We have an unusual mix of news and articles this week covering further coronavirus support measures, negligence claims in failing to mention Capital Gains Tax (CGT) planning opportunities on a business disposal, PAYE assessments made on directors instead of their employers and, new subscriber guides for beta testing.

Would you think to mention Capital Gains Tax if you were advising on the legal aspect of the sale of a business or would you expect not to comment unless specifically asked? What would you expect from your accountant or adviser if you are selling up? These are both loaded questions, of course. We have just reviewed the case of an unsuccessful claim for damages against a leading firm of accountants who failed to point out a relatively straightforward piece of planning advice in respect of Entrepreneurs’ Relief. To this end, considering the decision in the case and all the recent and upcoming changes in tax compliance, such as (this list is not exhaustive), all those extra tasks we are doing in response to the coronavirus, changes to CGT and SDLT reporting and payment, the Making Tax Digital for Income Tax pilot, it is a good time to review client letters of engagement, preferably with the client, so that they understand the exact scope of your services too.

A claim for a judicial review of the fairness of the government’s coronavirus support measures by an Uber driver in the Scottish courts also ended unsuccessfully this week. The case highlights a systemic bias against lower-paid workers.

Did you know that accountants are potentially 'high risk' when it comes to anti-money laundering (AML) compliance? Subscribers can now beta-test our new suite of AML guides covering risk assessment and identity checking.

One last word on compliance; Professional Conduct in Relation to Taxation (PCRT) rears up again, this time in relation to Research and Development (R&D). New guidance is issued by the seven professional bodies.

Finally, today's other non-tax news headline is that the UK is going to delay the introduction of its coronavirus Track and Trace App until the winter, while most other European countries are going ahead with theirs. I am speechless, now that's quite rare!

If you have any tax-specific queries, please post them up to our sister site, details are here: www.VtaxP.co.uk

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

COVID-19: Tracker
UPDATE: Start here to track the latest government measures and announcements aimed at supporting businesses and individuals during the pandemic. Key action areas: Employee Job Retention Scheme and Self Employed Income Support Scheme.

COVID-19: Early Corporation Tax repayment
HMRC has updated its Corporation Tax guidance covering situations where a company seeks repayment of tax before a return has been filed, as may be the case where a business knows that it has suffered large losses due to the Coronavirus.

Inquiry into the Management of Tax Reliefs
The Public Accounts Committee (PAC) has recently opened an inquiry into the UK's management of ‘tax expenditures’ and tax reliefs provided for certain activities or goods, an area it has kept under review for the last ten years.

Trusts and Estates: What’s New? June 2020
HMRC's latest Trusts and Estates newsletter contains some useful information. Here is our enhanced version.

R&D Relief: Preventing abuse of the R&D tax reliefs for SMEs
This covers measures to restrict abusive claims of the repayable SME credit The closing date for this condoc' is now 28 August 2020. The measure is introduced from April 2021.

Professional Conduct in relation to Research & Development (R&D)
The leading professional bodies have all recently published agreed a series of Question & Answers (Q & A) which explain a member's duties in respect of Professional Conduct in Relation to Taxation (PCRT).

Editor's Pick

Start-ups index for companies
This 'At a glance' guide is essential reading for anyone thinking about starting up a new company.

A new business? Start here...
Guides and checklists in this section help you to choose whether to set up as a sole trader, partnership or company. These take into consideration legal as well as tax issues, together with planning points, FAQs and examples.

Tax planning for directors: start here
Editor's choice: some of our favourite tax guides, toolkits & checklists for directors

Tax Guides and Updates (subscribers)

SDLT: Stamp Duty Land Tax
UPDATE: What are the SDLT rates? What is exempt from SDLT? What reliefs are available?

R&D Tax Reliefs: At a glance
What's Research and Development (R&D) relief? How to claim R&D relief? Small company R&D relief explained? Can individuals claim R&D relief?

R&D: SME Tax Credit Scheme subscriber guide
What Research & Development (R&D) schemes can be claimed by R&D? How to make an R&D claim?

R&D Zone
Worked examples and case studies covering SME and large company R&D claims.

Case Update (Freeview) 

Not negligent for failing to advise on CGT: It was not in the LOE
In Hugh McMahon v Grant Thornton UK LLP [2012] CSOH 50, a firm of chartered accountants were not found to be negligent in failing to recommend some Entrepreneurs’ Relief planning in the event of a share sale. 

Unbelievable: Directors liable for PAYE and NIC on own earnings
In Shamir Pravin Budhdeo, Amarjit Singh Hundal & Joshy Mathew v HMRC [2020] TC7679, the First Tier Tribunal (FTT) denied appeals by directors against regulation 72 assessments for unpaid PAYE. T

Gig workers' challenge to gov's coronavirus support fails
In Ahmed Adiatu & Independent Workers Union of Great Britain (IWGB) v HM Treasury [2020] EWHC 1554, an Uber driver and his union made an unsuccessful claim for a judicial review of the government’s COVID-19 support measures for lower-paid workers.

VAT News & Cases

Reminder: Reinstate your direct debits for VAT
The deferral of VAT payments under the government’s COVID-19 support package ends on 30 June 2020. Businesses who have taken advantage of this must remember to reinstate their VAT direct debits in time for their first post 30 June VAT payment date.

VAT partial exemption and hire purchase agreements
HMRC have just published Revenue & Customs Brief 8: change to partial exemption VAT payments. This affects businesses who supply goods by way of hire purchase agreements.

Virtual Tax Partner Toolkits (freeview)

Virtual Tax Partner © Tax Toolkit© Tax Toolkits
NEW: be a winner with our game-changing tax diagnostics tools. Sign up now.

  • 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.

AML beta test guides (subscribers)

AML: Identification and Verification, Individuals
A subscriber guide to Anti-Money Laundering (AML) identification and verification for individuals. What checks are required under AML rules for identification and verification? What is covered in identification? How do you verify ID?

AML: Risk Assessment (Entities)
A checklist for Anti-Money Laundering (AML) purposes to risk assess prospective clients operating in the Accountancy sector.

AML: Risk Assessment (Accountants)
A checklist for Anti-Money Laundering (AML) purposes to risk assess prospective clients operating in the Accountancy sector.

AML: Risk assessment (Individuals)
A flow chart and decision matrix to assist with determining the level of risk to assign to new clients (individuals) when completing your client take on procedures.

Tax Queries?

Virtual Tax Partner© Support
Have a tax query? Need a second option? Open a ticket and ask a question. A team of tax experts with a very wide range of expertise: covering direct and indirect tax, as well as accounting, R&D claims, reorganisations and much more. 

CPD for lunch 

Byte-sized chunks of CPD for subscribers


More at CPD Index

Missed last time's Web-update?

Nichola's SME Tax W-update 11 June 2020

  • COVID-19: Tracker
  • HMRC's Agent Update June/July 2020
  • Employment-Related Securities: What’s New? June 2020
  • COVID-19: Construction Industry Scheme VAT delay
  • Discovery not stale: Taxpayer's delay was intentional
  • HMRC tracks tax scheme promoters
  • Poor documentation fails to bring about lack of trust
  • No enquiry, no closure notice, no jurisdiction
  • Trusts & Tax planning
  • HMRC's Information powers: at a glance
  • Directors' Tax Planning toolkit 


Nichola's SME Summaries for May 2020
Links to all of May's newswires...More

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