Now that the Finance Act has become law, we are able to bring you some more detailed tax updates. This week we have our ever-popular 'Employer's What's On' for 2021-22.

There is a surprising number of changes this year for both employers and employees to note, and some oddities too. Some employers may might want to consider how they are accounting for the cost of equipment reimbursed to employees over the COVID-19 lockdown. If there is no transfer of ownership to the employer of an asset purchased by an employee it should not be capitalised. Will a bookkeeper realise this? Also, there is no P11D benefit if the employee retains ownership of the equipment, as they owned it all along. For employees, an important deadline is approaching. EU, EEA and Swiss citizens and their family members, who were resident in the UK by 31 December 2020, need to apply to the EU Settlement Scheme by 30 June 2021. HMRC has said that it will accept late claims.

Following a review of the tax year-end by the Office of Tax Simplification (OTS), we have opened a poll. Should we change the tax year-end? If so, then should it change to 31 March or 31 December. Whilst our team seem to be perfectly divided on the matter, it looks, at least according to the results so far, that retaining the 5 April is the least popular option. What do you think? Have your say via the poll.

On cases this week, there is an interesting conclusion to an appeal against the Partnership Mixed Membership rules that will be sure to interest many business partners and their advisers, and a bad but entirely predictable outcome for the Royal Opera House in its VAT partial exemption claim.

More guides and updates below.

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

Changing the tax year-end: is that a good thing?
Take part in our Poll

Calendar of tax deadlines 
NEW: A useful 'At a glance' rolling calendar of common recurring tax deadlines. Covers critical dates for agents, employers, the self-employed and the construction sector.

Use of home as an office: Calculator
What costs can I claim when working from home? How do I calculate my claim? What restrictions should I apply?

Agency workers: At a glance
What is the tax treatment of workers supplied through UK-based agencies, employment businesses or other staff supply intermediaries?

COVID-19: Coronavirus Job Retention Scheme (CJRS) from 1 November 2020
What is CJRS? When does the CJRS apply? How to claim CJRS. How to calculate CJRS claim amounts.

Marriage Allowance (Transferable Married Couples Allowance)
A freeview 'At a glance' guide to the Marriage Allowance, who can claim and how to make a claim.

Editor's Pick  

Employer's What's On: June 2021
NEW: A Finance Act 2021 employer update for advisers and their clients including our detailed guides. 

How to add www.rossmartin.co.uk as a shortcut on your phone
Low tech solutions: you don't need an App to access our mobile site.

Guides and Updates (subscribers) 

Termination, redundancy and leaving payments
UPDATE: How are redundancy and termination payments taxed? What amounts can be paid tax-free? What amounts are taxable as earnings?

CIS: Contractors and Subcontractors
UPDATE: What is the Construction Industry Scheme? Who does it apply to? How does it work? Finance Act 2021 update.

Off-Payroll Working: PSCs & Public Sector Engagers
UPDATE: The 'Off-Payroll Working' rules move IR35: the responsibility to assess a worker's employment status and to deduct Pay-As-You-Earn (PAYE) and National Insurance Contributions (NICs) from a worker's fees, away from the worker's company to the End-Client in the labour supply chain.

Directors: Tax planning toolkit for 2021/22
UPDATE: This planner looks at a range of director tax issues, including company profit extraction. 

SDLT: Non-residents' surcharge
UPDATE:Non-UK residents will be subject to an additional 2% Stamp Duty Land Tax (SDLT) surcharge on the acquisition of residential property in England or Northern Ireland from 1 April 2021.  

Tax Cases 

£19m Company profits reallocated to individual  
In Nicholas Walewski v HMRC [2021] UKUT0133, the Upper Tribunal (UT) dismissed an appeal against the First Tier Tribunal (FTT) decision which attributed LLP profits of a corporate member to the individual member for tax purposes.

CA upholds no direct link between opera and catering for input VAT 
In Royal Opera House Covent Garden Foundation v HMRC [2021] EWCA Civ 910, the Court of Appeal (CA) upheld the Upper Tribunal's (UT) decision that there was no direct and immediate link between Opera production costs and the sale of food and drink that would allow the input VAT on the former to be deductible.

VAT News & Guides

EU VAT e-commerce package: From 1 July 2021 
NEW: On 1 July 2021 a number of European Union (EU) VAT changes take effect, including the introduction of two new One Stop Shops. What are the changes? Who is affected? 

Place of supply: Mini One Stop Shop (MOSS)
The place of supply of B2C digital services is where the customer is based. Where supplies are made to the EU, this can mean multiple VAT registrations are required. How does MOSS assist with this? What is the position post-1 January 2021? 

Online Marketplaces: Selling goods in the UK
When do you have to register for UK VAT? When is UK VAT payable? What amount is VAT payable on? What information do you have to give the marketplace provider? What will it do with that information?

Private use of goods: VAT and Lennartz
What is the Lennartz mechanism? How does the Lennartz mechanism assist businesses in accounting for the VAT effect of the non-business use of goods?   

Reclaims and unjust enrichment
When can VAT reclaims be made? What are the time limits? What is unjust enrichment? Why might unjust enrichment prevent HMRC making VAT repayments?

Tax Toolkits 

Tax Tools
Be a winner with our game-changing tax diagnostics tools for Business Asset Disposal Relief, SDLT & annexes/subsidiary properties, Company reorganisations, R & D Zone and TAAR on winding up. Sign up now!

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 17 June 2021 

  • Finance Bill 2021: Royal Assent 
  • Agent Update: June 2021
  • HMRC relaunch agent dedicated line
  • Slight drop in Corporate Criminal Offences figures
  • Spotlight 58: Unfunded pension arrangements
  • SEISS reporting errors cause Self Assessment delays
  • Loan write-off neither allowable nor loan to participatory 
  • Upper Tribunal confirms IR35 applies to PSC 
  • Deferred your VAT? Take action now
  • HMRC to cancel direct debits if no email address 
  • R & C Brief 9 (2021): VAT liability of daycare services supplied by private bodies in England and Wales
  • Super-deduction & First Year Allowances
  • MTD for Income Tax Pilot Tool
  • Construction Industry Scheme (CIS)
  • CIS: False registration penalty
  • Disguised remuneration loan charge
  • COVID-19: Taxation of Coronavirus support payments  ...More

SME Tax Monthly Summary May 2021

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

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