This time we feature two of the most topical SME tax cases that you are likely to see for some time. We think we have the answer to the lock-jam that is Brexit, we have more on Making VAT Digital, offpayrolling, the loan charge (you must act now) and more VAT-y stuff too.

HMRC's share and assets valuation (SAV) has argued, for a very, very long time that the skillset of professionals such as doctors, surgeons and dentists remains their own personal asset and cannot be sold for a capital sum. If you have incorporated a professional practice you will know well the full range of SAV's arguments. In a case before the FTT, HMRC tried to argue that a business sale was a disposal of an income stream. The FTT considered these slightly obscure anti-avoidance rules and concluded not: it was capital.

Theatrical artists working in TV are all aware of the perils of IR35. Last year Christina Ackroyd lost a case against HMRC and was found to be within IR35 although since April 2017 the 'Off-payrolling rules' will now apply to her when working for the BBC. It is, however, noted that the results of HMRC's Check Employment Status tool (CEST) may produce questionable results for some types of TV talent, as when HMRC tried to apply IR35 to ITV host's Lorraine Kelly’s personal service company. Another useful victory for the taxpayer.

It also seems that HMRC tried to argue that Ms Kelly was not a 'theatrical artist' for the purposes of deduction of her agent's fees. Looking back to 2006, HMRC attempted the same trick with Richard and Judy and lost that too. Has HMRC's litigation and settlement strategy imploaded or maybe memories are short?

Onto Making VAT Digital: do check out our guides. Following lots more queries on this we have updated our FAQs and done a lot of research for you.

And finally Brexit. I am conscious that we do not all agree, and I am also aware that no one wants to hear another personal opinion from yet another somebody. On saying that, I do think that we have a chance to solve the issues. Hear me out. There is a link below.

If you have any tax queries please do try out our Virtual Tax Partner support portal at www.VtaxP.co.uk. Please note that we are going to be slightly short staffed in early April due to holidays and one of our team is going off to get married - we wish her all the very best for that.

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 and tax advisers

Quick news (freeview)

Structures and Buildings Allowance: draft legislation
Draft legislation has been published for the new Structures and Buildings Allowance: this differs from the original proposals announced in October 2018.

Employment Related Securities: What's New? March 2019
HMRC's latest Employment Related Securities Bulletin contains some handy tips. Here is our enhanced version.

Disguised remuneration settlement and the loan charge
Retrospective taxes: you MUST email HMRC now if you wish to settle to avoid the loan charge which otherwise will be calculated on 5 April 2019 and may go back to tax all your loans since 1999.

Brexit: an opinion

Brexit: what would you do?
There is genuinely a way out of the current national crisis and embarrassment that can appeal to both sides and it will not go back on the referendum result

Making Tax Digital

Agent Services Account: top tips (freeview)
What does this actually do? How to set up and trouble shoot.

Making VAT Digital tool (freeview)
If you are still unsure whether MVD applies to you our tool should help you decide. 

Making VAT Digital 
UPDATE: full and detailed guidance, who is exempt, software issues, all about bridging, digital links and much more.

Editor's Choice (subscribers)

Non-domicile status, deemed domicile & tax
UPDATE: The deadline for cleansing mixed funds is 5 April. The CIOT have updated their Q&As with HMRC and we have updated our guide accordingly.

Sole trader v. limited company: tax differences & savings (2019/20)
NEW: our comprehensive guide explores all the issues and considers whether from a purely tax point of view, it is more efficient to run your business as a sole trader or as a company.

Tax Guides and Updates (subscribers)

IHT Agricultural Property Relief
UPDATE: An ever popular relief: we have added more details about how the replacement property rules work.

CGT: Entrepreneurs' Relief
UPDATE: New examples, FAQs and Planning points, one of our favourite guides.

TAAR: Anti-avoidance & phonexing
UPDATE: with changes to IR35 and off payrolling rules due to apply to the private sector its time to consider the what-ifs and plan ahead. With links to our unique and totally cost saving TAAR tool.

Employment intermediaries & agency rules
UPDATE: changes to the off-payrolling rules mean that its all about payrolling and umbrellas. This guide aims to explain the highly complex rules.

Case Update (freeview)

Sale of surgical practice is capital
In Richard Villar v HMRC [2018] TC 6983 the FTT held that the sale of the business of an orthopaedic surgeon was a disposal of capital and not merely of a right to income...More

Lorraine Kelly wins IR35 case: she is a brand not an employee
In Albatel Limited v HMRC [2019] TC07045 the First Tier Tribunal allowed appeals against assessments of £1.2m on Lorraine Kelly’s personal service company; IR35 did not apply, ITV did not employ her, it was buying her brand. 

VAT cases

Meal replacement juices are food
The Core (Swindon) Ltd v HMRC [2018] TC 06874 the FTT decided that for VAT, fruit and vegetable juices sold as a meal replacement were food and not beverages and therefore zero-rated.

VAT (subscribers)

Brexit no deal: accounting for import VAT
HMRC's update on import VAT if there is no deal Brexit. This explains how VAT registered business should account for import VAT and recover input tax.

Business splitting and VAT (single business directions)
Who may be affected by a single business direction? How can you avoid it? We get asked about this a lot and our guide explains how the rules work and how to make sure you don't get caught by them.

VAT on food and catering
Confused as to how food is treated for VAT purposes? If the food is purchased from a supermarket, one rule may apply. If the same food is bought from a café a different rule could apply. There is also a difference between hot food, cold food, food consumed on premises, food off premises and of course between biscuits and cakes.

CPD for lunch

CPD for lunch
Short management CPD on all the latest topics

Jobs and Opportunites

We have vacancy for tax writers and editors. If you are mad about tax, love writing and want to help us to make the fabulous web resouce that is www.rossmartin.co.uk even better, make CPD and help produce this really popular web update do contact us for more information. Send in your details via our portal at www.VtaxP.co.uk

Missed last time's Web-update?

Nichola's SME tax W-update 15 March 2019


  • Spring statement highlights
  • Agent services accounts top tips
  • Directors: tax planning toolkit for 2019/20
  • Tax efficient extraction of profits: toolkit for 2019/20
  • Employee expenses: laundry costs
  • and much more..

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