This week we are focusing on directors and featuring many new guides and topical cases. We have a couple of contrasting PAYE regulation 72 cases, this is the legislation that allows HMRC to pass on a liability for a company's PAYE to its director. 
Reg 72 assessments occur on liquidation: my top tip is that if your company is getting into financial difficulty take advice from an insolvency practitioner before voting yourself any salary or bonus. If you are in financial difficulty you will not be able to pay a dividend as it is unlikely that you will have sufficient distributable reserves to do so.
Talking of dividends, we have a step-by-step guide for your clients on how to pay a dividend and links to our dividend index.
In case you missed it, the Office of Tax Simplification have ongoing discussion documents that propose to introduce not one, but two new trading vehicles into the UK. If you struggle to keep up to date with tax and think that this is a complication too far and not a simplification I recommend that you shout loudly about this now. Responses to the consultation are required by 30 September 2016, follow the links near the bottom. We have summarised the questions for you.

Finally we are featuring guides for directors on remuneration, planning and setting up family companies. 
Our Quick news and other cases write ups below. 

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)

Autumn Statement date announced
Chancellor Philip Hammond will deliver his first Autumn Statement on Wednesday 23 November 2016, this will outline proposals for Budget 2017.

A Scottish approach to taxation: call for evidence
The Scottish Parliament is seeking views ahead of developing a new approach to taxation.

Childcare providers: sign up now for Tax-Free Childcare
HMRC has begun contacting registered childcare providers inviting them to sign up online to make sure that they are eligible to receive payments from the tax-free childcare accounts being introduced from early 2017.

No Class 1A liability? Tell HMRC online
Employers and agents no longer have to submit a paper form P11D(b) to HMRC if they have not submitted any P11D forms. 

Case Update

Directors receiving salaries shortly before company liquidation

Two contrasting decisions on PAYE Reg 72 were published by the First Tier Tribunal in August 2016.  In both cases the directors had taken salaries prior to liquidation.

In Phillip Marsh and David Price [2016] TC05288 the directors were held liable for their company's unpaid PAYE: they took increasingly large salaries in the months running up to liquidation, despite ongoing and consistent PAYE and VAT arrears. The amounts that they paid themselves also did not agree to the payroll records available.

In Stephen West v HMRC [2016] TC05285 the director was not held liable for his company's PAYE: the company’s liquidator suggested a payment of salary which then was properly processed to clear a director’s loan account. The accounts showed PAYE/NICs to be deducted. 

No ER on disposal of business property
In Dilip Amin v HMRC [2016] TC 05265 the partial disposal of an accountant's business premises did not qualify for CGT Entrepreneurs’ Relief just because he also disposed of some goodwill at the same time.

HMRC phone delays are a reasonable excuse
In McNamara Joinery Ltd v HMRC [2016] TC 05278 problems getting hold of HMRC by phone were found to be a reasonable excuse for late payment of VAT.

Change in flat rate scheme percentage can be backdated
In JJK Engineering Ltd v HMRC [2016] TC05351 a company was allowed to backdate the change to their business category from "Architect, civil or structural engineer" to "Any other activity not listed elsewhere”. 

Practical Tax Guides and Updates
(unless they say "freeview" these are for subscribers only)

How to pay a dividend: step-by-step guide
NEW: A step-by-step guide for sole director/shareholder companies.

Dividend index (freeview)
Tax and tax planning, dividend vouchers, legal formalities, tax on illegal dividends.

VAT: Annual accounting
NEW: Prepare one VAT return a year instead of four; a guide to HMRC's annual accounting scheme.

VAT: Cars and vans
UPDATED: A guide to determining what is a car and what is a van, and what the different VAT implications are.

Company cars
UPDATED: our guide to company car taxation

Editor's choice  

Deadlines: compliance (individuals & companies)
A guide to the key filing and payment deadlines for companies and individuals.

Directors: tax planning toolkit for 2016/17
Our comprehensive guide to tax planning with links to guides on all issues affecting directors.

Tax-efficient extraction of profits: toolkit
A guide designed to help a company and its owner decide how company profits are to be extracted.

Tax planning for university: a parents' guide
A topical guide.

How to gift your shares to the family
A guide to gifting some of your private company shares to members of your own family.

Family companies: alphabet shares
A guide examining the tax consequences of creating different share classes in a family company.

Family Investment Company
A guide to the tax consequences for holding family investments in a corporate vehicle; includes a case study.

Buy to let: incorporation
Tax implications when incorporating a property business: CGT, SDLT, VAT and ATED.

Featured consultations (FREEVIEW)

Taxing small companies


The Office of Tax Simplification has published two consultations for two new trading entities. Response required by 30 September 2016:

  • 'Lookthrough' taxation: shareholders being taxed directly on the company’s profits instead of the company paying corporation tax. Read more...
  • A ‘sole enterprise protected assets’ vehicle (SPA) which would provide the self-employed with limited liability for their main home. Read more...


Missed last time's update?

Nichola's SME Tax Update 9 September

Features include:

  • Self employed update
  • Accounting periods and tax basis periods
  • VAT registration, de-registration and place of supply of services
  • Farming and market gardening
  • Consultations: Tackling the hidden economy, Worldwide disclosure facility

Come and join our Cloud

Subscribe (and UNLOCK the whole site) A single user annual subscription is £349 (+ VAT). 

What do you get?

  • We keep YOU up to date in SME tax.
  • FULL access to www.rossmartin.co.uk: your firm's personal TAX INTRANET containing over 2,500 actively maintained tax guides, briefings, toolkits and checklists.
  • Want to know more? Commission your own articles and checklists.
  • Structured CPD: our detailed SME tax updates "for Advisers Only" provide topical summaries and planning notes & our NEW webcasts provide you with structured CPD at your desk.
  • Regular client tax briefings: these cover the latest business and employment tax issues and are designed to assist you plan meetings and improve your client services.
  • Nichola’s regular SME tax news web-update: we do the reading and cherry pick the best of the taxpress, magazines and websites for you.
  • You can also commission guides and checklists for your own practice, post comments and upload your own articles.
  • Access to the Virtual Tax Partner ® service provides subscribers with FREE quick calls and a discount of on phone, email and tax support and mentoring.