In Julian Blackwell v HMRC [2017] EWCA the Court of Appeal upheld the decision of the the Upper Tier Tribunal (UTT) in concluding that a payment of £17.5 million claimed as a deduction from consideration received on a disposal of shares was not enhancement expenditure.
SME Tax News
In Deadoc Construction Ltd & Anor v HMRC [2015] TC 04610 the First Tier Tribunal allowed in part an appeal against HMRC’s refusal to allow input tax due to the relevant invoices not being compliant with regulation 14 of the Value Added Tax Regulations 1995 (SI 1995/2518).
The decision in David Alexander Keyl v HMRC [2015] FTC/97/2014, in which The Upper Tier Tribunal (UTT) upheld the decision of the First Tier Tribunal to deny the appellant's Annual Investment Allowance claim for the final period of trade. It highlights the importance of planning ahead when ceasing or incorporating your business.
In JR Scott v HMRC [2015] TC04597 the First Tier Tribunal (FTT) allowed a special relief claim on the basis that HMRC had not addressed the appellant’s argument that determinations raised were unreasonably excessive.
HMRC says that they are concerned by the number of cases in which a company has registered a share scheme for the tax year 2014/15 but has not submitted an annual return online.
The Chancellor will make his Autumn Statement on Wednesday 25 November 2015, and will also publish an Office for Budget Responsibility forecast and Spending Review.
Both the Institute of Chartered Accountants In England and Wales (ICAEW) and the Association of Taxation Technicians (ATT) have asked HMRC to consider postponing next April's changes to the employee benefits and expenses reporting systems.
In R (on the application of James Derry) v HMRC [2017] EWCA Civ 435, the Court of Appeal agreed with HMRC that a carry-back share loss claim did not reduce a previous tax year’s liability. It reduces the current year tax. They also found that HMRC had opened the wrong type of enquiry into the loss relief claim.
From 6 April 2015
Gift Aid intermediaries
A charity requires a gift aid declaration (GAD) from a donor in order to be able to claim gift aid. Where donations are made via an intermediary, such as a website, or via text it is difficult because the intermediary has to collect the declaration from the donor and pass it on to the charity.
Finance Act 2015 amends ITA 2007 to allow declarations to be made by the intermediaries on behalf of the individual donors as follows:
- In Chapter 2 of Part 8 of ITA 2007 (gift aid), section 416 (meaning of `qualifying donation`) is extended by the insertion of `or an intermediary representing the individual` to allow GADs made by intermediaries on behalf of individuals to have effect as if they were made by individuals.
- Section 428 (meaning of ‘Gift Aid Declaration’) is amended to cover such declarations. The power contained in Section 428 to made regulations regarding GADs is amended so that specific regulations can be made regarding declarations made by intermediaries on behalf of individuals.
Gift Aid App
A new App has been developed to help both charities and donors. It allows charities to automate their donation process from new donors and donors to automate the process of making a donation and Gift Aid Declaration (GAD) directly to the charity, via their mobile phone and recording the amount of their donation (for later entry on to a self assessment tax return). The app provides the Charity with the audit trail to match the donation to the GAD. Please Contact VTP for further details.
Community Amatuer Sports Clubs (CASCs)
From 1 April 2015 the regulations have been updated in order to specify a maximum amount for costs associated with membership of a club, use of its facilities and full participation in its activities. They will also set a maximum upper limit that a club can charge in membership fees.
- CASCs are allowed to pay players so long as the total payments made to all players in a year, including any benefits, are no more than £10,000.
- Clubs are also be allowed to make travel and subsistence payments to players, subject to certain restrictions.
- The regulations provide detailed rules on a new eligibility condition relating to the amount of social income a club can receive.
- The maximum amount of receipts that a club can receive in order to qualify for the exemption from corporation tax on trading income is increased from £30,000 to £50,000.
- The maximum amount of receipts that a club can receive in order to qualify for the exemption from corporation tax on income from property is increased from £20,000 to £30,000.
See HMRC CASCS
From 6 April 2016
Gift Aid Small Donations scheme (GASDs)
The limit for GASDs will increase to £8,000.
Community Amateur Sports Clubs (CASCs) may claim gift aid-style top-up payments of up to £2,000 a year.
Gift Aid Declarations and Partnerships
- From 6 April 2016, when a partnership makes a donation under Gift Aid each individual partner must make their own Gift Aid declaration, specifing the amount of each partner’s share of the whole donation.
- The old rules: up to 5 April 2016, one partner is able to make a Gift Aid declaration on behalf of all the partners in a partnership provided he is given such a power under deed (e.g. in the partnership agreement). The declaration must lists all the individual partners’ names and home addresses.
In Unison, R (On the Application Of) v The Lord Chancellor [2015] EWCA Civ 935, the Court of Appeal rejected an appeal by Unison against the introduction of fees for Employment Tribunals.
- Consultation on the introduction of Tax Tribunal fees
- Direct Recovery of Debts targets Accelerated Payment Notices
- New Dividend Allowance is tax rise ‘by the back door’, says professional body
- The perils of termination payments and share schemes
- How dividends are taxed in 2016/17
- Director assessed to car benefit on five cars