Hello
This week we have HMRC’s latest Employer Bulletin, an update on corporate reporting for medium-sized companies, and progress on the UK’s establishment of a corporate re-domiciliation regime.
A re-domiciliation regime would enable foreign-incorporated companies to change their place of incorporation to the UK while retaining their legal personality.
Consultation on re-domiciliation proposals in the UK started back in 2021. In late 2023, a panel of independent experts was put together to work on a specific proposition. Their report has now been published, strongly supporting the introduction of a two-way regime.
It is clear that there will be several complex and competing interests to consider including accounting, tax, company law, audit requirements, and creditor protection, to name only a few. The report contains extensive observations and detailed proposals but, of course, much more work will be required. It will be interesting to see how this pans out and we can expect further consultation.
Continuing with an international theme, one First Tier Tribunal (FTT) decision that we explored this week considered whether a deceased individual’s interest in properties in Malta was subject to UK Inheritance Tax. The executrix making the appeal said that applying the provisions of IHTA 1984 to her case was like “trying to eat soup with a fork”.
Do check out HMRC’s latest Employer Bulletin. Among several useful updates, it contains guidance on Real-Time Information (RTI) reporting over Christmas and a reminder that the deadline to pay Class 1B National Insurance under 2023-24 PAYE Settlement Agreements falls this coming week.
More news, cases and updates below.
Nichola and the Team
Your Virtual Tax Partner®: online PRACTICAL support for accountants, tax advisers BY accountants and tax advisers.
Quick News
Simpler corporate reporting consultation outcome
The Government has published a summary of responses to the 'Non-financial reporting review: simpler corporate reporting' consultation held earlier this year.
Support for corporate re-domiciliation regime
An expert panel, established by the previous Government, has published its report on establishing a corporate re-domiciliation regime. Further consultation is expected to move the proposals forward.
Employer Bulletin: October 2024
HMRC have published their Employer Bulletin for October 2024. We have summarised the key content for you, with links to our detailed guidance on the topics covered.
The Budget Responsibility Act 2024
The Budget Responsibility Act 2024 came into force on 15 October 2024. This creates a ‘fiscal lock’ that is designed to ensure that fiscally significant announcements made by the Government are subject to independent assessment and will not upset the financial markets.
Tax Cases
Maltese properties subject to UK IHT
In Marisa Lincoln v HMRC [2024] TC09306, the First Tier Tribunal (FTT) found that an interest in properties situated in Malta held by a deceased individual was subject to UK Inheritance Tax (IHT).
Reasonable excuse for late VAT returns
In Sandra Krywald v HMRC [2024] TC09312, the First Tier Tribunal (FTT) found that a taxpayer had a reasonable excuse for the late submission of VAT returns. She took reasonable care to avoid the failings of her advisers and HMRC.
Editor's Choice (subscribers)
CGT: Value shifting
What is value shifting? When do the rules apply and what are the implications?
Abolition of the FHL regime: Briefing
HMRC have published draft legislation and related notes detailing how the abolition of the Furnished Holiday Letting (FHL) rules in April 2025 will operate. We consider the practical impact of losing the FHL rules and provide some essential planning points.
Estates: Income Tax and Capital Gains Tax
How do executors deal with income and capital gains arising on the deceased’s estate? What allowances and reliefs are available?
CPD
CPD for lunch: Byte-sized chunks of lunchtime CPD (free for our Subscribers)
- NEW: CPD: Income Tax and Trusts
- NEW: Free Study Skills Session - Preparing for Your Tax Exams
- CPD: Change of basis periods: Transitional rules 2023-24 Returns
- How to run the most tax-efficient business 2024/25.
- Purchase of Own Shares: all the details.
- Anti-money Laundering Update and Firm-Wide Risk Assessment ...More...
Guides & Updates
Self-employed
Compare software for Making Tax Digital for Income Tax
UPDATE: Two additional software providers have been listed by HMRC as compatible for MTD for Income Tax.
Losses (sideways): Restriction for uncommercial trades
What is sideways loss relief? What restrictions apply? When do they apply? What is an uncommercial trade?
Conditionality: Taxi, private hire vehicles and scrap licenses
What is tax conditionality? Does this affect tax registration? The renewal of certain licences, to drive taxis and private hire vehicles or deal in scrap metal, is conditional on applicants confirming that they are appropriately registered for tax.
Directors & Companies
Loan relationships: Basics
What is a loan relationship? How are profits and losses made from loan relationships taxed? What is the difference between a trading and non-trading loan relationship? What could restrict relief under the loan relationship rules?
Loans to participators (Close Company toolkit)
What is the Corporation Tax treatment when a close company makes a loan to a participator (director-shareholder)? How do the 'bed and breakfasting' rules work? What are the concerns with MBOs?
Research & Development
Research & Development Tax Reliefs
UPDATE: What is R&D Relief? How does it work? Why does the size of the company matter? What is sub-contracted R&D? How do I write an R&D Repo
Employers
PAYE Settlement Agreements
What are PAYE Settlement Agreements? How do they work? What can be included?
Staff Suggestion Schemes
Employee suggestion schemes can provide tax-free benefits. How should they be structured? Who is eligible? How much can be claimed?
Capital allowances
Annual Investment Allowance (AIA): Related companies
What restrictions to AIA apply to companies? What does common control mean? When are companies related?
Disposal values & rules
What is a disposal for capital allowance purposes? What is the tax consequence of a disposal? What value needs to be accounted for on a disposal?
Private Client & Estate Planning
CGT: Holdover/Gift Relief (s.165/s.260)
UPDATE: Holdover Relief is available when an individual makes a gift to another person (individual or company). When is the relief available? What are the conditions that apply? What restrictions are there?
Investment bonds & tax
How are investment bonds taxed? What is an investment bond? What is a chargeable event gain and how is it calculated? How do notional tax credits work? How is top-slicing relief calculated? What is deficiency relief?
Penalties & Compliance
Sch 36 Information Notices
What is a Schedule 36 Information Notice? When can HMRC issue one? What rights does the taxpayer have when an information notice is issued? What penalties apply for a failure to respond to an Information Notice?
Discovery Assessments
When can HMRC issue an assessment outside of the normal statutory time limits? What conditions must be met? Can HMRC issue two alternative assessments for the same period? What are your rights of appeal and defences?
VAT News
Capital Goods Scheme
What is the VAT Capital Goods Scheme (CGS)? When do I use it? How does it work?
VAT fraud: What is the Kittel principle?
What is the VAT Kittel principle? What happens when the Kittel principle applies? What tests do HMRC and the tribunals apply? How can I protect my business?
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.
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 10 October 2024
- New evidence requirements for employment expenses
- Confirm HMRC agent codes by 8 November
- 2023-24 paper tax return easement
- One-to-many: Provisional returns and Gas Safe engineers
- Interim dividend taxed on payment
- Suitable for use as a dwelling
- Private Schools and VAT
- Only one DIY housebuilder VAT claim permitted
- MTD: Income Tax Pilot Tool UPDATE
- R&D: SME Tax Credit scheme UPDATE
- Childcare: Employer provision UPDATE
- Acting for a trust? Start here… UPDATE ...More
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