This time we feature our latest VAT What's new? guide for you. The Office of Tax Simplification is carrying out a review of VAT, so while we're in pre-election purdah, now is a good time to reflect on the oddities of VAT.

We have a lot of VAT cases this week too and we have updated our guide on taking over a business and VAT. One top tip if you take over a business premises is to ensure that you do detailed VAT due diligence. You can end up with a transfer of a going concern (TOGC) despite the fact that the previous business had apparently failed. This means that you are forced to register from day one if the previous business was VAT registered or should have been VAT registered. 

Other updated guides this week include Schedule 36 Information Notices and Third Party information notices. We note that HMRC often make requests for third party information in a notice, for example writing to an individual and also asking for company information, or in writing to a company and asking for a director's personal bank statements. Of course a company is a separate legal entity to its owners and the FTT considers such requests are enough to make a notice invalid. If HMRC's drafting invalidates a notice there is nothing to prevent HMRC issuing another notice; however the important point to note is that penalties do not apply to invalid notices, so it is worth checking the validity of any notice as soon as it comes in.

Finally we have had several enquiries on certain aspects of divorce this week so we have updated our guide and made a new Divorce Toolkit. Further updates below.

If you have any tax queries please do try out our Virtual Tax Partner support portal at www.VtaxP.co.uk. Please contact me for demos of our highly popular new Taxkeep App.

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

Case Update (freeview)

Hardship application upheld by Upper Tribunal
In HMRC v Elbrook (Cash & Carry) Limited [2017] UKUT 0181 the Upper Tribunal (UT) upheld a VAT hardship application even though the taxpayer had a number of valuable investments. 

Recording studio was a business not a hobby
In Gravel Road Records Ltd v HMRC [2017] UKFTT 080 the First-Tier Tribunal (FTT) concluded that VAT incurred on construction of a recording studio was recoverable as it related to a commercial business activity not a hobby. 

Hire of wedding room not exempt supply
In Blue Chip Hotels Limited v HMRC [2017] UKUT 0204 the Upper Tribunal (UT) found that hiring out a hotel room for wedding ceremonies was not an exempt supply of land for VAT purposes. 

Avoidance scheme: a sham and not a trade
In The Brain Disorders Research Limited Partnership & Neil Hockin v HMRC [2017] UKUT 0176 the Upper Tribunal (UT) found that an R&D Allowance tax avoidance scheme was a sham and the partnership involved was not trading.

Practical Tax Guides and Updates (subscribers) 

EIS: Enterprise Investment Scheme
UPDATED: More information added on deferral relief available where gains are reinvested in EIS shares.

Divorce and tax
UPDATE: new CGT and disposals toolkit. 


A VAT Update: What's New? May 2017
NEW CPD special: a look at the recent changes, hot topics and key cases affecting VAT. 

VAT traps: taking over a business or a new business premises
UPDATE: don't overlook VAT if you succeed a defunct business or you are granted a new lease but carry on a similar business to the last occupant of the premises.

EC Sales Lists
NEW: If you supply goods or services to EU businesses, you may need to complete an EC Sales List (ESL) to tell HMRC about those supplies. 

Land and Property

Take a tour (freeview)
CLICK here to see our Land and Property guides. From ATED to Welsh LTT...more

SDLT: Amending returns
NEW: When can I amend an SDLT return, and how?

SDLT & residential property (dwellings): higher rate
UPDATE: what's a dwelling, does the higher rate apply to land, residential v commercial land, company purchase of dwellings.

Editor's Choice (subscribers)  

Sch 36 Information Notices
UPDATE: what makes a notice invalid?

Third Party information Notices
UPDATE: new cases invalid notices and no rights to inter parte hearings.

Tax efficient extraction of profits: toolkit (2017/18)
NEW: company toolkit designed to help directors decide how to plan salary, benefits, expenses and dividends. 

Directors: tax planning toolkit for 2017/18
NEW: covers key essentials for directors to plan their affairs for the next year.  

New Business

Starting in business: start here
UPDATE: what advice do you give a start up in 2017?

Incorporation of a property business
UPDATE: this guide takes you across the key taxes and also considers the new interest restrictions that commence in April, corporation tax and stamp duty land tax.

Making Tax Digital

Making Tax Digital: toolkit for accountants
UPDATE: what's hot and what's not in MTD. Planning for MTD for you and your clients.

Making Tax Digital: index
UPDATE: the latest news

CPD Webinars

New CPD click here: for:

  • Making Tax Digital: practical issues for accountants
  • How to create the MOST tax efficient practice...ever!

Missed last time's update?

Nichola's SME Tax w-update 19 May 2017


  • Employment related securities: 6 July filing and reporting deadline
  • New HMRC guidance on money laundering supervision
  • Corporate criminal offence of failing to prevent facilitation of tax evasion
  • Cases on VAT on holiday park fuel, round the world schemes and uncommercial trades
  • Buy to let: company or personal ownership?
  • Savings and tax
  • Dividend taxation
  • Personal service companies
  • Can I charge my company rent?
  • What constitutes a valid VAT invoice?
  • VAT penalties and assessments

Come and join our Cloud

Subscribe (and UNLOCK the whole site) A single user annual subscription is £365 (+ 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.