Making Tax Digital (MTD)
Mandatory digital record keeping for VAT for businesses over the VAT threshold (with turnover over £85,000) comes into force from 1 April 2019. This is an important first step in this modernisation of the tax system to which the government remains committed. In the WMS, the Chancellor confirmed the government’s ‘light touch approach to penalties in the first year of implementation’. Where businesses are doing their best to comply, no filing or record keeping penalties will be issued. The focus will be on supporting businesses…
The government has previously stated its ongoing commitment to keeping the tax administration framework under review to ensure that it ‘continues to strike the right balance between robustly challenging tax avoidance, evasion and other forms of deliberate non-compliance, and treating all taxpayers fairly’. Finance Act 2019 subsequently contained provisions introducing statutory reporting requirements by the government on certain anti-avoidance measures (FA 2019, s 92 and 93).
HM Treasury and HMRC have published a joint policy paper setting out the government’s approach and achievements in tackling tax avoidance, evasion and…
Chancellor Philip Hammond has delivered his 2019 Spring Statement to the House of Commons. A supporting Written Ministerial Statement (WMS) provides more detail on some of the announcements in the Spring Statement, and sets out details of other forthcoming government policies.
Mr Hammond opened his Statement by acknowledging that the most urgent task at present is to ‘lift the uncertainty’, but he also added a positive note, stating that the ‘economy itself is remarkably robust’.
The Chancellor indicated that if the UK does leave the EU with a deal,…
The tax and NIC treatment of tips will depend on how they are paid to the recipient.
Cash tips handed to an employee, or say, left on the table at a restaurant and retained by the employee, are not subject to tax and NICs under PAYE, so there is not responsibility for the employer to keep track of them and deduct tax or NICs. The employee is however, obliged to declare the income to HMRC and pay the tax and NICs due.
By contrast, if the employer passes tips to…
HMRC have updated their online guidance on disclosing unpaid tax to include information on authorising an agent to deal with a disclosure made through the Digital Disclosure Service (DDS).
The DDS gives individuals and companies a chance to bring their affairs up to date in a simple, straightforward way. Anyone who owes tax on your income you must tell us about any unpaid tax now. Anyone who owes tax on income or gains must tell HMRC about any unpaid tax. They will then have 90 days to calculate and…
As 31 March approaches, many companies will be getting ready to tie up tax matters for their financial year-end. Now is a time to ensure that everything is in order regarding directors’ expenses and review loan account record-keeping procedures. This is particularly so as HMRC report that they commonly find errors in relation to directors’ loan accounts when making routine reviews of company tax returns.
The statutory rules for computing taxable profits exclude companies from deducting expenditure unless it is incurred ‘wholly and exclusively’ for the purposes…
HMRC have published Spotlight 47, which provides guidance on tax avoidance schemes that try to avoid the income tax charge on distributions when a company is being wound up.
In recent years, HMRC have endeavoured to prevent schemes being used by shareholders to take advantage of more favourable capital gains tax rates when extracting value from their company.
Until 6 April 2016, under arrangements known as ‘phoenixism’, an individual shareholder who intended to carry on the company’s activities could arrange matters enabling them to wind up the company and receive…