Where HMRC suspects fraud, it reserves the right to open a criminal prosecution. More routinely, it invites individuals to enter into a disclosure process where immunity from prosecution is possible in exchange for a full and complete disclosure of any...
Beware the pitfalls of an Information Notice, warns Salman Anwar HMRC has numerous powers to conduct enquiries or make assessments but the reality is that HMRC requires evidence to come to their conclusions and that evidences comes in the shape...
The current economic environment has been described in many ways from “challenging” to “brutal” and “utterly depressing”. In the UK Over 9m employees are and have been on furlough since 1st March and over £25bn paid out by the Government...
Tuesday 17 March was a busy and momentous day for the Government. From the growing threat Covid-19 is bringing to the UK and Europe as a whole, to the £330bn financial support announcement for businesses and individuals, it was a...
HMRC has extended its guidance on the tax treatment of crypto-assets held by individual investors to set out its view on where exchange tokens are located for tax purposes. This is primarily of interest to non-UK domiciliaries: considering claiming the...
In this instalment of our blogs on all topics to do with HMRC’s investigations and enquiries, we discuss a recipe which, almost always, leads to disaster for the taxpayer. The main ingredient requires a business in the restaurant/takeaway/hospitality trade but...
As April 2020 approaches, we are seeing momentum gather in respect of organisations gearing up for the introduction of the Off Payroll Working (OPW) rules in the private sector. Our recent article on the topic is available to view here....
Why is this an issue? Have you ever come across the situation where an US company identifies some UK based IT workers that they want to employ? Due to the nature of the work the employees don’t need to relocate...
What is the issue? When UK employers host short term business visitors (STBV) from abroad, they will often create tax, social security and immigration compliance obligations for the business, even though the employees may spend relatively little time in the...
It seems that HMRC is immune to the very behavioural techniques which it has so enthusiastically adopted (such as the use of “nudge letters”) to influence taxpayers’ behaviour in complying with the UK tax legislation. In our blog on nudge...
Mazars on behalf of their client G Haworth have successfully persuaded the Court of Appeal that HMRC unlawfully issued a Follower Notice to their client (Link). We will shortly also be publishing a case note highlighting the legal and technical...
We reported recently that the Government had rejected calls to abandon the DR Loan Charge. There have been further calls for a delay to the loan charge since this but given the comprehensive rejection by the Government to similar suggestions...
The Treasury has finally published its response as required by the Section 95 Finance Act 2019 (FA2019). Section 95 FA 2019 was an amendment to FA 2019 which required the Chancellor to review the Disguised Remuneration Loan Charge (“Loan Charge”)....
At a time when HMRC is actively seeking to remove the Tribunals from approving of third party information notices, there have been a number of cases which show the importance of why the Tribunals should still be involved in the...
The Government has announced the issue of 25 technical notes discussing how various aspects of the economy might operate in the event of a Brexit no-deal scenario. Further technical notes are due in September. The announcement comments: “A scenario in...
Included within the Government’s 25 technical notes for business on preparing for a Brexit no-deal scenario is a note discussing VAT for business if there is no Brexit deal. It reassures business that the UK will continue to have a...
The PAYE Settlement Agreement (PSA) is an effective simplification enabling employers to pay tax and National Insurance Contributions (NIC) directly to HMRC after the end of the tax year on certain employee expenses and benefits without needing to inform employees...
Tax scheme film partnership was not trading or conducted with a view to profit The First-tier Tribunal (FTT) has rejected the appeals by members of the “Vanguard” film partnership against ( Hardy and Moxon v HMRC [2017] UKFTT 0754 (TC))....
The recent decision in HMRC v Root2tax Ltd and Root3tax Ltd [2017] UKFTT 696 (TC) has demonstrated yet again HMRC’s determination to challenge promoters of tax planning arrangements who fail to disclose under DOTAS (Disclosure of Tax Avoidance Schemes) schemes...
If you’re a trustee, especially if you’re the main, or ‘lead’ trustee you need to be sure that your trust is properly registered with HMRC through their Trusts Registration Service (TRS) by 5 January 2018 (a late change from the...
It is said that the real sign that a ship is in trouble is not when the rats jump overboard but when the officers abandon it mid-voyage. If that’s the case, HMRC appears to be sinking because a number of...
In our last blog on optional remuneration arrangements, we discussed the draft legislation which was published on 5 December 2016 and what employers need to know. However, we discussed a number of areas where the meaning and application of the...
Effective from 6 April 2017, i.e. 2017/18 onwards The draft Finance Bill updates some time limits for making good benefits in kind (BiKs). The result is that overall the time limits will become more consistent but the system is not...
The Taxes legislation has long reserved the heaviest penalties for the taxpayer with the most heinous behaviour – so that there is a heavier penalty for the taxpayer who deliberately evades his tax than there would be if he got...
When does it start and who can use it? On the 5th of September 2016, HMRC finally published details of its new disclosure facility; the Worldwide Disclosure facility (WDF), which will run from the 5 September 2016 to 30 September...
In the past few days HMRC have begun to provide some limited details of the next - and long promised - offshore disclosure facility. Referred to as the Worldwide Disclosure Facility or WDF, the disclosure facility will be open to...
Patrick Degorce has invested in film schemes in 2006/07 and 2007/08. His appeal against HMRC’s refusal of relief for 2006/07 was turned down by the Upper Tribunal ([2015]UKUT447) in September 2015 but he has appealed against that decision and the case...
Committee Stage amendments to Finance Bill 2016 correct anomalies in the original clauses to ensure that the IHT residence nil-rate band provisions should work consistently when they come into force on 6 April 2017. The residence nil-rate band (RNRB) rules...
Certainly not coincidentally with the approaching deadline for making employment-related securities (ERS) returns, HMRC have published two new factsheets setting out the amounts of penalties relating to ERS arrangements and returns and their approach to charging those penalties. Material inaccuracy...
Certainly not coincidentally with the approaching deadline for making employment-related securities (ERS) returns, HMRC have published two new factsheets setting out the amounts of penalties relating to ERS arrangements and returns and their approach to charging those penalties. Material inaccuracy...
Tax practitioners with long memories may remember a time – long, long ago – when the promoters of tax avoidance came up with all kinds of wild schemes to circumvent the more annoying features of PAYE – namely the need...
On 9th May 2016 the International Consortium of Investigative Journalists (‘ICIJ’) undertook the next step in their release of the information obtained from the Panamanian law firm, Mossack Fonseca – the so-called Panama Papers – when they allowed public access...
The furore regarding the “Panama Papers” – the 11.5 million documents leaked from the Panamanian law firm of Mossack Fonseca – would seem to suggest that everyone involved in a Panamanian company must be a serious villain on a par...
Following a Court of Appeal ruling in February 2015 which found in favour of HMRC that Eclipse Film Partners No 35 LLP (“Eclipse 35”) did not carry on a trade, the Supreme Court will this week hear the appeal by...
Capital Gains Tax (‘CGT’) charged on gains realised on most assets will fall by 8% to 20% (10% for basic tax payers) from 6 April 2016. Long-term investors will be able to claim investors’ relief on gains realised after three...
The government made a commitment to raise the personal allowance to £12,500 and the higher rate threshold to £50,000 by the end of this parliament. The measures announced today have been billed as a step towards achieving this objective. The...
HMRC have won their appeal against the decision of the First-tier Tribunal that a scheme contrived to turn CGT-taxable non-QCBs into non-taxable QCBs was effective in Hancock v HMRC [2014] UKFTT 695 (TC) Mr. and Mrs. Hancock exchanged shares in their...
This is a final reminder that the Film Scheme Settlement Opportunity and the settlement opportunity for the various tax avoidance schemes involving 'Sideways loss relief' - whether for individuals, partnerships or corporate entities, close at noon on Thursday 11th February...
I was given the job of clearing up after a Christmas Party for tax people, in the course of which I happened to pick up the discarded cracker jokes. Where does Santa submit his tax returns? To the Finland...
The progress of the additional nil-rate band for residences has been rather slow and tortuous: first the basics of Residence nil-rate band (RNRB) were set out in the Summer Budget and Finance (No.2) Act 2015 but at that time nothing...
The Draft Finance Bill 2016 extends the deemed domicile rules announced for other taxes to IHT, so that for once the rules are consistent across all taxes. The content of the DFB shows minimal change from the announcements made...
Here we summarise some of the less prominent draft clauses for the 2016 finance Bill. These may have been announced before or represent little change in practice but they are all important because they all affect someone. Capital Gains Tax: disposals...
Reduction of pensions lifetime allowance As announced in the March Budget the lifetime allowance (LTA) will be reduced from £1.25m to £1m, with effect from 6 April 2016. Protection arrangements will apply. The LTA will be indexed in line with...
The draft Clauses Released so far The draft 2016 Finance Bill clauses cover most of the stamp tax changes announced at the Autumn Statement. Unfortunately, the one area not covered is that which is, perhaps, of the widest interest, the...
OK, we couldn’t resist: like kids staring at the goodies under the tree we just had to start opening our draft Finance Bill goodies early. And just like those kids we now just feel disappointed and queasy in about equal...
HMRC have announced the end of self-assessment for straightforward personal tax and trust cases as part of the ‘Making Tax Easier: Simpler Payment’ move towards fully digital tax accounts and the abolition of self-assessment. Powers will be included in the...
HMRC is consulting until 1 February 2016 on the planned latest addition to the growing ISA family. The Innovative Finance ISA (‘IFISA’?) is designed to encourage peer-to-peer (P2P) lending used by small business borrowers. IFISAs will sit alongside an...
The 9 December draft Finance Bill clauses include the long-awaited details of the dividend nil-rate band (DNRB) including the disappointing confirmation that there will be no tax credits or nil-rate allowance for trusts. The £5,000, applicable in 2016/17, will apply...
The Scottish National Party will present its draft Budget at Holyrood on 16 December. Scotland's draft Budget was deferred from its usual time in September to allow the SNP Government to take account of Chancellor Osborne’s spending plans for the...
Will the Autumn Statement change entrepreneurs’ relief? There is widespread speculation about the possibility of the Chancellor making further changes (restrictions) to entrepreneurs’ relief (ER) when he makes his Autumn Statement next Wednesday, 25 November. His previous reforms have not...
Dr Jones claimed the cost of travelling from his home office to two private hospitals as wholly and exclusively for the purpose of his self-employment but HMRC rejected his claim. The crux of the case was that only expenses incurred...
The Finance Act 2015 introduced a number of significant changes to the application of Entrepreneurs’ Relief with effect from 3 December 2014, and in particular, restrictions to its availability on: associated disposals certain disposals of goodwill to companies,...
The Organisation for Economic Co-operation and Development (‘OECD’) held its final public consultation on Actions 8-10 (transfer pricing/'TP') of the Base Erosion and Profit Shifting (BEPS) project on 6 and 7 July 2015. The first day of meeting focused on...
On 9 July 2015, the OECD released a discussion draft on options for low income countries' effective and efficient use of tax incentives for investment. This Discussion Draft is a result of the G20’s Development Working Group (DWG) who has...
The pre-owned assets tax (POAT) was ten years old on 6 April 2015 but no party was held because nobody would have attended. Introduced as a countermeasure against inheritance tax avoidance schemes, POAT applies to anyone who disposed of an...
The OECD published its revised discussion draft on Action 6 (Prevent the granting of treaty benefits in inappropriate circumstances) of the Action Plan on Base Erosion and Profit Shifting (BEPS) on 22 May 2015. Public comments are invited on the revised discussion...
On 16 April 2015, the OECD has invited public comments on a discussion draft which deals with Action 11 - Improving the analysis of BEPS. Action 11 of the BEPS Action Plan focuses on improving the availability and analysis of data on...
The International Monetary Fund published a Staff Discussion Note on Islamic Finance focusing on opportunities challenges and policy options on 6 April 2015. The Discussion Note highlights that Islamic finance raises a number of tax policy issues as well. Islamic finance...
We said yesterday that Labour was proposing the effective abolition of non-dom status should it form the next government and said that the position of so called ‘hereditary non-doms’ was particularly hard to justify. Whilst the Labour proposals attracted the...
On 9-10 February 2015, the OECD presented the latest developments in the OECD/G20 project to combat BEPS by multinational enterprises during a G20 Finance Ministers and Central Bank Governors’ meeting in Istanbul, Turkey. In their Communiqué, the G20 Ministers and...
Auto-enrolment – The key question for FDs: How to fund it and still contain payroll costs? Many companies are still finding that preparing for auto-enrolment is their biggest objective and challenge. Mazars’ Employee Benefits team have recently undertaken a series...
The OECD public consultation meeting on the follow-up work on BEPS Action 6 was held on 22 January 2015 in Paris. Background Action 6 focuses on Prevent the granting of treaty benefits in inappropriate circumstances and paragraph 5 of the Report...
Summary Article 29a of the General Tax Code on the Advance Tax Rulings and Advance Ruling Committee entered into force on 1 January 2015 in Luxembourg; Luxembourg endorsed the EU Commission’s plan to present a draft directive on mandatory automatic...
I am wondering whether it is only me who is facing hundreds of pages of discussion documents inviting stakeholders’ input or are you also sharing the same experience while you are drinking your strong cup of coffee today! It is...
Is there now a UK immigration policy for business? Half way through the Autumn Statement I was thinking I had never been bombarded by so many statistics in 25 minutes. I was wondering whether there would be time (or energy)...
Some have greeted National Audit Office (NAO) report “The effective management of tax reliefs”, issued on 21 November as if it creates a threat to certain tax reliefs, including entrepreneurs’ relief (ER) from capital gains tax (CGT). That is not...
Public comments are invited on a discussion draft which deals with follow-up work mandated by the Report on Action 6 (“Prevent the granting of treaty benefits in inappropriate circumstances”) of the BEPS Action Plan on 21 November 2014. The OECD...
Prime Minister Abbott and Treasurer Hockey announced today that the G20 Leaders welcomed OECD recommendations that will help restore fairness, integrity and transparency to the international tax system. The United Kingdom's Prime Minister David Cameron announced during the press...
The First Tier Tribunal (FTT) in Nicholas Trigg v HMRC found in favour of an appellant who held ‘future proofed’ bonds that would convert to euros if the UK adopted the euro. Trigg bought the bonds second-hand at a price...
In her opinion issued on 23 October 2014, the Advocate General (AG) stated that the restrictions imposed by CTA 2010 s119 (formerly ICTA sch 18A, as inserted by FA 2006 sch 1) on group relief claims for losses of EEA...
BEPS, FATCA, CRS are the buzzwords which have shaped the tax discussion and meetings recently. On 16 October, Ali Kazimi, Mazars Financial Services Partner, was one of the leading panellists at a HMRC event on the Foreign Account Tax Compliance...
Today, Mazars was very pleased to welcome Dr Tom O’Shea and his LL.M in International Tax Law students from the Centre for Commercial Law Studies, Queen Mary, University of London. Dr Tom O’Shea delivered a very interesting guest lecture entitled...
On 9 October HMRC announced yet another disclosure opportunity. This one is open to businesses that accept payment via credit or debit card. The name HMRC have given is “Credit Card Sales Campaign” (link to HMRC announcement of the opportunity)....
HMRC proposes to withdraw, with effect from 6 April 2016, the concession in EIM 03002 which allows professional practitioners to treat incidental income from offices/employments as part of their trading/professional income for income tax (but not NIC) purposes. (more…)
On 7 October 2014, the OECD published comments received following a request for input on Action 11 (Establish methodologies to collect and analyse data on BEPS and the actions to address it) of the Action Plan on Base Erosion and...
11 days after the warm welcome and endorsement of the 7 Deliverables (2014) by the G20 in Cairns, the OECD published a revised calendar for stakeholders' input. The announcement emphasized that the timeline of the OECD/G20 Base Erosion and Profit...
We welcome the OECD announcement on OECD BEPS project and deliverables. Today is a landmark day for the international tax world and it is expected that the BEPS project marks its first turning point in the history of international co-operation...
On 1 September 2014, the Organization for Economic Co-operation and Development (the OECD) published the condensed version of the OECD Income and Capital Model Convention and Commentary 2014 (2014 Update). This is the ninth edition of the condensed version of...
HMRC has commissioned the Office of Tax Simplification (OTS) to look into the following aspects of civil penalties: (more…)
Taxation magazine's Paula Tallon and Pete Miller have written up an overview of the debate Mazars and ARC recently held at the House of Commons on tax transparency. They have covered the key points of: The need for trust and...
The role of greater transparency in improving public understanding of tax issues and enhancing confidence in the system was the subject of an informative and good-natured debate at the House of Commons on 8 July, hosted by Mazars and the...
How can public understanding and tax transparency shape policy and the role of a trusted advisor? The discussion papers that will be used to explore these issues at an exclusive debate in Westminster next Tuesday, 8th of July are now...
Finance Act 2012 introduced changes to the capital allowances rules for fixtures in buildings. The purpose of these changes is to align the acquisition and disposal values of fixtures for capital allowance purposes when property is bought and sold, so...
In a recent decision (Derek Ross v HMRC [2014] UKFTT 292 (TC)), the First Tier Tribunal has upheld a penalty imposed by HMRC for non payment of the 2011/12 liability by 31/1/2013. What makes the case unusual is that the...
Today George Osborne delivered his fifth budget, and probably most important, of his tenure as Chancellor. In the run up to today, all the talk was about a Budget for business to maintain confidence in the economy with a specific...
The amounts that can be saved through pensions are being restricted and many savers already use their full ISA allowances. So taxpayers are looking for other tax-efficient savings options. Should they take one of the structured retail products available or...
Two changes will be introduced to the CFC rules in the Finance Bill 2014, in order to prevent profit shifting under the finance company exemption provisions. If a UK company currently has in place a loan made to a non-UK...
April 2014 sees the pension lifetime allowance (LTA) cut from £1.5 Million to £1.25M. HMRC estimate that 30,000 people will be immediately affected by the cut and the consequences of breaking the limit are significant, a potential 55% tax charge...
Groups that are within scope of the restriction on tax relief for finance cost under WWDC cannot now reduce or remove their exposure to a restriction by having group members that do not have ordinary share capital. This change applies...
This is the headline in the Sunday times today. It refers to a film partnership investment which offered tax advantages which weren't aligned with the commercial investment of the individuals. The planning (or scheme depending on your viewpoint) basically involved...
The recent case of Julian Blackwell v HMRC considered whether the cost of getting out of an agreement could be treated as enhancement expenditure for capital gains purposes. Mr Blackwell’s holding of “A” shares in the eponymous publishing company (“BPH”)...
Legislation will be included in Finance Bill 2014 to amend the targeted anti-avoidance rule in s184G-I TCGA 1992. There are three TAARs within TCGA 1992 to counter arrangements which seek to obtain a tax advantage through the use of capital...
HMRC has updated its guidance on Disclosure of Tax Avoidance Schemes (DOTAS). The new guidance has effect from 4 November 2013. The changes to this guidance cover: The requirement for the user to give the promoter their national insurance number...
The Office of Tax Simplification (OTS) has now issued its second report on its review of employee benefits and expenses and the complexities in current legislation in this area. This report suggests radical reforms, building on the interim report issued...
The OTS has issued an interim report on the taxation of partnerships which sets out its longer-term agenda for reviewing how partnerships, including LLPs, are taxed and offers suggestions for improvements that could be made in the meantime. Whilst OTS...
HMRC are conducting a wide ranging review of the loan relationships rules in advance of making significant legislative changes in FA 2015. Some changes are being made in advance of the major revision of the loan relationships rules next year....
The professional bodies have issued a technical release on the availability of BPR in two situations. Firstly, where shares in unquoted trading companies are held by partnerships or LLPs. Secondly, where surplus cash is held by businesses and companies, which...
In P Donovan and related appeal (TC03188) the First Tier Tribunal rejected taxpayers’ appeals against HMRC’s determination that dividends paid to their wives should be assessed on them under ITTOIA 2005 s 624 (settlements in which the settlor retains an...
In Dr Samad Samadian v HMRC [2014] UKUT 13 the Upper Tier Tribunal entirely confirmed the First Tier Tribunal’s (FTT) decision .The case concerned whether tax relief was available for the travelling expenses Dr Samadian incurred in travelling between different...
As from accounting periods commencing on or after 1 January 2015 companies, other than those which use the FRSSE, will not be permitted to draw up accounts under existing UK GAAP. Companies will have to choose between one of three...
Under self-assessment, if HMRC are not satisfied with a taxpayer’s return an enquiry is opened. There is no statutory time period within which HMRC have to complete their enquiry. Only once a closure notice is issued by HMRC can the...
An adverse decision of the Tax Tribunal leaves a company with an unexpected £1m VAT bill on the sale of its business. The case is a salutary illustration of VAT complexity on what at first sight may appear to be...
The article written by Professor Dr Hans van den Hurk and published in the January 2014 edition of the Bulletin For International Taxation is a great addition to the debate on tax avoidance and transparency (following Mazars' own tax transparency...
HMRC expects to pass the necessary secondary legislation to activate the information exchange agreements with the Isle of Man, Guernsey, Jersey and Gibraltar as from 31 March 2014 and is consulting on the precise form of the SIs required. This...
In TC03118: Robert Brown the taxpayer claimed income tax relief on the basis that shares had become of negligible value. The only point of contention was whether the shares were actually of negligible value at 2006, the point at which...
HMRC has designated the market operated by The Channel Islands Securities Exchange Authority Limited as a recognised stock exchange under Section 1005 (1) (b) Income Tax Act 2007 with effect from 20 December 2013. Therefore as from 20 December 2013...
Until the introduction of the annual tax on enveloped dwellings (ATED) there were tax advantages in having high value residential properties owned by a company rather than personally. Since 6 April 2013 ATED imposes an annual “charge” of between £15,000...
The new CFC rules in Part 9A TIOPA allow groups to establish (or in some cases retain) tax efficient offshore financing arrangements under the finance company exemptions (Chapter 9). Provided the detailed conditions in are met, the CFC charge on...
The Upper Tribunal have agreed with the earlier FTT decision that the activity of a limited liability partnership did not amount to trading. The 2012 FTT decision received considerable publicity as many well known individuals were members of Eclipse Film...
In the UK, The Independent newspaper is today running the headline “Take from the poor, but not the rich”, following the publication of the UK Public Accounts Committee (PAC) report on HMRC tax collection. The main challenges to HMRC were...
Today Vodafone published its own “tax transparency” report. Channel 4 news has covered the story, quoting Richard Murphy describing it as “smoke and mirrors”. Other criticisms of the report are “selective PR” and a “long excuse for (poor) behaviour”. What...
In the two weeks since the launch of Mazars response to the Tax Transparency debate we have received considerable interest from business, media and from non-government organisations (NGOs). It is clear from our discussions with businesses ranging from global, brand...
Another day / another tax related story on the front page of the daily newspapers, this time it is the owners of the chemist Boots charged with moving UK profits offshore. Someone once said there is no such thing as...
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