The Chancellor is holding his 2021 Autumn Budget on 27 October 2021. There has been much speculation in the media about what it might contain, but rather than join in we have reviewed various representations sent to HM Treasury by the professional bodies instead. What do they suggest for the budget?

The representations include changes to the Employee Ownership Trust rules, legislation to prevent the assignment and enforcement of loans subject to the loan charge, wider eligibility criteria for Enterprise Management Incentive (EMI) share option schemes and a proposed increase to the threshold for the Higher-Income Child Benefit Charge (HICBC). We will have to wait and see whether the Chancellor has taken on board any of these proposals.

We have more Q&A’s from last week’s Virtual Tax Partner Practical Tax Conference, including overlap relief and how advisers can check their clients’ entitlement ahead of the proposed change to tax basis periods, as well as the interaction of top-slicing relief and the HICBC. It's a good example of some of the challenges advisers face when completing tax returns for clients.

Speaking of tax returns, we noticed that HMRC has moved the online SA1 form to register for Self Assessment behind the government gateway. Agents can still register clients in this way, however it requires you to login first. The 5 October registration deadline for the 2020-21 tax year has now passed, but penalties for late registration can be avoided if the tax due is paid in full by 31 January 2022.

The Treasury has released a report, ‘Net Zero Review’, this week alongside Green Budget 2021 issued by the Institute for Fiscal Studies. Both are voluminous reports and the most we can ascertain from them is that new taxes will have to be introduced to pay for ‘net zero’, especially given the significant contribution that fuel and vehicle excise duty currently make to UK GDP. Perhaps Green Taxes are something else to look out for in next week’s Budget.

We have lots of cases this week covering a wide range of areas as well as some useful new guidance from HMRC on what it can and will do if you fail to pay your tax on time.

Lots more news, updates and CPD below.

Back soon, 

The Team @ www.rossmartin.co.uk

Your Virtual Tax Partner® online PRACTICAL support for accountants, tax advisers BY accountants and tax advisers.

Quick News (Freeview)

HMRC guidance for employment agencies
HMRC have issued guidance targeted at helping employment agencies and those using temporary labour reduce the risk of using a non-tax compliant umbrella company.

Fail to pay your tax and what might HMRC do? 
HMRC have recently published guidance on how they deal with taxpayers who do not pay tax that is owed. This includes how and when debt enforcement powers are used.

Making Tax Digital for Agents issue 18: September 2021 
HMRC have issued Making Tax Digital for Agents Issue 18 (September 2021). We have summarised the key content for you.

Expect new taxes to achieve Net Zero
The Treasury has released ‘Net Zero Review’ which warns businesses and households will face new taxes and levies for Britain to achieve net-zero decarbonisation. The loss of petrol/diesel tax revenues would have a singularly significant impact on government finances.

Editor's Pick 

Vtaxp Practical Tax Conference Q&A: Greatest Hits of 2021-22 & Tax Return Boot camps
The first Virtual Tax Partner conference ran during the week ending 15 October 2021. Day 2 of the conference included our shorter 'Greatest Hits of 2021-22' mini-slots and Tax Return boot camp sessions covering a variety of different topics.

Vtaxp Practical Tax Conference FAQ: Planning for a rise in Corporation Tax
In Day 2 of our Virtual Tax Partner practical tax conference, this week we covered 'Planning for a Rise in Corporation Tax'. It looked at who might be affected, how the Small Profits Rate and Main Rate interact with marginal relief and compared basic tax rates between running a company or staying as a sole trader.

VtaxP Practical Tax Conference Q & A: Demergers demystified
The Demergers Demystified session at the Virtual Tax Partner practical tax conference broke down a very complicated topic into manageable and meaningful chunks. It then followed up with a detailed case study and a step-by-step analysis of a capital reduction demerger.

Guides and Updates (subscribers)  

Self Assessment

Accounting periods and tax basis periods
UPDATE: Which date do I choose? Does it matter? Can I change my accounting date? 

Record keeping & tax: What, how and until when?
UPDATE: How long do your need to keep your books and records for tax? Record keeping for Income Tax, VAT, Corporation Tax. What if you lose your records?

Land and Property 

Incorporation: Property business/Buy to let
UPDATE: What reliefs can I claim if I incorporate my property business? What claims and elections do I need to make? What are the VAT and Stamp Duty Land Tax (SDLT) implications?  

Directors & Companies   

Purchase of own shares: Checklist (Masterclass)
UPDATE: A Checklist (Masterclass) for dealing with a Company Purchase of Own Shares.

How to gift your shares to the family
How can you gift your private company shares to members of your own family? What are the tax implications? What reliefs apply?

Private Client & Estate Planning

SRT: Statutory Residence Test
UPDATE: What is the statutory residency test? Why is it important and how does it work?

Devolved taxes

LBTT: Land and Buildings Transaction Tax (LBTT)
What is Land and Buildings Transaction Tax (LBTT)? What are the rules?

Welsh Income Tax 
Since 6 April 2019, Wales has been able to set its own Welsh Rate of Income Tax. 

Penalties & Compliance

Joint and several liability notices
NEW: An HMRC officer can issue a joint and several liability notice to an individual involved with companies that are in receipt of tax avoidance penalties. HMRC guidance has been updated to explain the provisions.

Penalties: Failure to Notify
UPDATE: What tax penalties apply if you fail to notify HMRC that you are chargeable to tax? Can they be appealed or reduced?

Tax Cases  

Transfer of UK business to Gibraltar was a transfer of assets abroad
In HMRC v Peter, Stephen and Anne Fisher [2021] EWCA Civ 1438, the Court of Appeal (CoA) adjudged the transfer of assets abroad provisions applied to the transfer of a UK business to a Gibraltar company for two of the three shareholders. The profits of the company were subject to Income Tax. 

 No aggregation of employments for NICs lower earnings limit
In Martin Joseph Long v HMRC [2021] TC8272, the First Tier Tribunal (FTT) held that two employments could not be aggregated for the purposes of the National Insurance Contributions (NICs) lower earnings limit. The employers were not carrying on business in association with each other. 

High Court finds that EBT is valid potentially costing millions
In Bhaur & Ors v Equity First Trustees (Nevis) Ltd & Ors [2021] EWHC 2581 (CH), the High Court denied a request to set aside an Employee Benefit Trust scheme on the grounds of mistake despite attempts by the offshore trustees to give 90% of the trust value to the NSPCC as default beneficiary. 

Late evidence causes R&D relief claim to fail
In Grazer Learning Limited v HMRC [2021] TC08282, the First Tier Tribunal (FTT) rejected an appeal against HMRC's denial of an R&D expenditure claim as the appellant's evidence was ruled inadmissible by the court on the basis that it was filed late and not shared with HMRC.

VAT Cases & Guides

Multiple DIY housebuilder claims permitted 
In Andrew Ellis and Jane Bromley v HMRC [2021] TC08277, the First Tier Tribunal (FTT) found that more than one VAT repayment claim could be made by DIY housebuilders during construction, despite HMRC’s policy to the contrary. 

Land & Property VAT (Subscriber guide)
An outline of the VAT treatment of some of the more common supplies of land and property.  

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 14 October 2021

  • Employer Bulletin: October 2021 
  • Agent update: October 2021 
  • 136 countries agree to global Corporate Tax reform
  • Pandora Papers: Issues for advisers
  • HMRC to stop benefit payments to Post Office card accounts 
  • VtaxP Practical Tax Conference Q & A: Running the most tax-efficient accounting practice...ever!
  • No IHT relief for donations to UKIP is justifiable discrimination
  • Ancillary property did qualify for CGT Private Residence Relief
  • Wages paid to Dad, not wholly and exclusively incurred
  • Land & Property: DIY Housebuilders scheme
  • Accountants fees
  • VtaxP Practical Tax Conference Q & A: Capital Gains Tax on selling up and moving on
  • VtaxP Practical Tax Conference Q & A: IHT planning for accountants
  • Conditionality: taxi, private hire vehicles and scrap licenses 
  • Transfer of assets and income streams through partnerships
  • Settlement anti-avoidance rules
  • Capital reduction: Tax treatment
  • Dividend tax index  ...More 

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