When a company is sold, it is often partly for consideration which is deferred in one way or another. Sometimes this will take the form of a debt, such as loan notes. Effectively, the vendor is lending the purchaser the balance of the consideration. If certain conditions (set out in s.117 TGCA 1992) are met, the loan notes will be "qualifying corporate bonds". There are specific considerations that need to be made in such cases.
Where shares are exchanged for QCBs s.116(10) TCGA 1992 applies automatically such that, any…
Inheritance tax is possibly the least popular of the main taxes. However, in most cases, no IHT is payable on transfers made to a spouse or civil partner – regardless of whether this takes place during the lifetime of the person making the gift, or via the will following death.
However, this exemption is restricted if the person receiving the gift is not UK-domiciled. There is good reason for this. Non-domiciled individuals are not subject to UK IHT on their worldwide estate, instead it only the value of UK-situs…
The annual investment allowance (AIA) has been at a temporary increased amount of £1 million since January 2019. This was supposed to revert to £200,000 after 31 December 2021 but has been extended for various reasons until 31 March 2023. As we are now in the final twelve months of the increase (subject to any further extension), it’s a good time to look at how the transitional rules work for accounting periods that straddle 31 March 2023.
The super deduction is also available until 31 March 2023, however this…
Penalty reprieve ends and interest rate hike
Any taxpayer that was relying on the relaxation of the late payment penalty rules must have either paid their tax bill or agreed a time to pay arrangement before 1 April. Unless there is a reasonable excuse, a 5% penalty will shortly be levied.
Additionally, from 5 April the penalty interest rate on late payments of tax will increase to 3.25%, following the latest rise in the Bank of England base rate. This applies even where a payment arrangement is agreed.
The official rate…