SME Tax News

This summer the government has announced its proposals to crack down on tax cowboys. So, how can you spot a tax ‘cowboy’ and do higher earners really care whose tax scheme they are using?

The government has announced new proposals to crack down on the promoters of contrived and aggressive tax avoidance schemes in order to save billions in tax.

In Coopers v HMRC [2012] UKFTT 439 (TC) TC 02120 a partnership was set up to provide cars to a company owned by the partners, who were also its directors in an arrangement aiming to avoid car benefit charge. The Tribunal found that the partnership was "little more than an extension of the company set up and operated in order to avoid or reduce income tax and a National Insurance charge for the company." In paying the partnership to provide cars which were used by the directors, the company was indirectly providing cars and fuel "by reason of employment" and so a tax charge resulted for the directors with Class 1A for the employer.

See Tax masterclass: running an LLP & Co structure for guidance on how to avoid a similar charge.

Graeme Nuttall, the government’s adviser on employee share ownership has published a report recommending that the UK should encourage more “John Lewis” type employee owned companies.

We are all a bit bored with banking sagas so this time we feature an Adviser Update on Land and Property matters together with updates on NICs and dividends, ABC shares and the Small Charitable Donations repayment scheme.

Journalists from The Times have been undercover exposing the tax avoidance industry. Even comedian Jimmy Carr took part in a Jersey tax saving "strategy" to pay just 1% in tax.

 

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