], a payment received by a new employee from a third party in respect of his client connections was held to be employment income and not a capital payment in respect of any transfer of goodwill.
Practical Tax Guides & Updates - for subscribers
VAT: Land & Property (notes)
NEW: a guide to the VAT treatment of land & property transactions to accompany our existing At a Glance VAT guide.
Land & Property: Adviser's update Dec/Jan 2016
UPDATE: a handy summary listing all of the many changes and proposals with links to our more detailed guides on each topic.
Negligible Value Claims
UPDATE: consider backdating claims to make use of losses in an earlier year.
Editor's choice: Small Companies & Directors
Small Company Tax: What's new
Plan ahead with our guide to the latest changes and proposals for 2016/17 affecting small company taxation.
Company distributions: new measures
We published this before Christmas, it's here again as it's worth a read. A new consultation seeks to extend the Transactions in Securities provisions in order to block the extraction of close company funds as capital. The proposals are controversial as they may affect planning undertaken for purely commercial reasons.
Register of persons with significant control
NEW: All companies and LLPs will be required to maintain a publically available register of persons with significant control from 6 April 2016. We review the recently issued draft guidance.
Director's planning toolkit 2015/16
UPDATE: Our annual tax planning checklist for directors. Updated to include reference to changes proposed for 2016/17 which should be considered now.
Do I pay a Salary or Dividend 2015/16
Our annual guide to considering a tax efficient remuneration package.
Dividends: the new rules from 2016/17 (freeview)
This guide explains the workings of the proposed changes to the way in which dividends are to be taxed from 6 April 2016 and features HMRC's examples from its own factsheet with our own workings.
Essential reading
Tax planning for the 2015/16 year end
NEW: for private clients, directors and business owners. Year end tax planning, topical tips and planning points for discussion with your clients. Schedule those meetings now.
Buy to let: incorporation
NEW: at a glance guide.
Buy to let: personal or company
UPDATE: rewritten to include case study to show tax outcomes for higher rate taxpayers.
Missed last time's update?
Nichola's SME Tax Update 8 January 2016
Features updates for:
- Buy to let ownership and incorporation
- SDLT: consultation on higher rates for buy to lets and second homes
- Farmers' Averaging relief
- HMRC powers and penalties
- Companies: interest paid to directors
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