Hello,
This week we feature some really useful and practical guides and of course, all the latest news on government support during these difficult times. Welcome to all our new subscribers; May was a record month in terms of visitors.
HMRC has issued an agent update which is worth a read, and also its latest Employment-Related Securities bulletin answers many FAQs on share schemes issue that have arisen due to the current coronavirus crisis.
Last Friday we learned from HMRC that the introduction of the Construction Industry Scheme VAT domestic reverse charge will be postponed yet again, this time until 1 March 2021. When this scheme does start, there will be an additional requirement that the end client in the supply chain makes a notification of its status in writing.
As usual, we include our pick of tax cases that we think will interest you.These include the curious case of a discovery assessment (an assessment made out of normal assessment time limits) where the taxpayer appears to have deliberately 'sat on' his return in order to avoid a £5 million tax bill. The judge did not care for that tactic and upheld suitably punitive tax geared penalties. Another case details how HMRC exacted revenge on the purveyor of tax avoidance schemes by opening enquiries into all his companies and then using its bulk data-gathering powers in sch 23 FA 2011 to track down the firms that had been promoting the schemes and which had been paid client commissions. There is a useful judgment from the court of appeal on trust documentation and finally a topical case on trade loss relief.
Finally, a couple of reminders:
Do not overlook your timings for making any claims for government grants and funding. All claims are time-sensitive. See our COVID-19 tracker for updates. The government seems to think that the best time to make important announcements is late on Friday afternoon and so do check back again on Saturday.
It is time to complete form P11D in respect of any taxable employee benefits and expenses payments. If you have issued any Employment-Related Securities or share options in the past, these also need to be reported annually.
If you have any tax-specific queries, please post them up to our sister site, details are here: www.VtaxP.co.uk.
Back soon
Nichola Ross Martin FCA CTA (Fellow)
Tax Director
Your Virtual Tax Partner® online PRACTICAL support for accountants, tax advisers BY accountants and tax advisers.
Quick News
HMRC's Agent Update June/July 2020
We have summarised the key content for you with links to our detailed guidance on the topics covered.
Employment-Related Securities: What’s New? June 2020
HMRC's latest Employment Related Securities Bulletin focusses on the impact of COVID-19 on employee share and incentive schemes. Here is our enhanced version.
COVID-19: Tracker
UPDATE: Start here to track the latest government measures and announcements aimed at supporting businesses and individuals during the pandemic.
COVID-19: Construction Industry Scheme VAT delay
Delayed again: HMRC have announced a postponement to the introduction of the domestic reverse charge for construction services until 1 March 2021 due to the impact of the Coronavirus on the construction sector.
Editor's Pick (subscribers)
Trusts & Tax planning
UPDATE: What is a trust? How can trusts be used in tax planning? What the advantages and what are the pitfalls?
Directors' Tax Planning toolkit
UPDATE: Our planner is a tax essential for all directors, it covers remuneration, profit extraction, share based transactions and anti-avoidance rules.
Self-Employed: Different Trades
UPDATE: Looking at special rules and what expenses can different trades, professions and vocations claim.
Tax Guides and Updates (subscribers)
HMRC's Information powers: at a glance
UPDATE: A handy briefing note for business owners and clients.
Discovery Assessments
UPDATE: When can HMRC issue an assessment outside of the normal statutory time limits? What conditions must be met? What are your rights of appeal and defences?
Schedule 23 Data Gathering Powers
Schedule Finance Act 2011 Data Gathering Powers: Who is a data holder and what information may HMRC request from them?
SDLT: Residential property higher rates
UPDATE: A guide to the Stamp Duty Land Tax (SDLT) higher rate charge on residential property, when it applies and what reliefs are available.
SDLT: Multiple Dwelling Relief and annexes
What is Multiple Dwellings Relief (MDR)? When does it apply and how is it claimed?
Case Update (Freeview)
Discovery not stale: Taxpayer's delay was intentional
In Peter Marano v HMRC [2020] TC7685, a US citizen who delayed reporting £20million in capital gains was unsuccessful in persuading the First Tier Tribunal (FTT) that HMRC's knowledge of his inaction rendered its subsequent discovery assessment as 'stale'.
HMRC tracks tax scheme promoters
In Qubic Tax and others v HMRC [2020] TC7701, HMRC successfully made information requests on tax advisers selling and engaging in tax avoidance schemes in order to check on commission payments made to introducers and the validity of the tax schemes.
Poor documentation fails to bring about lack of trust
In Michael Hamilton Bowack and Ann Jennifer Bowack v Claire Vera Saxton [2020] EWHC(Ch) 1049, the High Court found that discretionary trusts were validly set up despite serious defects in the documentation.
No enquiry, no closure notice, no jurisdiction
In Salman and Asma Tufail [2020] TC7691, the First Tier Tribunal (FTT) dismissed appeals against HMRC’s refusal to allow late claims for trade loss relief. No enquiry had been opened so it did not have the jurisdiction to consider the refusal.
Virtual Tax Partner Toolkits (freeview)
Virtual Tax Partner © Tax Toolkit© Tax Toolkits
NEW: be a winner with our game-changing tax diagnostics tools. Sign up now.
- Entrepreneurs' Relief: Sole traders: sale of a business, incorporation, sale of assets
- Entrepreneurs' Relief: Company owners: rules for sales pre 29 October 2018, sales between 29 October 2018 and 5 April 2019 and after.
- TAAR: closing your Personal service company? Will your final dividends be taxed as income?
- Salary or dividend, or a mixture of both. Better to claim the Employers' Allowance?
- Making Tax Digital for VAT: when do you need to join.
Tax Queries?
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 very wide range of expertise: covering direct and indirect tax, as well as accounting, R&D claims, reorganisations and much more.
CPD for lunch
Byte-sized chunks of CPD for subscribers
NEW
More at CPD Index
Missed last time's Web-update?
Nichola's SME Tax W-update 4 June 2020
- COVID-19: Tracker
- COVID 19: Business Income Manual, changes to trading activities
- COVID-19: Discretionary Grant Fund
- Coronavirus Employee Job Retention Scheme
- COVID 19: Extension of Self-Employment Income Support Scheme
- Taxation of COVID-19 support payments
- COVID-19: Landlords & tenants
- Purchase of own shares not part of share sale
- Directors share options were 'by reason of employment'
- Annexe not a separate dwelling for SDLT
- Flat with flammable cladding remained a dwelling for SDLT
- Employment-Related Securities & share schemes
- Reorganisations: Case Study 6...More
Nichola's SME Summaries for May 2020
Links to all of May's newswires...More
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