Hello
This week starts with a comedy moment.
I don't know how many of you remember a 1970's sketch by the late Eric Morcambe on the Morcambe and Wise Show. It goes like this: Eric is playing a piano concerto conducted by the famous conductor, Andre Previn, and it goes badly wrong. Andre is exasperated by Eric's inability to play: says Eric to Andre, "I'm playing all the right notes...But not necessarily in the right order."
Last week HMRC's Tax Assurance Commissioner Jim Harra wrote into the Financial Times in an attempt to soothe fears over the cost of Making Tax Digital (MTD). He says that the five returns per year that taxpayers are required to submit under MTD are 'not accounts'... My thinking is that, if the figures that HMRC wants are not accounts then they are something else, but what? It seems that HMRC want all the right figures (that go into accounts) but not necessarily in an order that is of any use to us.
I can see that HMRC want compliance, but having people submit a meaningless jumble of figures and then to possibly suffer penalties for failing to check them is a bit of an 'ask'. At the end of the day, what is so very wrong with having figures in the same order as your accounts? At least you can then see quite easily if you make a profit or a loss.
On a different tack, the Office of Tax Simplification is continuing its review of NICs reform. This looks like a very interesting simplification project.
Many of you may have had clients on the receiving end of Schedule 36 FA 2008 information notices from HMRC. Third Party information notices are less common, although they can be used to obtain a director's personal bank statements; we have a new guide on this topic. We also have an updated guide to Cars and VAT.
Don't miss the Finance Act and taxes 2016/17 rolling planner if you want to keep up to date.
Enjoy the guides and updates and the news is 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)
OTS further review: alignment of income tax and NIC
The Office of Tax Simplification (OTS) has published “Closer alignment of income tax and national insurance” a review which paves the way for NIC simplification and reform.
Further consultation: Gift aid donor benefits
HMRC have published a response and further consultation document “Simplifying the Gift Aid donor benefits rules” following the initial consultation earlier this year.
MTD: all the right figures...just not in the same order as accounts
Doing an 'Eric Morcambe': HMRC's Tax Assurance Commissioner Jim Harra says that the five returns per year that taxpayers are required to submit under HMRC's Making Tax Digital (MTD) are not accounts.
Case Update (freeview)
Sch 36 information notices: FTT has sole jurisdiction
In HMRC v J Ariel [2016] EWHC 1674 the High Court found that the First Tier Tribunal had absolute jurisdiction over whether a third party notice could be issued to a trustee in bankruptcy and what it should say.
Money laundering: late registration penalty upheld
In Blackhorse Property Management Ltd v HMRC [2016] TC05449 the First Tier Tribunal (FTT) upheld but reduced a penalty for failing to register under the money laundering regulations.
IHT: Charitable exemption only applies to UK and EU charities
In Executors of Beryl Coulter v HMRC [2016] EWCA Civ 938 the Court of Appeal confirmed that a legacy to a Jersey charity is not an exempt transfer for inheritance tax.
Discovery assessment: extended time limit didn't apply
In Raymond Tooth v HMRC [2016] TC 05452 the First Tier Tribunal (FTT) found that the extended discovery assessment time limit did not apply as the taxpayer’s deliberate error did not directly bring about the loss of tax. [Editorial note. Tax serendipity, the judgment in this case also refers the Eric Morcambe sketch (see editorial above): Mr Tooth put all the right figures in his return, just in the wrong places. Thank you to barrister Keith Gordon for pointing that out.]
Practical Tax Guides and Updates (subscribers)
Sch 36 third party notices
NEW: A guide to the obligations of HMRC and FTT and the rights of third parties who receive information notices.
Non-domicile status and tax
UPDATED: Sections on CGT rebasing and cleansing relief added, both effective from 6 April 2017 when rules on deemed domicile are set to change.
Leases: plant and machinery
UPDATED: New information added on capital allowances under long funding leases and hire purchase contracts.
Gift Aid News 2016/17
NEW: What's new in Gift Aid? A summary of latest developments and consultations for intermediaries, donor benefits, the small donations scheme and declarations.
A guide to incorporation: start here
Index to our guides in this area.
Editor's Choice
VAT: car or van?
UPDATED: when can you claim back VAT on a car? What is a car? What is a van? What about pool cars, driving instructors and taxis?
Director's Tax Planning toolkit 2016/17
This year's toolkit, like all our maintained guides, is a rolling planner and is updated throughout the year. We will notify you when we make updates.
Finance Acts Rolling Tax Planner 2016/17
UPDATED: Instant CPD: if you want to know what's what in 2016/17 across all the taxes and what is already proposed for 2017/18 ahead of next week's Autumn Statement this guide is for you.
Tax queries
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Vacancies
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Missed last time's update?
Nichola's SME Tax Update 11 November
Features:
- Professional conduct in relation to taxation
- Replacement of Domestic Items relief
- Main residence nil rate band
- Incorporating an existing business
- Pre-registration input VAT
- OTS: small company reforms and simplifying the corporation tax computation
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