This time we have news on IR35 and Personal Service Companies, GDPR and much more.

First off, did you realise that you have been misadvising your Personal Service Company (PSC) clients? It seems that HMRC think that 90% of PSC's are incorrectly taxed and so the odds are that if you have a PSC there could be some issues. Great for marketing: why not suggest that they all have a tax 'health check'? A new consultation indicates that PSCs are likely to be brought into the Off-Payrolling rules, this means no IR35 and the end-client operates PAYE. Links to useful guides on this below.

The new General Data Protection Regulations 'GDPR' come into force today. Judging by the random assortment of different kinds of emails hitting my inbox its clear that many folk have no idea about their obligations and it's almost blindingly obviously that the Information Commissioner's office need to step up and make some clear and concise guides for data holders and processors. In the meantime, you have links to our guides below too.

We have just returned from exhibiting at the Accountex Show. Great to meet lots of you but it's exhausting and in terms of cost per sales lead there are much more efficient ways of marketing (we are an online business after all!). All in all though it is good to see what the industry is up to from time to time, although when IT and accountancy combine, the result is business jargon like no other and it was quite tricky to work out what some people were selling. I received some really interesting feedback from accountants: a wide dissatisfaction with tax and accounting software and still a concern that Making Tax Digital just means more hassle and more costs. VT if you are there, people all love the simplicity of your product: do continue your bookkeeping software.

Finally, I did my talk 'How to run the MOST tax efficient accounting practice...ever' at the show and using all available reliefs and benefits managed to get to a tax rate of just 8%. More details for you all in next week's edition.

If you have any tax queries please do try out our Virtual Tax Partner support portal at www.VtaxP.co.uk: subscribers you are entitled to free quick queries so do ask.

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)

HMRC new limitations on non-statutory clearance
HMRC has recently updated its non-statutory clearances pages: it will no longer provide a clearance service for incorporation relief or where certain facts apply to a case.

IR35 private sector reform: consultation
HMRC has issued a consultation: ‘Off-payroll working in the private sector’, this considers whether private sector personal service companies should be mandated into PAYE.

Short term business visitors tax simplification: consultation
HMRC has published a consultation, ‘Tax and Administrative Treatment of Short Term Business Visitors from Overseas Branches’, which looks to simplify tax and admin for short term business visitors (STBVs) coming from overseas branches of UK companies. 

Case Update (freeview)

Non-resident CGT return: Reliance on a tax adviser
In Raymond Hart v HMRC [2018] TC06446 the FTT found that ignorance of the law was not a reasonable excuse when claimed by a taxpayer for the late filing of a NRCGT return, but held that reliance on a tax adviser (who themselves were ignorant of the law) was reasonable.

Football agent loses appeal for trading loss relief
In Jerome Anderson v HMRC [2018] UKUT 0159 (TCC) the Upper tribunal upheld the FTT’s decision to disallow relief for the losses of a football academy run by an agent: it was not run on a commercial basis with a view to a realistic expectation of profit.

Editor's Choice (subscribers)  

Personal Service Companies (PSC) & Tax
UPDATE: HMRC thinks that 90% of your PSC clients are incorrectly taxed. This note tells you all about PSCs, summarises the key issues and offers topical tips for contractors.

Targeted Anti Avoidance Rule (TAAR)
UPDATE: Winding up your PSC? Read this first. Since April 2016 this new rule has applies to distributions in respect of share capital in a winding up. It has some unexpected consequences.

Tax Guides and Updates (subscribers) 

General Data Protection Regulation GDPR
UPDATE: this applies from TODAY. What is it and what does it mean?

GDPR: Statement on Compliance
UPDATE: adapt this template to create your own statement.

Companies: Trading, non-trading and accounting periods
NEW: Guide to when a company is trading or dormant and to corporation tax accounting periods.

Corporate Criminal Offence: failure to prevent tax evasion
UPDATE: for HMRC's updated guidance about self-reporting by companies and partnerships.

VAT (freeview)

Use of bain marie means food subject to VAT

In Pegasus (Manchester) Limited v HMRC [2018] TC06382, the First-Tier Tribunal (FTT) found that a bain marie was used to keep food above ambient temperature meaning it was considered hot food.

VAT (subscribers)

Flat Rate Scheme: limited cost trader
UPDATE: to avoid being a LTC you must have sufficient spending on relevant goods. Software on a disc may qualify but downloaded or bespoke software will not.

Food: catering and takeaway
UPDATE: more cases added on when food is 'hot'.


CPD Webinars

style="text-decoration: underline;">New CPD click here

Missed last time's update?

Nichola's SME Tax w-update 18 May 2018


  • EU gives EMI state aid approval
  • P11Ds: exemption for paid and reimbursed expenses
  • Doctors and Dentists: what expenses can I claim?
  • Loyalty schemes, vouchers and VAT
  • and much more..

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.