In July 2022, the government has published draft legislation as part of Finance Bill 2022-23, which sets out the planned reforms of the Research & Development (R&D) Tax Relief. As previously announced, the relief will be expanded to cover a wider range of expenditure and relief will be restricted in part to focus more on rewarding UK expenditure.
SME Tax News
The government has published proposals 'Pensions: relief relating to net pay arrangements' that allow HMRC to make a top-up for payments to lower-paid taxpayers who are within net-pay pension arrangements.
HMRC have opened a new consultation ‘Digitalising Business Rates: connecting business rates and tax data’. The aim is to join up tax and business rates data to improve compliance, better target policy, and enable businesses to better understand and review their tax liabilities by having them all in one place.
As part of ‘L-day 2022’, HMRC have published a policy paper and draft legislation to clarify the tax treatment of payments received under the Lump Sum Exit Scheme for farmers.
HMRC's 'L-day' policy paper, 'Capital Gains Tax: separation and divorce', proposes to extend the time limits for transferring assets at no-gain no loss between separating partners from the year of separation to the three following years, or, it will be unlimited if part of a formal divorce agreement.
Following a call for evidence, the government has decided not to move ahead with proposed changes to 'Income Tax Self Assessment (ITSA) registration for the self-employed and landlords'. Making taxpayers register early for taxes is likely to cause more problems than it would solve.
In Altan Goksu v HMRC [2022] TC08536, the First Tier Tribunal (FTT) allowed a deduction for capital losses brought forward despite no evidence that they had been notified to HMRC over twenty years earlier. The tribunal reduced the amount as it could not be supported by the taxpayer.
In SC Properties Limited and Richard Cooke v HMRC [2022] TC08537, the First Tier Tribunal (FTT) decided a property was sold by individuals not a partnership. As no partnership existed any CGT and SDLT relief that was claimed on its disposal was denied.
The Office of Tax Simplification (OTS) has published a new policy paper ‘OTS Review of tax simplification’ setting out what drives tax complexity and how officials making tax policy can work to prevent or mitigate that complexity.
HMRC have published their Report and Accounts and other documents for 2021-22. The accounts report revenues of £731.1 billion, a 20.1% increase since 2020-21, although 23.8% of this (£173.8 billion) remained unpaid at the year-end. Its audit was qualified due to high levels of error and fraud.