Nichola's SME Tax W-update 25 March 2021

Hello

The government published more than 30 tax updates, consultations and other documents this week. These are in addition to the announcements made earlier this month in Budget 2021. As the new documents cover a diverse range of topics, we have picked out some of the highlights and will continue reviewing the other proposals in the coming weeks.

Included in the new publications are several ‘Calls for Evidence’, and we start our review by looking at proposals to make changes to Tax Administration Framework and Tax Payments. This is a time when anything is possible, so why not make some wide-ranging reforms across HMRC's systems? You can make your views known on the document link below. Quarterly reporting under Making Tax Digital for Income Tax and Corporation Tax will soon enable businesses to make more accurate estimates of their tax liabilities, and therefore government is looking to increase the frequency of tax payments made during the year.

Tax advisers who are not registered with a professional body might be interested in the new consultation on 'Raising standards in the tax advice market'. In short, some advisers will have to be registered or licenced with HMRC which will in turn impose certain requirements on them. One proposal is that tax advice cannot be given without the adviser having sufficient professional liability insurance. 

There is some bad news for those who have not yet settled their disguised remuneration loan charges with HMRC.  It has announced that it will soon be issuing new tax and penalty determinations. There is no appeal mechanism for these determinations which create enforceable tax debts. Contractors who have so far buried their heads in the sand and ignored the loan charge will now have to take corrective action.

On a brighter note, we have lots of useful updates and new end of year checklists for subscribers. If you do not want to subscribe but want to access an individual guide you can purchase these via our Tax Tools section. 

If you have any queries do post them on our sister site, the Virtual Tax Partner advice service at www.VtaxP.co.uk scroll down for more news and updates.

Back soon 

Nichola Ross Martin FCA CTA (Fellow)
Tax Director

www.rossmartin.co.uk

Your Virtual Tax Partner® online PRACTICAL support for accountants, tax advisers BY accountants and tax advisers.

Quick News

No Appeal: New Loan Charge Determinations & Penalties
In a recent agent webinar HMRC advised that they will soon be issuing determinations of Income Tax and NICs to taxpayers affected by the loan charge who have failed to include the charge on a 2018/19 Self Assessment return.

Consultation: Raising standards in the tax advice market 
HMRC has published a consultation on the requirement for anyone providing tax advice to hold professional indemnity insurance. The consultation will also consider the definition of tax advice. The consultation will close on 15 June 2021.

Chancellor responds to the first OTS report on IHT 
The Financial Secretary to the Treasury has written on behalf of the Chancellor to the Office of Tax Simplification (OTS) in response to the first report on Inheritance Tax. The response details two new measures announced.

Consultations 

Call for evidence: Tax administration framework  
HMRC have published a Call for Evidence entitled ‘The tax administration framework:  Supporting a 21^st century tax system’.  HMRC seeks views on how the tax administration framework could be reformed to provide a better experience for individuals and businesses with a view of reducing the tax gap and providing flexibility to adapt.

Call for evidence: Timely payment  
A new call for evidence about the timely payment of Corporation tax by small companies, and Income tax. It seeks views on the opportunities and challenges of introducing in-year calculation and payment of these taxes.

Tackling Disguised Remuneration Tax Avoidance: Summary of responses
HMRC have published a summary of responses to their call for evidence: ‘Tackling Disguised remuneration tax avoidance’ where the government sought views on what drives the continuing use of Disguised remuneration schemes, and what further action they might take to deal with them.

SITR: Responses to call for evidence
HM Treasury have released a summary of the responses to their Call for Evidence on Social Investment Tax Relief (SITR). 

Editor's Pick 

Tax Returns: To-do list before/after 5 April 2021  
What tax returns and claims are due before the end of the tax year?  What are my tax filing requirements? This is a checklist of key deadlines for SMEs and their owners. 

Year-end top tips for OMB's 2020/21
Last-minute year-end tax planning advice for owner-managed businesses and clients. What should you focus on as the 2020-21 tax year-end approaches? What should you do before 5 April and what could you leave until later?

Directors: Tax planning toolkit for 2021/22 
This planner looks at a range of director tax issues, including company profit extraction.

Tax-efficient extraction of profits: toolkit (2021/22) 
NEW: This toolkit is designed to help a company and its owner decide how company profits are to be extracted.

Guides and Updates (subscribers)

Savings income: tax on interest
UPDATE: What is savings income? How is savings income taxed? What allowances are available?  

Dividend tax (subscriber guide)
UPDATE: This practical tax guide explains how dividends are taxed on or after 6 April 2016. It includes HMRC's own examples, more detailed examples, including an Owner Managed Business (OMB) section together with tax planning tips.

Property profits & losses: Toolkit (2021-22) 
NEW: Our Property profits & losses toolkit takes HMRC's version and adds a great deal more information about what you can claim as an individual.

CGT Reporting: How to report Capital Gains
There are different ways that you either can or must report your capital gains depending on whether you are resident, or non-resident and whether you are in or out of Self Assessment.

VAT News 

COVID-19: Option to tax deadline extended
UPDATE: HMRC have announced that they are extending the deadline for notifying them about an option to tax on land and buildings to 90 days due to the Coronavirus pandemic.

VAT Updates

CIS: Construction Industry reverse charge
What is the CIS reverse charge? How do you account for VAT? Can you still cash account for VAT? What administrative changes do I need in order to operate the reverse charge? 

Car or Van for VAT?
What is a car for VAT? What is a van for VAT? What VAT can be recovered on a car that is bought? Leased? What about fuel? Or mileage reimbursements? 

Tax Toolkits 

Tax Tools
Be a winner with our game-changing tax diagnostics tools. These original tax diagnostic tools aim to help you solve some really complicated tax questions in a matter of minutes. Each tool is designed to save you approximately two to six hours of time. These can be purchased separately, they cover:

• Business Asset Disposal Relief
• TAAR on winding up
• Company reorganisation 
• R & D Claims

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

• CPD: CIS Reverse Charge VAT
• CPD: Trading Loss Relief: Individuals
• CPD: Business Property Relief
• CPD: Furnished Holiday Lettings

More at CPD Index

Missed last time's Web-update?

Nichola's SME Tax W-update 18 March 2021

• Deadline extension for Trust Registration Service
• Late filing penalties: HMRC to allow bulk appeals
• R & C Brief 3 (2021): VAT liability of digital publications update
• Budget 2021: Help to Grow
• Budget 2021: Freeports
• Annual Tax on Enveloped Dwellings (ATED): At a glance
• ATED returns: Daily penalty notices invalid as issued too late
• LLP Profit reallocation scheme fails (2)
• Not plant: underground gas storage cavities
• SDLT: Annex not a separate dwelling
• Year-end top tips for OMB's 2020/21
• Property profits & losses: Toolkit (2020-21)
• Salary 2021/22 (avoiding NICs) 
• Do I pay a salary or dividend? 2021/22  ...More

SME Tax Monthly Summary February 2021

Links to all of February's newswires...More 

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