We have our usual eclectic mixture of news and features this week. Mostly, our updates are inspired by the queries coming in to our sister Virtual Tax Partner service.

Many people’s eye’s glaze over at the mention of ‘Transactions in Securities’ (TiS), these are anti-avoidance measures that allow HMRC to block Capital Gains Tax (CGT) treatment in certain situations when shareholders cash in their shares. We have seen a couple of cases this week where the TiS has caused some most unexpected results for advisers and meant that what was advised is simply not going to work as intended. The problem, for most of us, is that the kind of cases which involve the TiS also generally involve a whole raft of other different tax and accounting considerations. It can be extremely difficult to identify every single issue in a complicated tax case. In terms of risk, who ever scores 100% in a tax exam? My conclusion is that if a case involves anything to do with share capital, budget to spend at least three times as long as you first thought on it and then you might get nearer to being 100% correct in your analysis.

We have a new consultation on Research & Development (R&D) relief which is worth a read, and by coincidence, we look at a case where a company failed to show that its expenditure qualified. 

We are also continuing our review and update of our guides to trusts, and we have a new guide on how to wind up a trust.

If you have any tax-specific queries, please do 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

Support for deferring students
The government has put together a package of support for students who had planned to study this year but are deferring their place. 

COVID-19: Three-month extension for SAO filings
Companies House is temporarily extending the accounts filing deadline for companies filing accounts from 27 June 2020 to 5 April 2021 (inclusive). 

COVID-19: Temporary remote witnessing for wills
From 28 September 2020, a temporary amendment to the Wills Act 1837 will come into force allowing wills in England and Wales to be witnessed remotely by ‘videoconference or other visual transmission’.

Consultation: The scope of qualifying expenditures for R&D Tax Credits 
HM Treasury have opened a new consultation ‘The scope of qualifying expenditures for R&D Tax Credits’ is seeking views on what costs that companies can include in R&D tax credit claims and whether they should be updated to reflect modern trends in R&D.

R&D relief and furloughed workers
HMRC have published new guidance on how companies claiming Research and Development (R&D) relief should treat staff costs where workers have been furloughed under the Coronavirus Job Retention Scheme (CJRS).

Editor's Pick

Transactions in Securities (signpost)
The Transactions in Securities (TiS) rules are anti-avoidance rules. When triggered a profit or gain is taxed as income, denying any generally more favourable Capital Gains Tax treatment.

Case study: demerger of investment business from a trading company
A trading company has acquired or built up now significant investment assets/investment business. It now wants to separate out the trading activity from the investment activities. What are its options?

Guides and Updates (subscribers)

Trusts & Estates: Exit charge reporting requirements
What is an exit year charge (or proportionate charge) and when does it apply?

How to wind up a UK trust
What are the tax implications of winding up a trust? What do I need to do as a trustee to wind up a trust? Why wind up a trust?

R & D Zone: take a tour!
R&D Zone aims to provides you with practical know-how and support in putting together an R&D claim, When can I make an R&D claim? How can I claim R&D? What is R&D? What expenses qualify for R&D? 

Case Update (Freeview)

Trustees granted extra powers to allow for IHT planning
In Cotterell & Anor v Allendale & Anor [2020] EWHC 2234, the High Court agreed to grant additional powers to the trustees of a family settlement for the purposes of Inheritance Tax planning.

R&D relief denied for lack of credible evidence
In AHK Recruitment Ltd v HMRC [2020] TC7718, the First Tier Tribunal (FTT) denied claims of SME R&D relief. The conditions for relief were not met as there was no evidence of an advance in science or technology.


Withdrawal of the VAT Retail Export Scheme
The government has announced the withdrawal of the VAT Retail Export Scheme (RES) from non-EU visitors and no extension to EU visitors.

Current vacancies

Tax writer and editor job opportunities
We are closing our current round of recruiting. Thank you very much for your CVs, we are working through each one. 

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 10 September 2020

  • Spotlight 56: Disguised remuneration
  • New grants for local COVID lock-down businesses
  • 6,000 in race to settle EBT loans
  • Selling the business: Deferred consideration and earn-outs
  • Gift Aid carryback must be via an original tax return
  • Presumption of continuity did not apply when trade changed
  • Call for Evidence: VAT Grouping, Establishment, Eligibility, and Registration...More

Nichola's SME Web-Updates for August 2020

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

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