This week we feature a handy summary of the government's latest measures for re-booting the economy. We also review cases with an employment theme, we revisit the High-Income Child Benefit charge and have a look at some cases where VAT exemption for medical treatments was in question.

The government's bike scheme is an interesting idea. You claim a voucher to finance the renovation of your old bicycle and then you can ride out and get cycle-fit. In the past one could always find an old cycle at the council dump, more recently, all the cycles seem to go straight into the scrap metal tip. Maybe now that situation will reverse, and we will become a nation of re-cyclers. 

We have some important deadlines coming up in terms of coronavirus funding, notably 31 July being the last day to claim for the first round of the employee job retention scheme (JRS). We have seriously tied ourselves in knots trying to work out what to claim for a client's part-time, semi-furloughed staff. Happily for us, all the staff are back at work now. Income Tax payments on account are also due on 31 July, these can be deferred if you are short of cash. See our Coronavirus Government Support update for July 2020 for details.

Looking at tax cases this week, the Employment Intermediaries' Return penalty appeal is a bit of a head-turner. It features the situation whereby no one could agree whether a return was due and this put the employment agency in a really difficult situation. Should they appease HMRC and file a return that tax counsel said was not needed or challenge HMRC and face the consequences? After filing the return, a penalty was automatically generated and what was clearly going to be a 'lose-lose situation' was saved by the leniency of the tribunal.

Meanwhile, there was a win for HMRC in the Upper Tribunal. The TalkSPORT IR35 case examined the concept of 'mutuality of obligation' and found that it was very much alive and well and present. I keep saying this and I will say it again, we absolutely need a statutory employment test. Can we consult on that, please?

If you have any tax-specific queries, please don't email me, I get hundreds of emails in a day and the chances are that I will miss something vital. Do though post them up to our sister site: 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

Coronavirus Government Support update: July 2020
Coronavirus/COVID-19 July 2020 update. There are some new deadlines and dates for our diaries. This update highlights some of the key measures that may now need your urgent attention.

Fix your Bike Voucher Scheme
Under the Fix your Bike Voucher Scheme bicycle owners will be able to apply for a voucher online and bring their bike to you to be fixed, using the voucher to cover up to £50 of the cost of repairs.

£20m in new grants for SMEs
The government has announced a new £20m grant scheme to help Small and Medium-sized Enterprises (SMEs) as part of their package of measures to support businesses during the COVID-19 pandemic.

Trust registration service: Proposed rules from 2022
HMRC have published a response to their consultation ‘Fifth Money Laundering Directive and Trust Registration Service’ which includes a list of trusts which will now be exempted from registration and a concession relevant to non-UK trusts. 

Call for evidence: Raising standards in the tax avoidance market
HMRC have opened a new call for evidence ‘Raising standards in the tax avoidance market’ which seeks suggestions on how to raise and maintain high standards of competence and behaviour in the tax advisory market.

Editor's Pick

High-Income Child Benefit Tax Charge
UPDATE: What is the High-Income Child Benefit Charge? Who pays it? Can you appeal against an assessment? Are there any useful cases from the tax tribunals? 

COVID-19: Tracker
UPDATE: Start here to track the latest government measures and announcements aimed at supporting businesses and individuals during the pandemic.

Guides and Updates (subscribers)

Land & Property: An Adviser’s Tax Update July 2020
Land and Property taxes: an update for paid subscribers.

SDLT: Non-residents' extra surcharge draft proposals
Proposals for a new surcharge of 2% new rates of Stamp Duty Land Tax (SDLT) for non-UK residents. 

AML: Anti-Money Laundering Zone 
Check out our practical AML resources of guides, checklists and articles.

Case Update (Freeview)

Employment Intermediaries Return: Did not exemption apply?
In Fastklean Limited v HMRC [2020] TC2004, an employer who filed Employment Intermediaries Returns to please HMRC was successful in claiming reasonable excuse for late filing. 

TalkSPORT obliged to provide work: Presenter was an employee
In HMRC v Kickabout Productions [2020] UKUT 0216, the Upper Tribunal (UT) allowed HMRC’s IR35 appeal finding that a radio presenter was an employee.

Termination payment: Discovery assessment in-valid
In Heather Jones v The Commissioners for HM Revenue and Customs: [2020] UKUT 0229, the Upper Tribunal allowed an appeal against a discovery assessment for higher rate tax on a severance payment.

Penalty appeals fail: Taxpayers knew returns were inaccurate
In Dr Marie Hallen & Dr Anette Persson v HMRC [2020] TC7775, the First Tier Tribunal (FTT) upheld penalties for inaccuracies in tax returns relating to a tax avoidance scheme. The taxpayers knew their returns were wrong, their behaviour was deliberate.

HICBC claims another parent 
In Thimmaiah Gummatira v HMRC [2020] TC7767, the First Tier Tribunal (FTT) dismissed an appeal against penalties for failure to notify HMRC of a liability to the High-Income Child Benefit Charge.

VAT Update

Are pregnancy scans VAT exempt?
In Window to the Womb (Franchise) v HMRC [2020] TC 07687, First Tier Tribunal (FTT) found that pregnancy scans were medical care and therefore exempt from VAT.

Is the supply of medical staff exempt?
In Mainpay Limited v HMRC [2020] TC07690, First Tier Tribunal (FTT) found Mainpay was making a taxable supply of medical staff for VAT rather than exempt medical care.

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.

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 23 July 2020

  • Making Tax Digital (MTD): Index & NEW timeline
  • Finance Bill 2020: Royal Assent
  • Finance Bill 2021: Summary of first batch of policies
  • Licence renewals to come with a new tax check
  • AML: Anti-Money Laundering Zone 
  • Penalty upheld; don’t rely on the Scottish Revenue’s LBTT reminder
  • Court of Appeal: VW Kombi and Vauxhall Vivaro are cars not vans
  • Input tax disallowed on stocks taken in discharge of debt without enough documentation
  • Is a car hire with children’s car seat a single composite supply or multiple? ...More

Nichola's SME Summaries for June 2020

Links to all of June's newswires...More 

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