Just a short update this time. We have a new guide to Schedule 36 Information notices and also a new guide that illustrates changes to the IHT rules, now that the Finance Bill 2013 has been enacted.
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Scroll on down for more news, toolkits, briefings, and updates.
Nichola Ross Martin FCA
Your online Virtual Tax Partner: practical support for accountants, tax advisers and their clients
Problems filing P11Ds online?
HMRC has confirmed that it is giving those affected by online filing problems until 4 August 2013 to file the returns that they could not before. You will need to provide some evidence that it was the online service that prevented filing, see HMRC P11D
Mertrux appeal - franchise goodwill take two
In Mertrux v HMRC  EWCA Civ 821 the Court of Appeal confirmed the existence of a franchisee's goodwill for the purposes of a claim for CGT roll-over relief claim however it disallowed 50% of the total proceeds because it related to a payment for a future loss of income. This case has been of great interest to accountants because we are all keen on cases which confirm or deny the existence of goodwill. Not only is it is a tricky sort of asset to value but intangibles are very valuable in terms of tax relief. When selling a business it can be very difficult to allocate sales proceeds to different types of asset, as you need to do for the intangibles regime, stamp duty land tax or as in this case a claim for roll over relief.
The Upper Tier Tax Tribunal confirmed the decision of the First Tier Tribunal to disallow over a £ one million in sponsorship payments to Plymouth Albion rugby club, it was found that the payments which provided cash for the club to buy more players were not wholly and exclusively made for the purposes of Interfish: they were made also to help the club. Clearly there is a fine balance to be had and Interfish were upset to hear that another taxpayer, Southwest Communications Group had been allowed a deduction for £300,000 odd of sponsorship payments made to Exeter Chiefs, see What can I claim? Sponsorship.
Creative industries tax relief
NEW: HMRC is starting to provide guidance on the new animation and high-end TV film reliefs. The Video games development industry has to wait for State Aid approval.
Missed last time's summary? See Nichola's SME Tax W-update 11 July 2013
Updates and new guides for subscribers
Schedule 36 information notices
NEW: mini guide to HMRC's powers with topical tips and case law
IHT: restrictions on liabilities against the estate
NEW: provisions were introduced by the Finance Act 2013 that restrict to what extent certain liabilities may be deducted against an estate on death. HMRC has now updated its manuals to reflect the changes which may catch out advisers and taxpayers alike.
Goodwill: trade related properties
UPDATE: a handy guide if you are considering valuations for incorporation, roll over relief or stamp duty land tax.
Close Company Loans Toolkit
NEW: this week's essential reading. We have summarised the new rules following the Finance Act 2013 changes which will apply from 20 March 2013 (once the Act receives Royal Assent, with examples, tips and planning points.
Leaving payments and directors
UPDATE: a handy summary that answers many of your FAQs to our Virtual Tax Partner Support line.
Tax penalties: P11Ds
Which penalties apply for late filing and errors in returns.
Limit (cap) on income tax reliefs
NEW: guidance on this Finance Act 2013 measures with examples.
Wear and tear allowance and renewals basis
UPDATE: HMRC withdrew its renewals basis concession in April 2013, and the wear and tear allowance was enacted in 2011/12. Can you still obtain tax relief on the cost of replacing furniture? We look at the small print.
My Tax Return Catch Up campaign This new Self Assessment disclosure opportunity offers best terms yet and seems to be attracting a lot of interest.
A GAAR is born! The general anti-abuse rule now applies following Royal Assent to the Finance Bill 2013.
Consultation: Reform of Close Company Loans to Participator rules More changes proposed for 2014
Car benefit: another co-ownership plan fails The Upper Tier Tax tribunal decides that a car is still "made available" by an employer even though the scheme involved the initial purchase of the car by the employee.
'Simpler' Accounting for tax
Accounting: Simpler Income tax (cash basis) / fixed expenses
Start here (self-employed taxpayers) to decide which of (or both) the new measures to adopt.
Board and lodging adjustments
All change from 5 April 2013.
Cash or accruals accounting toolkit
At a glance summaries with planning points and examples for all advisers in this new guide.
Flat rate expenses or actual cost toolkit
Essential briefing for advisers and clients.
Top Tips for directors
Converting part of a home into an office
How to create a tax-efficient home office.
Directors' tax planning toolkit 2013/14
Our rolling planner which is updated throughout the year
Employee Shareholder Status - tax & planning
NEW: the new measures introducing a new category of employee share owner are interesting for all sizes of companies. Our guide explains all.
Can I charge my company rent for use of my home? UPDATE: you may consider:
- Recharging the company, on the same basis as a conventional home working employee for a proportion of your bills and running costs. This is explained in Working from home (directors) or
- Formalising a licence agreement with your company in order to allow it to occupy part of your property. It then pays you rent and service charges and you then claim all your expenses under self-assessment...More
Working from home (directors)
UPDATE: the same rules apply to home working directors as other employees. However, a directors is more likely to be able to charge rent and there may be some additional issues and complications by virtue of their office.
Do I pay a salary or dividend? 2013/14
UPDATE and re-write of last year's highly popular guide: this is designed to save you having to do all these workings yourself.
Tax masterclass: running an LLP & Co structure
A guide is for trading companies and professional practices: we see many different structures and so we are constantly updating this guidance.
New: a summary of the proposed rules. You may also sign up for our new Masterclass.
ABC or alphabet shares: directors & employees
UPDATE: essential reading for directors.
Consultation on partnership tax avoidance
Wide ranging measures aimed at catching disguised employment (fixed profit share partners who carry no risk) and inappropriate allocation of profit (aiming to allocate profit to non tax-payers). HMRC says that this is not going to cover cases where family members use partnership structures to allocate profits efficiently, as in the Artic Systems case.
Employee owner status
New briefing note to chat over with clients, with links to detailed guidance.
Goodwill and the intangibles regime Update on: case law restriction on purchase of pre 1 April 2002 goodwill from a related party. In Blenheims Estate and Asset Management Limited v HMRC the First Tier Tribunal dismissed a taxpayer's attempt at using a cross option scheme to try and circumvent the restriction for related parties. He claimed at that he was not a participator in the company and so not a related party on the transfer of goodwill. The FTT found otherwise.
Goodwill amortisation challenged HMRC have sought to argue that there can be no deduction under the corporate intangibles regime for goodwill purchased by a company from a related party individual who created it after 1 April 2002 because the individual has not actually incurred any expenditure on the goodwill in question.
Joint income: splitting income within the family
A family tax planning exercise involving joint bank accounts went very wrong when HMRC invoked the Settlement provisions. The tax tribunal seems to have had sympathy with a taxpayer who struggled over the interaction of income tax and trusts anti-avoidance.
Investigations: the presumption of continuity
When the `presumption of continuity' is made during the course of a tax investigation HMRC will take the view that an under-declaration made in one year will have been repeated in other years. The onus of proof is on the taxpayer to disprove this.
Guides and toolkits
Employment related loans
NEW: anti-avoidance measures were announced in the 2013 Budget which may inadvertently catch out some close company owners with partnership interests. Additionally, the exempt limit rises next year.
NICs on dividends
UPDATE: review of the circumstances (based on case law) in which we would expect HMRC to classify dividends as employment income and commentary on the PA Holdings case.
Employment Allowance: NICs £2,000 relief
The NICs holiday ends in September 2013, this relief applies to all employers from April 2014
CGT Top tips: losses & connected persons
Think twice before selling property to your company at a loss; a cautionary tale of clogged losses.
Adviser planning update: losses
Navigating the new losses minefield in 2013/14
Annual Investment Allowance
NEW: a handy summary with planning points
ABC or alphabet shares: directors & employees
UPDATE: essential reading for directors
ABC or alphabet shares: family companies
UPDATE: issues for the family
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