Nichola's SME Tax W-update 2 June 2022

Hello 

We have a slightly shorter newswire this week due to the bank holidays but still lots of interesting new content and updates to our guides.

HMRC research shows that a majority of eligible taxpayers have concerns about the introduction of Making Tax Digital for Income Tax in 2024, with picking software being the biggest worry. HMRC now has less than two years to engage these taxpayers assuming that the start date is not delayed again.

In honour of the Queen’s Platinum Jubilee, we decided to investigate what the tax rates were in 1952. In this post-war era, taxes were high with Income Tax having an additional surtax or ‘supertax’ which took higher rates up to 90%! There was no Corporation Tax until 1965, but purchase tax, an early version of VAT, ran at 33.3% and estate duty, which eventually became Inheritance Tax, stood at 80%. Inflation was at the same level as it is currently, 9%. Let’s hope tax rates don’t creep up to 1950’s levels too. At least beer was just 6p a pint 70 years ago (about £1.84 today)!

We have an interesting case on VAT and when property development and letting is, and in this case, is not, a Transfer of a Going Concern. The FTT found that a taxpayer who claimed to have a ‘debilitating fear’ of filing an incorrect tax return did not have a reasonable excuse for late filing, whilst HMRC was prevented from requesting information and documents under a Schedule 36 notice because they could not show they were reasonably required.

Lots more exciting content and updates below. Enjoy the long weekend.

Back soon, 

The Team

www.rossmartin.co.uk

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

Quick News (Freeview) 

Six in ten taxpayers not ready for MTD for Income Tax 
HMRC has released 'Research Report 646: Customer readiness for Making Tax Digital for Income Tax Self Assessment (ITSA)'. The research found that whilst four in ten taxpayers surveyed recognised the benefits of the new rules, and thought complying would be easy, six in ten were either not engaged in the process or had concerns.

HMRC warn about SDLT repayment agents  
A press release from HMRC indicates that cold calls are being made to homeowners to encourage them to make spurious Stamp Duty Land Tax (SDLT) refund claims.

Editor's Pick (subscribers) 

Ceasing trading: What are your options?
UPDATE: Final part of our series of planning aids for selling your business. What are your options if you are going to cease trading? What processes must be followed if you want to close down a company? What are the tax, company and insolvency law requirements?

Editor's Pick (freeview)

Calendar of tax deadlines and new tax measures
UPDATE: This is a freeview 'At a glance' rolling calendar of common recurring tax deadlines, new tax measures and other tax significant events.

CGT: How to report
UPDATE: How do you report your capital gains? What return do you use? This freeview guide has been updated for HMRC's CGT Property Disposal Return FAQs.

Guides & Updates (subscribers)

Self-employed

Mixed members: Partnerships with company members
UPDATE: What is a mixed-member partnership?  How are profits of a mixed-member partnership taxed?  What tax adjustments are required?  Are there any relieving provisions? 

Companies

Mutual trading, members clubs and community trades
UPDATE: How are mutual traders, members clubs, associations and community trades treated for tax purposes? 

Employers 

Shares, securities & options: Tax compliance
UPDATE: With the 6 July filing deadline approaching for Employment Related Securities returns, this guide explains what you need to do.

Payrolling of benefits
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.

Land & Property

Property profits & losses: Toolkit (2022-23)
UPDATE: Our Property profits & losses toolkit takes HMRC's version and adds a great deal more information about what you can claim as an individual.

SDLT: Stamp Duty Land Tax, start here
What is SDLT? What are the SDLT rates? What is exempt from SDLT? What reliefs are available? When are returns due? When can you amend a return?

Private Client & Estate Planning 

Deed of variation
UPDATE: What is a deed of variation? When can a deed of variation be used? What are the requirements for a valid deed of variation?

Gift Aid
UPDATE: What is Gift Aid? How does it work? What are the rules? 

Tax Cases (freeview)

Fear of making a mistake not a reasonable excuse 
In Michael Breen v HMRC [2022] TC08482, the First Tier Tribunal (FTT) dismissed an appeal against late filing penalties finding that a debilitating fear of making a mistake was not a reasonable excuse for the late filing of tax returns.

Information requested by HMRC was not reasonably required 
In David Hackmey v HMRC [2022] TC8487 the First Tier Tribunal (FTT) partially allowed an appeal against a Schedule 36 information notice. The information requested was not reasonably required to satisfy HMRC’s remaining suspicions of fraud.

£40m interest payable disallowed due to unallowable purpose 
In JTI Acquisition Company (2011) Limited v HMRC [2022] TC08493, the First Tier Tribunal (FTT) found that the appellant was party to a loan relationship purely to gain a tax advantage. As such the loan had an unallowable purpose and the associated interest payments amounting to over £40 million were disallowed.

VAT Cases & Guides 

Sale of TV studios not a VAT TOGC 
In Haymarket Media Group Limited v HMRC [2022] TC08495, the First Tier Tribunal (FTT) found that the sale of TV studios to a property developer could not qualify as a Transfer of a Going Concern (TOGC) for VAT purposes. The vendor and buyer were not carrying on the same kind of business.

Registering for VAT
UPDATE: When should a business register for and charge VAT? What are the VAT registration thresholds? What penalties might HMRC issue for late notification of registration? When do you need to file a VAT return?

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: Change of Basis Periods Part 1. Planning for the change
• 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 26 May 2022

• Agent update: May 2022 
• Windfall tax measures
• PAC slams IR35 implementation
• Reclaiming tax deducted at source on PPI interest
• Advisory fuel rates from 1 June 2022
• CCAB update their Anti-money laundering and terrorist financing guide
• A sale of the company's trade & assets? Start here...
• Ignoring Follower Notices was reasonable in the circumstances
• Discovery valid due to careless agent  
• ER claim fails again due to lack of trading activities  
• Death and taxes: installation of burial vaults exempt from VAT
• Partnerships: Losses
• R&D Tax Relief: Overview
• Overseas Workday Relief (OWR)
• Non-resident Tax Toolkit
• Non-Resident Landlord Scheme
• Pecuniary Liabilities
• Dividend taxation for non-UK residents
• IHT: Main Residence Nil-Rate Band (RNRB)
• Reverse Charge: Domestic ...More 

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