Nichola's SME Tax W-update 13 October 2022

Hello, 

Did you notice that the topic of ‘Net Zero’ was not mentioned in either the Chancellor’s Growth Plan 2022 (published at the mini-budget/fiscal event of September) or in the Prime Minister’s conference speech? It seemed odd.

All is not lost and we now learn that the Department for Business Energy and Industrial Strategy (BEIS) is implementing a review and ‘Net Zero: Call for evidence’ was published this week. It asks for all our input in what we are doing or would like to do to reduce carbon emissions and create new net zero projects in the run up to 2050. This is worth a read. It seeks responses from all stakeholders including the public, businesses, local government and communities as well as from academics and innovators. We presume that future tax policy in this area will emerge once there are some firm plans on the table.

As we stumble through another week of turbulent politics and finance, the Chancellor has announced that there will be another fiscal event on 31 October. It seems that he is being pressured to reverse some of the previously reversed changes. If you want to track the announcements, look no further than our Rolling Tax Planner for 2022/23.

We have made a new calculator which might be useful for you and some of your clients, our ‘Adjusted Net Income calculator’ does what it says on the label. We also have a new guide to tax and expenses if you are running an Airbnb.

More news, updates and cases 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)  

Medium-Term Fiscal Plan set for 31 October 2022
The Chancellor, Kwasi Kwarteng, has announced that he will be holding a 'Medium-Term Fiscal Plan' immediately following the publication of the Office for Budget Responsibility's (OBR) economic and fiscal forecast on 31 October 2022. He has brought forward this date; it had been previously announced in November.

Scottish budget date fixed for 15 December 2022 
The Scottish Parliament has announced that its 2022 Budget will be held on Thursday 15 December 2022. This will set the Budget and spending plans for Scotland for 2023-24.

Net Zero: Call for evidence 
The Department for Business Energy and Industrial Strategy (BEIS) has released a consultation ‘Net Zero: Call for evidence’. It is part of an independent review of the government’s approach to delivering its net zero target.

Consultation: More fiscal powers for Northern Ireland 
The Northern Ireland Assembly Department of Finance has published ‘Consultation on devolution of more fiscal powers’. This considers recommendations made by the Independent Fiscal Commission in May 2022. 

NHS Pensions relief feedback 
The Department for Health and Social Care (DHSC) has responded to consultation feedback on 'NHS Pension Scheme: proposed amendments to continue the suspension of restrictions on return to work'. This includes extensions to the scheme from 31 October 2022 and another consultation on 'flexible retirement and working'.

Editor's Pick  

Adjusted Net Income calculator
This calculator helps you estimate your 'Adjusted Net Income' for tax purposes. You need to work this out in order to calculate whether you are higher-rate taxpayer.

How to calculate the High-income child benefit change
Step by step guide with example calculations

Airbnb: What expenses can I claim? (subscriber content) 
NEW: What expenses can Airbnb owners claim for tax purposes? Can you claim Rent-a-room Relief? How does it affect Private Residence Relief? What are the VAT rules? Our checklist for subscribers.

Guides & Updates 

Finance Act 2022: tax update and rolling planner 2022-23
Our rolling planner tracks the key tax announcements that impact the 2022-23 tax year and beyond. This planner is updated on an on-going basis. 

Directors & Companies

Valuation: Companies
When might a tax valuation be required? What are the main principles in valuing unquoted companies?

Directors' loan accounts: Toolkit (subscribers)
HM Revenue & Customs (HMRC) have a director's loan accounts toolkit for advisers. This is our enhanced version with planning points. 

Land & property  

De-enveloping property
How do you transfer a property held by a cmpany to its shareholders? The tax term is ‘de-enveloping’. There is no specific tax relief for de-enveloping: you need to plan the transfer carefully in order to avoid excess tax charges.

Welsh LTT Rates
UPDATE: From 10 October Welsh rates of LTT and bands have changed.

Employers 

Electric Vehicles: Update 2022
With the increased recent focus on achieving Net Zero, the government is planning to ban new petrol and diesel car sales by 2030. We review some of the tax issues that businesses and their employees may consider when acquiring or providing an electric vehicle.

Pool cars
UPDATE: What is a pool car? How is it taxed? When does it become a benefit? What are the rules? Is it still worth having them?

Private Client & Estate Planning 

Business Asset Disposal Relief (Entrepreneurs' Relief): Disposal of trust business assets
UPDATE: When can trustees claim Business Asset Disposal Relief (BADR)? How to claim BADR. Which types of trust is BADR available to? Who can claim BADR for a trust disposal of business assets?

UK Trusts
What is a trust? What types of trust are there? How are UK trusts taxed?

Tax Cases (Freeview) 

GAAR Opinion: Trust arrangements and loan novation not reasonable  
The GAAR Advisory Panel have released an opinion which has concluded that arrangements that purported to give an individual access to £950,000 without tax consequence were not a reasonable course of action.

GAAR Opinion: SDLT scheme not reasonable      
The GAAR Advisory Panel have released an opinion which has concluded that a property purchase which was undertaken through trusts and involving a peppercorn lease was not a reasonable course of action.

Supreme Court confirms creditor duty
In BTI 2014 LLC (Appellant) v Sequana SA & Ors (Respondents) [2022] UKSC 25, the Supreme Court (SC) confirmed that a company's directors hold no extra duty to a company's creditors until insolvency becomes inevitable. It meant that a large dividend paid whilst the company was solvent was lawful, and was not within reach of the creditors following a later insolvency. 

VAT Cases & Guides 

Land & Property: DIY Housebuilders scheme
UPDATE: It is possible to recover VAT on constructing a new residential dwelling, or dwellings, even where there is no planned sale of the property. This recovery can arise under the special refund scheme for DIY housebuilders.

Flat rate scheme
What is the VAT Flat Rate Scheme (FRS)? Who can apply? How do you apply? What are the rules? What are the rules for capital expenditure and pre-registration VAT? 

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!

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. 

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: CPD: Making Tax Digital
• CPD: Where are we with Crypto?
• CPD: How to avoid the High-Income Child Benefit Charge (HICBC)
• More at CPD Index

Missed last time's Web-update?

Nichola's SME Tax W-update 6 October 2022

• Chancellor reverses cut to 45% tax rate
• 'Small' definition extended to 40,000 more businesses
• Consultation: Reforming non-domestic rates in Wales 
• Economic Crime Bill & Companies House: Update 2022
• Setting up as a tax agent 
• FTT: SDLT discovery valid 
• Employee not faking it, Statutory Sick Pay due
• Super-deduction & First Year Allowances  
• Company Tax: What’s new? 2022 
• Extracting profits (self-employed)
• Buy-to-let ownership: personal v. company? (Subscribers)
• Employment-Related Securities & Share Schemes
• Client Briefing: Making gifts & IHT
• International goods
• NEW: CPD: Making Tax Digital ...More 

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