Nichola's SME Tax W-update 16 March 2023

Hello,

This week we have our take on yesterday's Budget, news of new consultations, updates on our toolkits and some more topical case updates.

The Chancellor did not have much room for any giveaways in his 2023 Budget and we learned that we are narrowly avoiding a recession, which is good news. His proposals to create tax-free childcare are very welcome for parents and there is an increase to the rates of Qualifying Care Relief (QCR), which may be useful if you are acting as a carer.

Some companies stand to do reasonably well following his proposal 'to expense' capital allowances, but is that really as good as it seems? This measure is only set to apply to expenditure on 'qualifying' plant and machinery, and we already have an Annual Investment Allowance (AIA).

The decision to remove the Pensions Lifetime contributions limit on pensions does not mean that anyone drawing down on their 25% tax free lump sum will be any better off as a consequence, although if you are someone who had previously applied for Pensions Protection, you will still be able to access a larger tax-free pension pot. As always the devil is in the detail.

We also have a couple of new consultations which are worth a mention. Do your clients really understand the restrictions that apply when they use the cash basis of assessment? The government is proposing to extend cash basis so that it's the default basis for sole traders.

We also have a VAT consultation which looks at extending energy saving materials relief by adding electrical battery storage to the list of qualifying technologies. It also asks you if you can think of any other technologies to be added.

That's all for now, 

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)  

Budget 2023: At a glance
Key announcements made by the Chancellor in his speech yesterday and our pick of what's hot or not for SME owners and their advisers from the accompanying documents and policy papers.

Budget 2023: Live Speech Highlights
Key moments from the Chancellor's live speech

Expanding the cash basis: consultation 
To simplify or not? HMRC is considering increasing the turnover limit, making the cash basis the default basis for the self employed and options for extending tax relief on losses and finance costs.

Extending VAT energy saving materials relief
HMRC have launched a new call for evidence ‘VAT energy saving materials relief, improving energy efficiency and reducing carbon emissions’. This examines adding electrical battery storage to the list of qualifying technologies, and asks whether more technologies should be added. It also reinstating the relief to buildings used for a relevant charitable purpose.

Just how are our taxes raised and spent?
UPDATE: How does the UK raise its taxes? How does the UK spend its tax revenue? Which taxes raise the most revenue?

Editor's Pick 

Tax Update 2023 and Rolling Planner 2023-24
UPDATE: check out the new tax rates and allowances that come in from 1 April onwards, plus updated for Budget 2023 key announcements

Tax Update 2022 and Rolling Planner 2022-23
UPDATE: we tracking tax announcements affecting the current tax year

Tax Tools 

Salary or salary plus dividend combinations calc
Do I pay a small salary with a dividend? What is the optimal salary to pay in 2022-23 or 2023-24? What is the advantage of claiming the Employers' NICs allowance? Compare payment of a salary to payment of a dividend, compare payment of dividend to payment of a dividend with also a small salary.

Adjusted Net Income Calculator
Calculator of the week: This week's calculator helps you work out your 'Adjusted Net Income' to check if you are a higher rate taxpayer for the purposes of various different allowances and charges including the High-Income Child Benefit charge and the Personal savings allowance.

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.  

Self-Employed 

Business Asset Disposal Relief Sole Trader
This tax tool works out if your disposal meets the qualifying criteria to claim Business Asset Disposal Relief. It applies across multiple different permutations of the rules and provides different outcomes to around 50 permutations.

Land & Property

Stamp Duty Land tax (SDLT) & annexes
Does your annex qualify for SDLT relief? How to calculate SDLT if you are buying two or more properties in a single transaction: use this tool to see if you meet the qualifying conditions and you may be able to claim both Multiple Dwellings Relief and relief from the Higher Rate Charge

Directors & Companies

VtaxP: Re-organisation toolkits
These toolkits aim to provide you with step by step support to take you through some complex tax planning situations. Each tool is available to purchase as a single item, or you can buy the set. They are free with a subscription to www.rossmartin.co.uk

Private Client & Estate Planning

NHS Pensions: Scheme pays elections
What is an NHS scheme pays election? What is the deadline? What if complete information is not available by the election deadline? Can elections be amended? 

CPD for Lunch

Byte-sized chunks of lunchtime CPD for subscribers

• NEW: CPD: Taxation of couples in 2022-23
• CPD: Associated Companies
• CPD: Directors Tax Update 2022-23
• CPD: Land and Property Update 2022-23

More at CPD Index

Tax Cases (Freeview)  

CoA: confidential information can be disclosed to another taxpayer   
In Mark Mitchell and Paul Bell v HMRC [2023] EWCA Civ 261, the Court of Appeal (CoA) ruled that HMRC had discretion to disclose confidential documents obtained through a Code of Practice 9 enquiry to another taxpayer.  The CoA First Tier Tribunal and Upper Tribunal did not have jurisdiction over this disclosure.

CoA: Sub-sale avoidance scheme ineffective  
In Oisin Fanning v HMRC [2023] EWCA Civ 263 the Court of Appeal found that the granting of an option was not sufficient to claim sub-sale relief to reduce the Stamp Duty Land Tax liability on the purchase of a £5m property to nil.

Tax Queries?

UK Agent for registration of Overseas Entities
Do you require assistance in the registration and verification of an overseas entity that owns UK land or property?

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.  

Missed last time's Web-update?

Nichola's SME Tax W-update 9 March 2022

• Pension: Check National Insurance records by 31 July 2023
• Spring Finance Bill & Budget
• COVID support fraudsters escape prosecution
• Super-deduction one-to-many letter 
• Official rate of interest
• A landlord? Start here...
• SORN car available for Benefits code  
• Reversionary interest was not excluded property 
• UK-domicile chosen on fleeing the Nazis
• LLP and corporate members were related for IP amortisation
• College training restaurant's supplies VAT exempt 
• Revenue and Customs Brief 2 (2023): VAT and value shifting consultation update 
• Revenue and Customs Brief 3 (2023): Changes to VAT treatment of local authority leisure services
• Assessments: Best judgement UPDATED
• Agents and principals UPDATED
• Salary 2023/24 (avoiding NICs) NEW
• Basis Period reform UPDATED
• Pubs & Bars: Tax Overview NEW
• Employment-Related Securities: Reporting  UPDATED
• Directors' responsibilities and duties UPDATED ...More

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