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05 March 2020

The government has now published its response to the review into the implementation of changes to the off-payroll working rules (IR35) for the private sector. Following the conclusion of this review, the government has confirmed that the changes will still take effect as planned from 6 April 2020, but there will be a package of measures designed to support the roll-out of the changes. Under...

04 March 2020

The VAT treatment of land and property is one of the most complex areas of the VAT legislation. Under certain situations, supplies of building materials can be zero-rated or reduced-rated at 5% for VAT.

For the supplies of building materials to be zero-rated or reduced-rated, all of the following conditions must be met:

  • the goods must be 'building materials'
  • they...
04 March 2020

Savings income and dividends are taxed at the recipients' highest tax rate.

The relevant legislation in ITA07/S16 sets out the following rules.

  • If a person has savings income but no dividend income, the savings income is treated as the highest part of their total income.
  • If a person has dividend income but no savings income, the dividend income is treated as the...
04 March 2020

Special rules apply to transfers of income streams. The rules make it clear that the sale of an income stream - designed to turn economic income into a return that is treated by tax law as capital - is unlikely to work. For example, shareholders could sell the right to receive a large company dividend in exchange for an amount almost equal to the dividend, without selling the shares....

04 March 2020

The P9X form is used to notify employers of tax codes to use for employees. The form confirms expectations that the basic personal allowance for the tax year starting 6 April 2020 will remain at £12,500. The emergency tax code will remain at 1250L. The threshold (starting point) for PAYE will be £240 per week (£1,042 per month).

The basic rate limit is also expected to remain at £37,500...

04 March 2020

There are special VAT rules that allow businesses to standard rate the supply of most non-residential and commercial land and buildings (known as the option to tax). This means that subsequent supplies by the person making the option to tax will be subject to VAT at the standard rate.

The ability to convert the treatment of VAT exempt land and buildings to taxable can have many benefits...

04 March 2020

We have included updates in our newsfeed earlier this year that sales of residential property subject to Capital Gains Tax (CGT) – from 6 April 2020 - will need to be reported and paid to HMRC within 30 days of completing the sale.

Here’s the type of property sales that HMRC say will be affected:

  • a property that you have not used as your main home;
  • a holiday home;...
04 March 2020

The First-Tier Tribunal (FTT) has recently published its decision in a long running case that focused on tax planning arrangements. This important decision represents a significant win for HMRC against a tax avoidance promoter in a case that has been before the FTT since June 2018. The firm in question launched and promoted an arrangement known as the Alchemy scheme. The FTT was clear that...

04 March 2020

The Help to Save scheme can assist those on low incomes to boost their savings. The scheme was launched in September 2018 and new figures just published by HMRC have revealed that over 163,000 people have signed up depositing more than £53 million.

The scheme is open to working people who receive tax credits or universal credit and with a minimum earned income equivalent to 16 hours per...

27 February 2020

Acas has published new guidance for employers and employees on the coronavirus. The guidance covers:

  • what to do if employees do not want to go to work
  • sick pay
  • what to do if employers need to close the workplace
  • other steps for employers to take. 
     
26 February 2020

Goodwill is a subject we hear about often but interestingly is rarely mentioned in legislation. In fact, the term 'goodwill' is not defined for the purposes of the Capital Gains legislation in TCGA 1992.

Most definitions of goodwill are derived from case law. At its simplest you could describe goodwill as the 'extra' value of a business over and above its tangible assets.

In the...

26 February 2020

The new £20 note entered into circulation on 20 February 2020 and features the image of the artist JMW Turner. It will take a few weeks for the notes to become commonplace across the country. The new £20 note includes a number of new security features including two windows and a two-colour foil, making it very difficult to counterfeit.

The new £20 note joins the current £5 and £10 notes...

26 February 2020

In most cases, property rental income must be brought into account in the year in which the income was earned, even if the invoice has not yet been paid. However, a deduction is allowed in respect of bad & doubtful debts.

These are debts which are either clearly irrecoverable (a bad debt) or a doubtful debt to the extent it is estimated to be irrecoverable. The deduction allowable...

26 February 2020

Advisory fuel rates are intended to reflect actual average fuel costs and are updated quarterly. The rates can be used by employers who reimburse employees for business travel in their company cars or where employees are required to repay the cost of fuel used for private travel. HMRC accepts there is no taxable profit and no Class 1A National Insurance on reimbursed travel expenses where...

26 February 2020

The VAT system is policed by HMRC and there are penalties for breaches of the legislation.

There are four conditions that must be satisfied in order for an activity to be within the scope of UK VAT.

These conditions are that the activity:

  1. Is a supply of goods or services
  2. That the supply takes place in the UK
  3. Is made by a taxable person
  4. Is...

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