Hello,
This week we explore HMRC’s latest Agent Update, discrepancies with corporate losses, a new report on Anti-Money Laundering (AML) supervision and clarifications to the legal status of digital assets.
The Property (Digital Assets etc) Bill has recently been introduced to Parliament. This aims to clarify that certain digital assets, including cryptocurrency, can attract personal property rights at law and should provide enhanced legal protection to the owners of many such assets.
On the introduction of the Bill, the Justice Minister, Heidi Alexander, observed that it is essential that the law keeps pace with evolving technologies. Of course, this necessity to keep pace is also true for businesses and tax compliance in general.
In this vein, the Chancellor announced that HMRC will soon launch a consultation on electronic invoicing (e-invoicing) to promote its wider use and reduce fraud. It was also announced that we can expect a ‘Digital Transformation Roadmap’ to be published, which will set out HMRC’s vision to be a ‘digital first’ organisation.
We hope that digitalisation improves the experience of taxpayers and agents alike. The Administrative Burdens Advisory Board’s 2023–24 report, also published this week, highlights concerning negative trends in HMRC’s helpline response times and the usefulness of communication channels.
In other news, HMRC has released its latest Agent Update. Do note the updated bank details for some taxes and levies, and that if you have Self Assessment income to declare for 2023-24, the deadline for notifying HMRC is 5 October 2024. Late notification penalties are applied.
More news and cases below.
Nichola and the Team
Your Virtual Tax Partner®: online PRACTICAL support for accountants, tax advisers BY accountants and tax advisers.
Quick News
Agent Update: September 2024
HMRC have published their Agent Update for September 2024. It includes several changes in HMRC banking details, a new allowance for Neonatal Care and VAT compliance notes. We have summarised the key content with links to our detailed guidance on the topics covered.
Discrepancies with corporate losses
HMRC are writing to companies and their tax agents where they have identified inconsistencies between CT600s and the accompanying tax computations, relating to corporate losses.
Clarifying the legal status of digital assets
The Property (Digital Assets etc) Bill has been introduced to Parliament aiming to clarify the law surrounding digital assets, including cryptocurrency.
Chancellor unveils part of new HMRC package
The Chancellor, Rachel Reeves, has revealed a strong appetite for making major reforms to the UK’s system, starting with a review of electronic invoicing (e-invoicing) as one method to reduce retail fraud.
ABAB report finds worsening customer experience with HMRC
The Administrative Burdens Advisory Board (ABAB) has released its 'Tell ABAB report 2023 to 2024'. This demonstrates a lack of awareness around Making Tax Digital (MTD) for Income Tax, poor channels of communication with HMRC, and a worsening 'customer experience'.
Supervising bodies inconsistent on AML oversight
The professional bodies supervising anti-money laundering enforcement amongst their members have been told by the Office for Professional Body Anti-Money Laundering Supervision (OPBAS) that improvements need to be made. While most Professional Body Supervisors (PBSs) comply with the regulatory requirements, "pockets of ineffectiveness remain".
Tax Cases
Defeated by Double Tax Treaty Tie-breakers
In Kevin McCabe v HMRC [2024] UT 280 a taxpayer’s plan to move abroad to avoid UK tax failed when the Upper Tribunal ruled him UK resident according to the tie-breaker clauses in a Double Tax Agreement (DTA).
TalkTalk loses prompt payment discount VAT appeal
In TalkTalk Telecom Limited v HMRC [2024] UKUT 00284, the Upper Tribunal (UT) found that supplies were not made on terms allowing a discount for prompt payment. VAT was chargeable on the invoiced amount.
Four years to resolve Alternative Dispute Resolution agreement
In Andrew Quay Hull LLP v HMRC [2024] TC09291 the appellants' three-year battle against a VAT penalty assessment four years after an Alternative Dispute Resolution (ADR) agreement was finally resolved.
Editor's Choice (subscription content)
Cryptoassets: How are Bitcoin, cryptocurrencies or cryptoassets taxed in the UK?
How do you tax Bitcoin? Are cryptocurrency or cryptoasset gains or profits, taxable? Can you obtain tax relief if you make losses on Bitcoin? Gains on transactions in cryptoassets are potentially taxable in the same way as other investments.
Trust Registration Service
What is the Trust Registration Service? What trusts does it apply to? What are the requirements and deadlines?
Artificial Intelligence (AI) and your tax practice: the story so far
A briefing for our subscribers who would like a bit of an insight into what we think about Artificial Intelligence (AI), its limitations and thoughts on our future plans.
Guides & Updates
Self-employed
Averaging claims
When can profits be averaged? What trades do averaging apply to? How are averaging adjustments calculated and made?
Basis Period reform
What is basis period reform? Who is affected? What is the new basis year for tax? What are the transitional rules?
Directors & Companies
Loan relationships: Connected Companies
How do the loan relationship rules apply to connected companies? What are the special rules? When do they apply? What are the exceptions to the special rules? What are deemed releases?
Companies: Tax Registration Checklist
UPDATE: Our new version covers Non-resident companies, and unincorporated associations too.
Research & Development
R&D: Additional Information Form (AIF)
NEW: What is an Additional Information Form (AIF)? When is a company required to submit an AIF? What information should be included in an AIF? How do I submit an AIF?
R&D Zone: Overheads and indirect activities
UPDATE: What costs are eligible for R&D relief? Do overheads and indirect activities qualify?
R&D: Advance Assurance
UPDATE: What is Research and Development (R&D) Advance Assurance? How can I apply? What are the conditions? What are the benefits?
R&D: Capital allowances
UPDATE: What are R&D capital allowances? When can they be claimed and how do they work?
Land & Property
Property Profits & Losses: Toolkit (2024-25)
Our Property Profits & Losses toolkit takes HMRC's version as its starting point and adds a great deal more information about what you can claim as an individual landlord.
Employers
Employee Shares: Restricted Stock Units: tax reporting
How to report Restricted Stock Units for UK tax. I am an employee and my employer has granted me stock units or RSUs. How are they taxed? How do I complete my tax return?
CIS: Contractors and Subcontractors
What is the Construction Industry Scheme? Who does it apply to? How does it work?
Private Client & Estate Planning
Do I have to file a tax return?
When does an individual need to file a tax return? In what circumstances do HMRC need to be notified that a tax return is required?
Non-resident trusts
When is a trust non-resident? What are the UK tax implications of a non-resident trust? What are the UK tax implications for any beneficiaries? What are the UK administrative requirements for a non-resident trust?
Penalties & Compliance
Economic Crime Levy
The Economic Crime Levy is a fixed fee paid by medium and large-sized entities that are subject to Money Laundering Regulations. This will include accountants, auditors and tax advisors. Registration, filing and payment are due by 30 September.
Materiality and tax
What is materiality and how does it apply to tax?
VAT News
Energy-Saving Materials
The supply and fitting of energy-saving materials in residential accommodation attracts the zero rate of VAT. What does it apply to? What are the qualifying conditions? What case law is there on this topic?
Capital Goods Scheme
What is the VAT Capital Goods Scheme (CGS)? When do I use it? How does it work?
Tax Tools & Calculators
Tax tools & calculators
UPDATE: 2024/25 versions available now. We have a suite of useful tax tools that help agents, business owners and sole traders calculate their taxes.
Calendar of tax deadlines and new tax measures
UPDATE: This is a freeview 'At a glance' rolling calendar of common recurring tax deadlines, new tax measures and other tax-significant events.
CPD for Lunch
Byte-sized chunks of lunchtime CPD for subscribers
- NEW: Free Study Skills Session - Preparing for Your Tax Exams
- CPD: Change of basis periods: Transitional rules 2023-24 Returns
- CPD: VAT Penalties Update
More at CPD Index
Tax Queries?
UK Agent for registration of Overseas Entities
Do you require assistance in the registration and verification of an overseas entity that owns UK land or property?
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 wide range of expertise: covering direct and indirect tax, as well as accounting, R&D claims, reorganisations and much more.
Missed the Last Tax Update?
Ross Martin Tax: SME Tax News 19 September 2024
- Tipping Act comes into force
- R&D Claim Notification Due 30 September 2024
- HMRC analysis shows employment up, EU workers down
- Welsh Budget date set for 10 December 2024
- Scottish Budget date set for 4 December 2024
- The Budget Responsibility Act 2024
- Referees' employment status nearly sorted
- Fishery business fails to net BPR
- No relief for IP amortisation
- Failure to take proper tax advice was careless ...More
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