This time we have news on Making Tax Digital, tips on Entrepreneurs' Relief, news on trusts and some interesting cases.

There is good news today in that Brexit negotiations have moved out of deadlock onto the next stage of trade negotiations. We are looking for something like a Canada ++ model. The ++ is the part to be negotiated! No one knows the true cost of Brexit and I we can agree that it is an impossible thing to calculate. It is a shame that it has divided the country and I wonder if we will all look back in ten years time and wonder what the fuss was all about.

There was something of a farce in Westminster last week when the government had to admit that no one had actually made any impact assessments on the cost of Brexit to industry. The reason given for that failure was because they were all based on guestimates and no one believes them anyway. This sounds rather like the tax and accounting profession's view of impact assessments that were created for Making Tax Digital (MTD). Anyway, like Brexit, MTD has moved on, and we now have MTD for VAT from 2019 and penalty reform that should see away from the onerous VAT surcharges and a new points based late filing penalties. Late payment will be charged at rates designed to encourage compliance.

We have as usual a selection of topical cases below, and on the theme of penalties, yet more late filing daily penalty notices where HMRC failed to set the correct dates. You would not accept points on your driving licence if the police failed to tell you your speed if you were speeding. Why accept a penalty that does not say from when it starts?

We are all very sad to hear the news that Chris Jones passed away last week. I am sure you will have seen him on the lecture circuit over the years, an absolute bundle of energy who will be missed by many. Our sympathy to his family.

Don't miss our Christmas Advent tax and accounting calendar to bring a little sparkle to your cold offices. Click on a new door each day and all sorts of wonderful delights await you.

If you have any tax queries please do try out our Virtual Tax Partner support portal at www.VtaxP.co.uk

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)

Advisory Fuel Rates from 1 December 2017
HMRC have updated their advisory fuel rates for company car drivers

Overseas businesses to register for CIS
HMRC have released new guidance for overseas contractors and subcontractors who will need to be aware of the Construction Industry Scheme (CIS) rules. 

Case Update (freeview)

Partners not obliged to follow partnership return
R King & Others v HMRC [2016] TC05163 updated as HMRC have withdrawn their appeal against the FTT decision.

HMRC fails to attend Employment Intermediary Return penalty hearing
In Whitehall Pelham Ltd v HMRC [2017] TC06188 HMRC were barred from the proceedings for a complete failure to engage with the tax tribunal; as a result the taxpayers penalty appeal was allowed.

Daily Penalties: HMRC Still Getting Formalities Wrong
In both Behsodi v HMRC [2017] TC6156 and Moore v HMRC [2017] TC6155 the First Tier Tribunal (FTT) was invited to consider whether HMRC had correctly implemented daily penalties. In both cases the answer was 'No'.

New consultations and responses

Consultation: Royalties Withholding Tax
On 1 December 2017, HMRC opened a consultation on extending the rules imposing withholding tax on royalty payments made to non-UK residents. This consultation will close on 23 February 2018.

Entrepreneurs Relief: the 'what, why, when, where' study
HMRC have published the results of recently conducted research into Entrepreneurs relief (ER) to see whether it acts as a motivating factor in individuals’ business, investment, retirement, and tax planning decisions.

Making Tax Digital 

Making Tax Digital: index
UPDATE: for the consultation response on late filing penalties and the proposed new points-based system, as well as the new consultation on late payment interest and penalties.


Trust registration service: new guidance for reporting about beneficiaries
Following representations from the CIOT and ATT, HMRC have amended their guidance with regards to the new online trust registration service requirements in respect of beneficiaries.

Agent access for trust registration service up and running
The online service for agents to register for an account so that they can deal with trust registrations for their clients, is now fully up and running.

Editor's Choice (subscribers & freeview)  

Christmas Advent Calendar
NEW: open a door in our calendar every working day in December and add a little sparkle to your tax and accounting day.

Tax Guides and Updates (subscribers) 

Disputed profit shares
UPDATE: R King & Ors case above.

Non-resident CGT: UK residential property
UPDATE: Indirect disposals of shares in property rich companies will be subject to NRCGT from April 2019 if a new consultation proceeds to legislation.

Loan Relationships
Minor update to add some notes about interest payments and withholding tax.

Disguised Remuneration
UPDATE: We have added more clarification on the close company gateway, transfer of liabilities to employees, and loan charge reporting requirements, following the publication of another technical note by HMRC.

How to Appeal Tax Penalties (subscriber version)
UPDATE: for the Behsodi v HMRC [2017] TC6156 and Moore v HMRC [2017] TC6155 cases (above).


VAT and vouchers: consultation
(Freeview) HMRC have issued a consultation document, 'VAT and Vouchers', which is the first step in the transposition of the EU Vouchers Directive 2016/1065, into UK VAT law.

Registering for VAT
UPDATE: the Chancellor confirmed that the design of the registration threshold will be reviewed but the current £85,000 threshold will remain static for the next two years.

Subscriber Essentials

Autumn Budget 2017: rolling tracker (freeview)
Our unique summary of the key tax measures for SMEs announced in the chancellor's speech and accompanying papers/

Personal Service Company (PSC) update 2017/18
Update: this handy update summarises the key tax issue for personal service companies and their owners following the Autumn Budget.

Property profits and loss toolkit (2017/18 on)
UPDATE: a concise summary for landlords, updated following the Autumn Budget, with links to previous years' toolkits.

VAT update: What's New: Nov 2017 
NEW: an update on the last 6 months of VAT activity for those who want a ‘Budget break’! 

CPD Webinars

New CPD click here

Missed last time's update?

Nichola's SME Tax w-update to 1 December 2017


  • Partnership changes
  • What is a depreciatory transaction?
  • VAT: what's on this autumn?
  • Personal Services Companies
  • New updates and CPD

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