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12 March 2020

It has been confirmed by the Chancellor that the Research and Development Expenditure Credit (RDEC) is to be increased from 12% to 13% on 1 April 2020. The RDEC allows companies to claim an enhanced Corporation Tax deduction or payable credit on qualifying R&D costs. The RDEC replaced the large company scheme that was withdrawn in April 2016. This will help large companies to claim more...

12 March 2020

The new Chancellor, Rishi Sunak, has confirmed a Conservative manifesto promise to increase the National Insurance contributions (NIC) thresholds to £9,500. Plans to meet the manifesto pledge were first confirmed by Mr Sunak's predecessor Sajid Javid earlier this year.

The increase by more than 10% over the current year’s figure of £8,632 will apply to both the employed and self-...

12 March 2020

In the face of Brexit uncertainties and the recent Coronavirus outbreak the new Chancellor, Rishi Sunak, was faced with falling economic indicators, the need to boost NHS services and was consequently limited in his options to spend on plans to improve business confidence and fund infrastructure projects.

Interestingly, there were a number of measures that will directly benefit those...

12 March 2020

Following an announcement at Autumn Statement 2016, and subsequent consultations, the government moved forward with plans to charge Corporation Tax to non-UK resident companies with property income. Currently, these companies are chargeable to Income Tax and not UK Corporation Tax.

This measure will come into effect from 6 April 2020 when any non-UK resident companies that carries on a...

12 March 2020

The government has confirmed that the period for which the 100% first year allowances (FYAs) are available is to be extended from April 2021 to April 2025. In tandem with this announcement, there is also a significant reduction in the CO2 emission thresholds which are used to determine the rate of capital allowances available for business cars.

This means that the 100% writing down...

05 March 2020

Public Health England has published new guidance specifically for employers and businesses on the novel coronavirus, COVID-19. The government says that the new guidance will assist employers and businesses in providing advice to staff on:

  • the novel coronavirus, COVID-19
  • how to help prevent spread of all respiratory infections, including COVID-19
  • what to do if...
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

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 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

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

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

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

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...

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;...

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