Hello
We have summarised the new VAT notice 700/22 on Making VAT Digital (MVD) for you and we have also made an update of our Making Tax Digital (MTD) index. All essential reading and freeview this time.
Those who have read the VAT notice will note that from 2020 'cutting and pasting' from spreadsheets is to be a banned activity: HMRC cannot interrogate cut data. Aside from the fact that no one cuts, when there is a 'copy' command, this of course means that everyone who is currently inputting data, let's say by journal from one source, e.g. a spreadsheet, into their accounting software will now need special linking software, unless your accounting software allows you to import your spreadsheet.
In terms of what is going to be MVD compatible, HMRC have now published details of further software. There is a growing list of suppliers and the task of selecting the right tool for the job is going to be an onerous one as suffice to say every client is different and so one size will not fit all. It is not as if software pricing is transparent either. We run a small practice (in the background of this webservice) and not one of our VAT registered clients has yet even got to grips with basic cloud accounting. I am not surprised: they are entrepreneurs and not 'bean counters', MVD is going to need a very long 'soft landing' period.
We have been continuing the update of our Finance Act 2018 and Finance Bill 2019 rolling planner if you think you have missed any new developments in tax. This tracks pretty much all key SME announcements.
We also have updates on Transactions in securities (TIS), the fundamental change in ownership rule is a tricky one. Once you start checking whether there is a TIS issue on share disposal then you realise that tax is now the tail wagging the dog, and of course the TIS rules are only triggered if one of the aims is to secure a tax advantage. Catch 22 and all that.
Hope you are enjoying the sunshine.
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 CTA (Fellow) Tax Director
Your Virtual Tax Partner®: online PRACTICAL support for accountants & tax advisers BY accountants & tax advisers
Quick news (freeview)
Disguised Remuneration settlements raise over £500m
HMRC's new briefing ‘Disguised Remuneration charge on loans’ confirms that only 5,000 people have settled up so far. It includes more details about time to pay for individuals who have taxable income for 2018-19 of less than £50,000. If you do not settle, the new loan charge will apply from April 2019.
Requirement to Correct: Extended deadline and penalty mitigation
HMRC have issued updated guidance on the Requirement to Correct (RTC) legislation which sets out the different levels of mitigation for penalties for failure to correct and extends the deadline by 90 days in some circumstances.
No change to PAYE code for flexi pension
HMRC have confirmed that they do not intend to change how they deduct tax on flexible pension drawdowns.
Making Tax Digital (freeview)
Make Tax Digital: the index
What is going on, when it will affect you and links to all the relevant pages.
Making Tax Digital: New VAT Notice
VAT Notice 700/22 sets out the proposals for sets out who needs to follow the MTD rules, what records need to be kept, and what agents need to do.
Editor's Choice (subscribers)
Transactions in securities: surplus cash
UPDATE: clarification of the 2016 changes which now may well affect the taxation of the proceeds of share disposals in cash rich companies (even if made to a third party) when the fundamental change of ownership condition is not met.
Employment related securities: how to give shares
UPDATE: tax traps on gifting of shares or making share awards at less than market value to directors or employees.
Tax Guides and Updates (subscribers)
Finance Act 2018 and Finance Bill 2019: tax update and rolling planner
UPDATE: an invaluable resource which shows you what is new and proposed for each tax and taxpayer this year and the next.
Losses: trading and other losses
UPDATE: For amendments in the draft Finance Bill 2019 to ensure double relief is not available for terminal losses and group relief.
ATED CGT: UK residential property & non-natural persons
UPDATE: HMRC have proposed, as part of the Finance Bill 2019 changes to NRCGT, that ATED CGT will be abolished from April 2019.
Losses, trade losses and sideways relief
UPDATE: for recent query, clarifying how terminal losses can be used.
Rent A Room relief
UPDATE: for HMRC examples of proposed new shared ownership condition.
VAT (freeview)
VAT and vouchers - draft legislation
Finance Bill 2019 proposes changes to the VAT treatment of vouchers. HMRC has also published a consultation response, ‘VAT and Vouchers – summary of responses’. The law transposes the EU Vouchers Directive 2016/1065 into UK law.
Individuals to join VAT groups: draft legislation
Finance Bill 2019 includes proposals for individuals and partnerships to join VAT groups with companies. HMRC has also published a policy paper, ‘VAT grouping eligibility criteria changes’.
VAT (subscribers)
Partial exemption & input VAT
UPDATE: recent case law and latest appeals added
CPD Webinars
Missed last time's update?
Nichola's SME Tax w-update 13 July 2018
Features:
- Schedule 36 information notices
- 30 day CGT payment window for residential property
- Rent a room relief consultation response
- Penalties: deliberate failure to file
- Extending NRCGT to commercial property
- and much more..
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