Nichola's SME Tax w-update 5 August 2016

Hello 
This week has seen HMRC finally release a little more information on the recent changes to the Transactions in Securities rule, in particular the new 'phoenixing' TAAR. 
 
There is no clearance procedure for the TAAR, and HMRC are aware that, along with the potentially wide drafting of the legislation, this is creating uncertainty.  They've therefore set out some very limited examples in a letter to the CIOT.  These don't give much away, so many will still be left eagerly awaiting the formal guidance.
 
In other news the OTS has released a couple of new consultations on small company tax reform, and HMRC have reiterated that they will be taking a tough line on Managed Service Companies.  It seems that their recent success in the first ever case considering these rules may have gone to their head!
 
We've also got some case round-ups, and new guides on the rather diverse topics of market gardening and the treatment of insurance premiums / payouts.

Last week...we did not send out an email for the newsletter. Please see links to it below.
 

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Nichola Ross Martin FCA Tax Director

www.rossmartin.co.uk

Your Virtual Tax Partner®: online PRACTICAL support for accountants & tax advisers BY accountants & tax advisers

Quick news (freeview)

Spotlight 32: Managed Service Companies
NEW: HMRC spotlight issued on MSC arrangements following their recent success at the First Tier Tribunal.

Small company tax reform: further OTS discussion
The Office of Tax Simplifiation have published discussion papers on Lookthrough Taxation and Sole Enterprise with Protected Assets. 

HMRC phoenixing examples
HMRC have provided their first examples showing how they might apply the new targeted anti-avoidance rule (TAAR) to combat "phoenixing" which was introduced by Finance Bill 2016.

Case Update

Discovery assessment: death is no escape
In The Personal Representatives of Michael Wood v HMRC [2016] UKUT 0346 the Upper Tribunal (UT) has held that a discovery assessment does not have to be set aside just because the taxpayer has died.

Backdated VAT registration refused
In Max Investments Ltd v HMRC [2016] UKFTT TC05063  an application to backdate VAT registration was refused following confusion as to whether construction costs were goods or services.

Tax scheme user not fraudulent or negligent
In Anthony Bayliss v HMRC [2016] UKFTT TC05251 a taxpayer who used a tax avoidance scheme was found not to be acting fraudulently or negligently after relying on professional advice.

Practical Tax Guides & Updates 

Appeal: mistake by an adviser
UPDATED: case of Daniel Daly v HMRC [2016] TC05248 added: taxpayer couldn't rely on advice that gifts are not taxable since the FTT found the payment was not a gift. 

Transactions in securities: case studies
UPDATED: Now includes HMRC's new guidance as to how the Targeted Anti Avoidance Rule for phoenixing might apply.

Insurance: deductions and receipts
NEW: A note outlining when businesses can claim a trading deduction for insurance premiums and when receipts are taxable.

Market Gardening
NEW: When is land occupied for market gardening rather than for farming?  The Upper Tribunal recently considered this in detail in Judith Thorne v HMRC [2016] UKUT 0349.

CPD 'for lunch'

Bite-sized chunks of structured CPD

Trivial benefits
NEW: a run through of the new statutory exemption together with worked examples.

Savings income 2016/17
NEW: our webcast takes you through the new allowances with worked examples

VAT essentials for start-ups
NEW: this is part of the talk from Accountex. Don't ignore VAT when you start in business, you may regret it in later years. 

Editor's choice  

Accountants: are you an MSC Provider?
Care must be taken that offering  ‘one stop shop’ services to clients does not mean you inadvertently fall foul of the Managed Service Company anti-avoidance rules.

Transactions in securities (signpost)
Links to all our guides on TIS and related issues.

Travel: self-employed
Those fiendishly complex rules summarised together with a table of case law and analysis for different trades and occupations.

Creating an office at home: directors
What expenses can you claim when your work from home or convert part of your home to be your office?

Missed last time's update?

Nichola's SME Tax Update 29 July

Features:

  • Finance Bill delays
  • Pensions lifetime allowance protection
  • Common Reporting Standard
  • CGT and lost property deposits
  • Audit Thresholds
  • Buy to let: SDLT on partnership incorporation
  • VAT: single or multiple supply?
  • Penalties: how to appeal and errors in returns and documents
  • Restricting mortgage interest relief

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