Nichola's SME Tax W-update 27 October 2022

Hello, 

The new Chancellor of the Exchequer, Jeremy Hunt, has decided to put back the third 'fiscal event' of this autumn to 17th November, transforming it into the annual occasion that we had all been expecting, an Autumn Statement accompanied by a report from the Office of Budget Responsibility (OBR).

After spending a lot of time updating our website for the various changes over tax proposals, we are all grateful to find that we are effectively back in a time of 'pre-Budget purdah', where there are unlikely to be any more tax announcements for at least three weeks. 

Property taxation may well be foremost on the new Chancellor's mind. We note from data released by HMRC and the Department of Levelling Up, Housing and Communities that private individuals have been leaving the property rental market. We are unsure if this means that many are incorporating their property portfolios or just selling up. New data released in a couple of surveys reveal that landlords are sensitive to legislative changes, and not forgetting that increasingly high interest rates have driven up the cost of morgages and that higher rate tax relief on the cost of interest is no longer available. 

This week we also have new CPD on Incorporating your business, like all our 'CPD for lunch' webinars, this material is free for subscribers to our webservice. 

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) 

Autumn Statement scheduled for 17 November 2022
The Chancellor Jeremy Hunt has announced that the Medium term fiscal plan scheduled for 31 October 2022 has been delayed until 17 November 2022 and upgraded to a full Autumn Statement.

Paper tax returns due by 31 October
31 October is the deadline for filing your tax return if you wish to make a paper filing for the 2021-22 tax year.  Filing by paper after this deadline can lead to a penalty.

Statistics reveal a reduction in private landlords
Are landlords incorporating or selling up? HMRC has issued the official property income statistics for 2020-21 which indicate a decline in the number of individual private landlords and highlight the high costs of financing buy to let properties. 

COVID-19 Support: HMRC evaluation and PAC inquiry  
HMRC have released interim evaluations of the COVID-19 CJRS and SEISS schemes.  These have been followed by the Public Accounts Committee (PAC) who have launched an inquiry entitled COVID-19 Employment Support Schemes which will also review their effectiveness.

Editor's Pick  

New Landlord? Start here
Our 'At a glance' guide is essential reading for landlords: our guides take you step-by-step through planning your business for tax purposes and complying with your different tax obligations during the life of your rental business.

Making Tax Digital: Survival guide (for the self-employed & landlords)
Our  'At a glance' guide for the many self-employed taxpayers, company owners and property landlords on HM Revenue and Custom's radical plans to transform the tax online filing system. 

Guides & Updates 

Statutory Review (by HMRC)
UPDATE: Updated to reflect HMRC's new guidance.

Directors & Companies

Family Investment Companies
What is a Family Investment Company? Why use a Family Investment Company? What is the tax treatment of a Family Investment Company?

Self-employed

Partnerships: How to prepare partnership and partners tax returns
How to prepare partnership returns. How are partnership profits calculated? How are corporate members of partnerships taxed? 

Partnership agreements: What should be considered?
Partnership agreements can be invaluable to clarify everyday matters and settle disputes within a partnership. What sort of things should be discussed for inclusion in a partnership agreement? Why are they important?

Land & property  

Furnished Holiday Letting
What is Furnished Holiday Letting? How do you qualify for Furnished Holiday Letting? What are the rules for Furnished Holiday Letting?

Joint property: legal v beneficial ownership
What is the difference between legal and beneficial ownership? What are the tax consequences? Are the rules different for married couples?

Employers 

Termination, redundancy and leaving payments
UPDATE: How are redundancy and termination payments taxed? What amounts can be paid tax-free? What amounts are taxable as earnings?

PAYE Settlement Agreements
UPDATE: What are PAYE Settlement Agreements? How do they work? What can be included? 

Private Client & Estate Planning 

Foreign and residency pages: FAQs
UPDATE: How do you complete the foreign and residency pages of the Self Assessment return?

Business Asset Disposal Relief (Entrepreneurs' Relief): Disposal of shares or securities in a company
When can you claim Business Asset Disposal Relief (BADR) on a share sale? What is the rate of Business Asset Disposal Relief (Entrepreneurs' Relief)? How do you claim BADR? What case law is there on BADR?

Capital taxes round-up: 2022
UPDATE: A round-up of developments in capital taxes for 2022 including some topical Capital Gains Tax (CGT) and Inheritance Tax (IHT) cases.

CGT: Death
UPDATE: What are the Capital Gains Tax implications on death? What is the 'tax-free uplift' on death?

Tax Cases (Freeview) 

SDLT: Right of way did not change nature of residential property   
In James and Charlotte Averdieck v HMRC [2022] TC 8623, the First Tier Tribunal (FTT)  ruled that the maintenance obligations a public right of way put on the landowners were insufficient to render the purchase mixed use and subject to lower non-residential rates of SDLT. 

EBT contributions not recoverable from director during liquidation 
In Asertis Limited v Mr Dale Heathcote and Servico Contract Upholstery Limited [2022] EWHC 2498 the High Court found that a company director was not liable to repay contributions to an EBT after his company went into liquidation. They were properly authorised and justifiable as remuneration.

VAT Cases & Guides 

Children's face masks VAT-free
Children's facemasks are zero-rated for VAT: they are 'clothing', according to HMRC's Revenue & Customs Brief 11 (2022): ‘VAT and children’s face masks’. This sets out HMRC’s revised position in relation to children’s face masks and their VAT treatment.

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!

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: Incorporating in 2022-23
• 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 20 October 2022

• Government reinstates increase to Corporation Tax rates
• House of Lords Call for Evidence into R&D relief
• Fiscal Statement October 2022: At a glance
• Employer Bulletin: October 2022
• Agent Update: October 2022 
• Sch 36 request not reasonably required
• Input VAT claims allowed for Steam vouchers bought in Harrods 
• Employee Ownership Trusts: An exit route for owner-managers
• Associated companies & tests for control
• Adviser's Guide: Property Business, profits and losses
• EMI: Enterprise Management Incentive Scheme
• Top Slicing Relief: How you slice it
• Correcting VAT errors
• CPD: How to avoid the High-Income Child Benefit Charge (HICBC)...More 

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