Tax Articles Articles

CIS changes

HMRC announced they were making some minor changes to the CIS scheme from 6 April 2024, in that VAT failures are now counted when looking at whether a firm qualifies for gross payment status. In line with other taxes, minor failures will not count towards gross payment disqualification. “Minor failures” are: 3 late submissions of…

Navigating Tax Changes: High-Income Child Benefit Charge and Other Updates 

THE HIGH-INCOME CHILD BENEFIT CHARGE In an effort to reduce unfairness, the thresholds for the high-income child benefit charge (HICBC) will be increased from 2024/25. You may have to pay the HICBC if you are considered to have ‘high income’ and child benefit is being paid in relation to a child that lives with you,…

CIOT Responds to HMRC Regarding the Current Problems with R&D Tax Relief

In the summer of 2023, HMRC and the Chartered Institute of Taxation (CIOT) exchanged lengthy correspondence about the approach being taken by HMRC relating to R&D tax relief claim compliance checks. The CIOT expressed concern about a number of tactics being employed; HMRC’s response was to largely defend the measures being undertaken. Several months have…

The Pension Savings Tax Charge… could result in a Tax Saving?

Pension Savings Tax Charge Each tax year, a UK resident individual who is a member of a registered pension scheme is entitled to an annual allowance in respect of pension contributions. For the 2023/24 tax year, the standard annual allowance is £60,000. The annual allowance effectively sets a limit on total contributions that can attract…

Tax relief on travel costs ‘’making a claim in your personal tax return and a reminder these rules also affect employees working through intermediaries’’

As we approach the deadline for submitting tax returns again, many accountants will be provided with receipts for train journeys and mileage logs from clients wishing to make a claim and obtain a tax refund from their tax paid in their employment role. The general rules The general rule for employees claiming tax relief for…

Furnished Holiday Let capital allowance trap!

Furnished Holiday Lets (FHLs) are a type of property income that attracts special tax treatment, giving similar tax breaks to a trading activity rather than an investment activity. A broad overview of the rules can be found in HMRC’s Helpsheet 253. The ability to claim capital allowances within an FHL is one of the key…

Transferring Ownership of Property

We are frequently asked to advise on the tax implications of transferring property between individuals and of incorporating a property business. Whilst the specific details of each transaction will always need to be considered, the following provides an outline of the basic tax treatment. Transfers Between Individuals Capital Gains Tax A transfer of ownership is…

What is the tax treatment of an overage clause and its subsequent gift?

Question: We have two clients who are sisters that jointly own a parcel of land in England that they inherited from their parents in the late 1970s. The sisters are both UK resident and domiciled individuals and are over State Retirement age. Historically, the land was used for agricultural purposes, but in more recent years,…

Article of Transitional Profit 2023-24

Question: I am looking at my client's projected tax position for the year ending April 2024. This is the year in which the change in basis periods takes effect, and I would like to know about the treatment of the profits of the ‘transitional period’ and wonder if you could advise me? Answer: The transitional…

Are you accessing all of your client’s data correctly through HMRC’s online services?

Taxpayers can now grant authority for agents to access their pay and tax records directly via the Agent Services Account. Agent Services Account The Income Record Viewer is accessed via an Agent Services Account. If an account has not already been set up, it will need to be created before authorisation can be obtained. The…

Unprecedented Challenges: Understanding HMRC’s Scrutiny of R&D Tax Credit Claims and the Role of SIC Codes

As Tax Fee Protection Providers, our claims department have seen the volume of R&D tax credit investigations reach previously unprecedented levels. Most of our accountancy clients are perplexed about why these claims have been challenged by HMRC whereas in previous years claims from even the most unlikely candidate companies for R&D have been processed without…

Q: I want to buy a motorhome or campervan; what are the tax implications?

Motor Homes HMRC has always considered these vehicles to be cars for tax purposes because they are mechanically propelled road vehicles, and none of the exceptions in EIM23100 apply to prevent them from being cars. This means that, unless manufacturers start making low-emission motor homes, anyone provided with a motor home as a company car…

The pitfalls of Share Dealing – Are You Trading for loss relief?

The recent case of N Henderson v HMRC [2023] TC8755 shows that it is not always easy to distinguish whether dealing in shares is an investment activity or enough to warrant being treated as a trade for tax purposes. This distinction is crucial when using sideways loss relief against other income. Background and Transaction History…

Good news for non-residents hit with an additional 2% stamp duty!

Since the 1 April 2021, different rates of Stamp Duty Land Tax have applied to purchasers of residential property in England and Northern Ireland who are not resident in the UK. The rates are 2 percentage points higher than those that apply to purchases made by UK residents. This surcharge applies to purchases of both…

Change of enforcement date for new claim notification and additional information requirements: August 8, 2023

New claim notification and additional information requirements will not be enforced until August 8, 2023. Originally due to come into effect on August 1, 2023, ‘The relief for research and development (content of claim notifications, additional information requirements and miscellaneous amendments) regulations 2023’ will now be laid a week later than expected due to delays…

Deadline for voluntary National Insurance contributions extended to April 2025

Taxpayers have been granted an extension until 5 April 2025, to address gaps in their National Insurance records from April 2006, potentially increasing their State Pension entitlement. This recent announcement by the government (made on 12 June) offers an additional period of nearly 2 years for individuals to make informed decisions regarding voluntary contributions, ensuring…

Tax Returns

Submission dates and whether you need to complete one. An overview Notices to complete Self-Assessment tax returns are issued after April 5th each year. The notice requires the person named to complete a tax return declaring details of all their income and claims for allowances/reliefs for the year ended April 5th of that year. The…

Plastic Packaging Tax Reminder

If you manufacture or import 10 or more tonnes of plastic packaging within a 12-month period, you must register for PPT on GOV.UK, even if your packaging contains 30% or more recycled plastic. ou manufacture or import 10 or more tonnes of plastic packaging within a 12-month period, you must register for PPT on GOV.UK, even if your packaging…

My client is in the process of selling woodland whose trees are being sold as ‘pending issuance units’ (PIUs). Will the value attributable to the woodland be exempt from Capital Gains Tax?

First, a little background… The UK Woodland Carbon Code (WCC) is a government backed standard for woodland creation projects across the UK. It provides a framework for the sequestration of carbon dioxide from the atmosphere to help the UK achieve its targets for tackling climate change. At its core, the code provides an opportunity for…

HMRC Cracking Down on R&D Claims

Companies that conduct Research and Development (R&D) need to be aware of the upcoming changes in the R&D tax relief starting 1 August , 2023. The UK government has become increasingly concerned about the number of companies that have been abusing the R&D scheme. As a result, HM Revenue and Customs (HMRC) has issued new…

Challenges Posed by HMRC Enquiry

There has been a considerable increase in HMRC’s scrutiny of claims, with bona fide claims being rejected on the basis of a disputed interpretation of the relevant provisions. This in turn has caused considerable commercial anxiety for businesses that may have based their planning on what was a previously settled view of the law. Our…