Nichola's SME Tax W-update 21 April 2022

Hello

It’s been a quiet week in terms of tax news; we have a new HMRC Employer Bulletin and new VAT scale charges for the new year. We have been continuing to update our key guides for the new tax year, and we feature a few more this time.

If you are starting in business would I advise you to set up as a company or a sole trader? Your choice largely depends on your aims and ambitions. These days, the tax advantages and disavantages of each trading style are many and varied, and increasingly difficult to quantify. There are many tax breaks that only apply to companies, and limited liability is often a very sound reason to use a company.

Next year, when Corporation Tax is due to rise to 25%, maybe the balance will shift and we will advise differently; we'ill be taking a more detailed look later. One thing is abundantly clear, taxes as with many other costs, are not going to be reduced for some time. All business owners need to take advantage of as many tax breaks as they possibly can.

More guides and update below.

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 (Freeview) 

Employer Bulletin: April 2022 
HMRC have published their Employer Bulletin for April 2022. We have summarised the key content for you, with links to our detailed guidance on the topics covered.

Consultation response: Corporate re-domiciliation 
The government has published its response to its consultation ‘Corporate re-domiciliation’ which explores whether there is a need to make it easier for foreign-incorporated companies seeking to relocate to the UK to change their place of incorporation to the UK.

Concerns over Welsh Tax Act proposals 
Senedd Committees have expressed concerns over government modifications to the Welsh Tax Acts etc. (Power to Modify) Bill. Primary concerns include constitutional issues and retrospective aspects of the proposals.

Fuel scale charges (VAT)
UPDATE: HMRC have published the VAT fuel scale charges which apply from 1 May 2022 to 30 April 2023 to account for private consumption of fuel on a business vehicle.

Editor's Pick (subscribers)

Sole trader v. limited company: Tax differences & savings (2022/23)
Is it better from both a tax and legal point of view to run your business as a sole trader or as a company? Are there tax advantages in running a business as a company? What legal protections apply?

Guides & Updates (subscribers)

Self-employed

Basis Period reform
UPDATE: What is basis year reform? Who is affected? What is the new basis year for tax? What are the transitional rules?

Companies

Insolvency FAQs for boards
UPDATE: What issues do the board need to consider when a company is about to go into insolvent liquidation. This guide considers some common FAQs that directors may have about insolvency situations.

Theatre Tax Relief: Tax relief for theatrical productions
UPDATE: What is Theatre Tax Relief (TTR)? Who can claim it? What are the conditions? What is a commercial purpose? 

Groups
UPDATE: What qualifies as a group for tax? How do you form a group? Which definition of a group applies for different types of tax? What are the benefits of being in a group?

Overseas & Residence 

Non-Domiciles Tax Toolkit
This toolkit provides an outline of the tax compliance issues for non-UK domiciled (non-dom) individuals.

Non-Resident Tax Toolkit
This toolkit covers the key UK tax issues for non-UK resident individuals holding UK assets and property and working in the UK.

Employers 

Payrolling of benefits
UPDATE: The value of certain taxable benefits in kind can be included in taxable pay when calculating the PAYE deducted from payments of wages and salaries to employees.

Private Client & Estate Planning 

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.

Top Slicing Relief: How you slice it
What is Top Slicing Relief? When does it apply?

Tax Cases (freeview)

Finance Act 2020 changes not retrospective for Top Slicing Relief  
In Sally Judges (as representative for the late R Young) v HMRC [2022] TC08408, the First Tier Tribunal (FTT) found that changes to top slicing relief introduced by Finance Act 2020 were not retrospective in their effect.

VAT Cases & Guides 

Partial exemption: standard method replaced  
In Hippodrome Casino Ltd v HMRC [2022] TC8441, the First Tier Tribunal (FTT) allowed the standard method of attributing VAT between taxable and exempt supplies to be replaced by an alternative method.  Attribution of Input VAT relating to premises costs was allowed based on utilised floorspace.

Partial exemption & input VAT
How do you calculate the amount of input tax you can recover under the VAT partial exemption rules? What are the de minimis rules?

Margin scheme
UPDATE: The VAT margin scheme allows businesses to calculate their output VAT liability on the profit margin they make on the goods they sell.

Input VAT: What constitutes a valid claim (& VAT invoice)
UPDATE: What is Input VAT? Who can claim it? What is needed for a valid claim? What needs to be included on a VAT invoice and can you make a claim without one? 

Tax Tools 

Tax Tools
Be a winner with our game-changing tax diagnostics tools for Business Asset Disposal Relief, SDLT & annexes/subsidiary properties, Company reorganisations, R & D Zone and TAAR on winding up. Sign up now!

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: Business Asset Disposal Relief
• CPD: Appeals: How to Appeal a Tax Penalty
• CPD: VAT: Land and Property

More at CPD Index

Missed last time's Web-update?

Nichola's SME Tax W-update 14 April 2022

• Settlement opportunity for Remuneration Trust schemes
• Companies House: What's New 2022?
• Tax avoidance scheme promoters named
• A new business? Start here
• Employer error extends auto-enrolment time limits
• Tax treaty saves Oppenheimer £10m of tax
• IR35: Sky football pundit was an employee
• Day Calc (freeview)
• Flapjacks not cakes for VAT 
• Land & Property VAT (Subscriber guide)
• Self Employment Calc
• Salary v Dividend Calc
• Salary 2022/23 (avoiding NICs)
• Goodwill and the intangibles regime
• SDLT: Residential property higher rates
• Tax treaties: Where do you live?
• Non-domicile status, deemed domicile & tax
• Divorce & Separation: Toolkit
• Disguised remuneration loan charge ...More 

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