Hello
This time: we have a look at the new Transactions in Securities rules in respect of distributions. HMRC has not yet published case studies and so we have created some to help you understand how the new rules work and what kind of situations to avoid.
Recent changes to pensions mean that those who are on generous pensions schemes (e.g. NHS doctors and dentists) may well be affected by an excess pensions charge in 2016/17. We have updated our pensions guidance.
Don't forget that Tax Credits must be renewed by 31 July. We have various case write ups and up-dates, scroll on down.
We welcome in a new prime minister and of great interest to us in tax is that fact that we have a new chancellor. Philip Hammond has ruled out an emergency budget and we must wait until the Autumn Statement to see what he is planning. His predecessor's plans to reduce the corporation tax rate to 15% had met with a pretty mixed reaction, not least from other EU countries who really don't want to see a race to the bottom in tax rates.
In case you forgot, the 2016 Finance Bill is still going through parliament and one question on many people's minds is 'what has happened to HMRC's next consultation on Making Tax Digital?' We will have to wait and see on that point.
Finally, one quick suggestion for the new chancellor is to ditch the Marriage Allowance. It's too complex and many of those who could use it either don't complete tax returns or are not online to apply for it. Figures released this week show that HMRC has been allowed an extra £1 million this year in order to advertise the allowance.
Back soon
Nichola Ross Martin FCA Tax Director
Your Virtual Tax Partner®: online PRACTICAL support for accountants & tax advisers BY accountants & tax advisers
Quick news (freeview)
Profits from trading in and developing UK Land
Legislation introduced by Finance Bill 2016 to ensure that profit from a UK property trade is chargeable to UK tax even if a company is not UK resident and has no UK permanent establishment take effect from 5 July 2016 and not royal assent as previously intended.
Welsh Land Transaction Tax is on its way
The Welsh Government has set out its proposals for the introduction of the Welsh Land Transaction Tax (LTT) which will replace Stamp Duty Land Tax (SDLT) in April 2018.
Unexpected tax charge for excess pension contributions
The introduction of the tapered annual allowance could lead to tax charges of up to £13,500 for higher earners.
Tax Credits
Don't forget to renew by 31 July.
Case Update
Partners not obliged to follow partnership return
In R King & Others v HMRC the First Tier Tribunal (FTT) found that the members of an LLP could declare a different profit share in their personal returns if they believed that the figure in the partnership return was incorrect.
Prior undertaking prevents HMRC assessment
In Spring Salmon & Seafood Limited v HMRC the Upper Tribunal (UT) held that HMRC were prevented from assessing PAYE and NICs due to a previous undertaking they had given to the company.
Input VAT claim allowed on purchase of car
In Jane Borton t/a Contract Build v HMRC the FTT found that the input VAT paid on the purchase of a car by a sole trader could be reclaimed.
Practical Tax Guides & Updates
Directors and their companies
Transactions in securities: case studies
UPDATED: we includes some new examples of how the Finance Bill 2016 changes might apply.
When can a company be reinstated?
NEW: when can a dissolved company be restored to the register and what does this mean in practice?
Directors' Tax Planning Toolkit 2016/17
This rolling planner looks at a range of director tax issues, including what's new and economical in company profit extraction.
Dividend index
Tax and tax planning, dividend vouchers, legal formalities, tax on illegal dividends.
Sole traders
Losses (sideways): restriction on relief for uncommercial trades
UPDATED: two new case references added to farming losses section: W Donaldson and Alan Ashcroft
Partnerships
Disputed profit share: what do I put in my return?
NEW: what happens when a partner disagrees with the taxable profit they are allocated through the partnership tax return?
Land and Property
Incorporation of a buy-to-let business
UPDATE: SDLT avoidance and VAT issues in mixed use properties. This guide looks at why you migh wish to incorporate and then examines cross-tax as the different factors to consider when incorporating a property rental business.
Offshore
Dividend taxation for non-UK residents
UPDATED: a new section on temporary non-residence and anti-avoidance.
Non-domicile status & tax
UPDATED: following the CIOT's joint submission to HMRC about reducing the costs of non-domiciles de-enveloping UK residential property.
Employers
National Living Wage / National Minimum Wage: HMRC checks
NEW: A guide to HMRC checks and self-reviews of NMW / NLW compliance.
CPD 'for lunch'
Bite-sized chunks of structured CPD
Trivial benefits
NEW: a run through of the new statutory exemption together with worked examples.
Savings income 2016/17
NEW: our webcast takes you through the new allowances with worked examples
VAT essentials for start-ups
NEW: this is part of the talk from Accountex. Don't ignore VAT when you start in business, you may regret it in later years.
Editor's choice
Pensions: tax rules and planning
UPDATED: Index to the pension guides available on the site.
Pensions: tax charge for excess contributions
NEW: A guide to calculating and paying the tax charge for individuals who exceed their annual pension contribution allowance.
Missed last time's update?
Nichola's SME Tax Update 1 July 2016
Features:
- Badges of trade
- Record keeping
- Property investment and letting
- Brexit
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