The government has published the first batch of its new policies and consultations alongside a draft Finance Bill for 2021. We have reviewed the following measures.
Income tax, claims & reliefs
Post-Employment Notice Pay on termination of employment:
- HMRC have published a policy paper, 'Changes to the treatment of termination payments and post-employment notice pay for Income Tax'.
- Draft legislation
See Post-Employment Notice Pay on termination of employment
Pensions: collective money purchase benefit schemes:
- The government has published a policy paper: ‘Pension schemes: collective money purchase benefits’ about changes to the tax legislation from April 2021 to allow collective money purchase schemes to operate as UK registered pension schemes without unintended tax implications, such as unauthorised payment charges.
- Draft legislation
Employers
VBC reduced to nil for zero-emission vans:
- The government has published a policy paper, ‘Income tax changes to the van benefit charge from 6 April 2021’. It proposes to reduce the van benefit charge (VBC) to nil for zero-emission company vans.
- Draft legislation
Changes to working time requirements for Enterprise Management Incentive (EMI) schemes:
- The government has published a policy paper 'Changes to working time requirements for Enterprise Management Incentives'. It proposes measures to ensure that individuals who are furloughed/have had their working hours reduced below the statutory working time requirement for EMI due to COVID-19 will retain the tax advantages of the scheme. This extends measures already introduced by Finance Act 2020 to EMI options granted after 19 March 2020.
- Draft legislation
Companies
Technical amendments to the Corporate Interest Restriction for Corporation Tax:
- The government has published a policy paper: 'Technical Amendments to the Corporate Interest Restriction for Corporation Tax' which proposes special provisions for REITs now that UK property businesses of non resident companies are within the charge to Corporation Tax and no penalties for a late interest restriction return if there is a reasonable excuse for the failure.
- Draft legislation
Penalties, assessment, & compliance
Licence renewals to come with a new tax check:
- The government has published a policy paper, 'New tax checks on licence renewal applications', proposed for inclusion in Finance Act 2021. The new measure will require individuals and businesses applying to renew licences to drive taxis and private hire vehicles.
- Draft legislation
See Licence renewals to come with a new tax check
Proposed Amendments to HMRC's civil information powers:
- HMRC have issued a policy paper ‘Amendments to HMRC's civil information powers’ together with responses to their 2018 consultation ‘Amending HMRC’s Civil Information Powers’ and draft legislation which proposes introducing a new Financial Institution Notice (FIN).
- Draft legislation
See Proposed Amendments to HMRC's civil information powers
Government consults on how to tackle tax avoidance schemes:
- The government has launched two new consultations dealing with tax avoidance, ‘Tackling promoters of tax avoidance’ and ‘Call for evidence: Tackling Disguised Remuneration tax avoidance.’
- Draft legislation:New proposals for tackling promoters and enablers of tax avoidance schemes
See Government consults on how to tackle tax avoidance schemes
Stamp duty
Modernisation of the stamp taxes on shares framework:
- The government has launched a new call for evidence ‘Modernisation of the stamp taxes on shares framework: call for evidence’ looking at a new framework for taxing shares and securities under Stamp Duty and Stamp Duty Reserve Tax (SDRT).
Land & Property
Non-UK Resident Stamp Duty Land Tax Surcharge:
- HM Treasury has published a response to ‘Stamp Duty Land Tax: non-UK resident surcharge consultation’. Announced in Budget 2020 but excluded from Finance Bill 2020, a 2% surcharge will be introduced from April 2021 for non-residents buying UK residential property.
- Draft legislation
See SDLT: Non-residents' extra surcharge draft proposals
Stamp Duty Land Tax (SDLT) relief from the higher rates:
- The government has published a policy paper 'New reliefs from Annual Tax on Enveloped Dwellings and Stamp Duty Land Tax for housing co-operatives'. From 11 March 2020 it is proposed that there will be relief from the 15% rate of SDLT for land purchased for use by a housing co-operative.
- Draft legislation
Annual Tax on Enveloped Dwellings (ATED):
- Relief declaration forms for the year ending 31 March 2020 had to be submitted by 30 April 2019 with tax paid in advance due on the same date.
- The government has published a policy paper 'New reliefs from Annual Tax on Enveloped Dwellings and Stamp Duty Land Tax for housing co-operatives'. From 1 April 2020 it proposes:
- New relief for housing co-operatives.
- Eligible housing co-operatives can claim an ATED refund for 2020-21 chargeable period.
- Draft legislation
Other
Changes to Small Brewer's Relief:
- The government has concluded its review of the Small Brewer's Relief and announced that it intends to remove the 'cliff-edge' of production levels and taper relief.
See Changes planned to Small Brewer's Relief
Useful guides for our subscribers
Finance Act 2020: Rolling planner and tracker
Follow key tax announcements in real time
Finance Bill 2021: proposals to date
We list the proposals for the new bill.
