We are taking a closer look at some recent tribunal decisions affecting companies and their owners this week. We also have yet more updates on the Loan Charge and more VAT announcements.

In this week's cases, we feature a couple of late filing penalty cases. They illustrate that company owners do need to be 'switched on' when it comes to corporation tax filing requirements: you cannot avoid the fact that it is your duty to ensure that accounts are filed on time. 

In recent years there have not been many tribunal cases that have considered the different tax outcomes when a company makes loans to a director. Given the multiple rule changes that were introduced in April 2016, I wager that it is only a matter of time before a few pop up as some of the rules, particularly around 'bed and breakfasting', are surprisingly complicated. We have updated several guides on this topic as it's sensible to revisit the rules from time to time. We have also summarised a case where the FTT agreed to curtail an extended 'fishing trip' by HMRC into a director's bank statements: his personal expenses had no bearing on whether a s455 tax charge applied to his company.

In terms of the headline news, it comes as a relief that the CIS VAT reverse charge has been postponed for one year. We are, however, perplexed as to the timing of a review of the Loan Charge when so many people have now settled. There are more useful tips from our readers in our Making Tax Digital for VAT blog and check out the planned downtimes for the Making Tax Digital service as I know that many of you work weekends to catch up. 

Our new CPD is Transactions in Securities, essential viewing given the recent rule changes.

If you are visiting 'Professional Accountancy' at the NEC on 18-19 September come and see us on stand E21. We are demo-ing our new Entrepreneurs' Relief tools and we can show you over our website if you are thinking of subscribing and want to see more.

If you have tax queries contact the Virtual Tax Partner support portal at www.VtaxP.co.uk.

Enjoy the guides and updates and the news is below. Subscribe now: you cannot get better value elsewhere!

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)

Making Tax Digital for VAT: downtime
Check out the planned dates and times and avoid Monday 23 September.

Chancellor orders Loan Charge review
Following the recent undertaking by the Prime Minister for an independent review of the loan charge, the Chancellor has now commissioned Sir Amyas Morse to complete the review in advance of the 2018/19 tax return deadline.

CIS VAT reverse charge delayed
The start date for the new VAT regime for the Construction Industry Scheme is delayed by a year to 1 October 2020.

Jobs and opportunities with us
NEW: tax and non-tax varied roles and specialist opportunities for our expanding online tax and business platform.

Tax Bait (freeview)

A (sometimes) more light-hearted look at tax and the news

7 vital things PSC owners must do before 6 April 2020
On balance, tax things are not looking good for PSCs...More

Freeview updates 

SDLT: Residential property higher rate: At a glance
A guide to the higher rates of SDLT on dwellings.

Allowances: Trading and Property: At a glance
A guide to the trading and property allowances.

Incorporation relief: At a glance
A guide to capital gains tax relief on incorporation. 

Tax Guides (subscribers)

Disguised remuneration loan charge (subscriber guide)
UDPATED: For the latest on the loan charge and settlement of schemes.

Directors' Loan Account Tooklit
UPDATED: a detailed guide covering the different outcomes of company loans to directors and participators.

Company loan to participators toolkit
UPDATED: a detailed look at the corporation tax treatment when a Close Company makes a loan to a participator (director-shareholder). It also provides links to our guides for individuals on the making of loans to companies.

Companies: Year-end tax planning
UPDATED: A useful direct tax tool for clients with September year-ends and looking ahead for those with 31 December accounting periods.

Case Update (freeview)

Shareholder compensation was for lost value not damage to reputation
In John Robinson v HMRC [2019] TC07286 the First tier tribunal dismissed the claim that a payment to an aggrieved shareholder was compensation for personal wrong or injury and held that it was subject to capital gains tax.

FTT limits 'fishing trip': further examination of director
In Perfectos Printing Inks Ltd, Perfectos Printing Inks Group Ltd & Dr John Price v HMRC  [2019] TC7203 The FTT decided that an extended check of a director’s personal bank statements was not reasonably required for the purposes of checking his own tax liability or that of his company.

Three strikes and you pay the late filing penalty
In B Humphreys Building Construction Ltd v HMRC [2019] TC7289 the First Tier Tribunal dismissed an appeal against corporation tax return late filing penalties; reliance on an adviser and software issues were not a reasonable excuse for a third successive late return. 

Late appeal dismissed: company must address own tax affairs
In PJD AV Services Ltd v HMRC [2019] TC7336 the First Tier Tribunal refused to allow a late appeal against a corporation tax late filing penalty; it was up to the company, not its agent to ensure its tax affairs were up to date.

Making VAT more Digital (freeview)

MTD: VAT blog
This time: evidence of a light touch by HMRC, tips on browsers and observations that software is not always following HMRC's guidance. 

VAT & VAT cases

Personal liability for unpaid VAT penalties
In Mr Kamraan Hussain v HMRC [2019] TC 7325, the First tier tribunal upheld a director’s personal liability notice (PLN) for inaccuracy penalties for two VAT quarters but cancelled it for a third period.

PPI claims company was not providing insurance
In Claims Advisory Group Ltd  v HMRC [2019] TC07308 the First tier tribunal decided that a company engaged in recovering personal protection insurance (PPI) was not itself making an exempt supply of insurance services.

Virtual Tax Partner Toolkit (freeview)

Virtual Tax Partner © Tax Toolkit© Tax Toolkit
NEW: be a winner with our game-changing tax diagnostics tools:

  • Entrepreneurs' Relief: Sole traders: sale of a business, incorporation, sale of assets
  • Entrepreneurs' Relief: Company owners: rules for sales pre 29 October 2018, sales between 29 October 2018 and 5 April 2019 and after.
  • TAAR: closing your Personal service company? Will your final dividends be taxed as income?
  • Salary or dividend, or a mixture of both. Better to claim the Employers' Allowance?
  • Making Tax Digital for VAT: when do you need to join.

TaxKeep Apps
NEW: these Apps are currently free for subscribers. For a small fee they can be customised with your logo and then distributed to your clients. Complete the form to sign up for your own App.

CPD for lunch 

Byte sized chunks of CPD for subscribers

NEW: Transactions in securities, see: CPD Index

Missed last time's Web-update?

Nichola's SME W-update 6 September 2019

  • Complete the OTS self employed tax payment survey
  • Transfer of Assets abroad: transferor of shares into an offshore family trust.
  • Entrepreneurs relief claim on a sale of shares by a trust
  • Disallowed employee travel expenses
  • Sole trader v limited company differences and tax savings 2019/20
  • VAT: treatments for Botox and nail fungus not exempt
  • VAT margin scheme: reporting issues
  • VAT: Making Tax Digital: more fixes and tips
    and much more..

Come and join our Cloud

Subscribe (and UNLOCK the whole site) A single user annual subscription is £399 (+ VAT)

What do you get?

  • We keep YOU up to date in SME tax.
  • FULL access to www.rossmartin.co.uk: your firm's favourite TAX INTRANET containing over 3,500 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 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.