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Less than two weeks after resigning as the Chairman of HM Revenue and Customs when a large amount of computer data went missing, Paul Gray CB, is back working for the government.Channel 4 News reported that he had begun a short-term Cabinet Office post and is still paid more than £200,000. But a government spokesman said Mr Gray's period of notice meant he would continue to be paid until 31 December whether he was working or not. "In the meantime he has agreed to a request from Cabinet ... Continue Reading

A new tax information exchange arrangement (TIEA) between the United Kingdom and Bermuda was signed in London on 4 December 2007.TIEAs allow governments to enforce their domestic tax laws by exchanging, on request, information relevant to a tax matter covered by the arrangements. The new TIEA between the UK and Bermuda is the first comprehensive agreement to be signed by the UK and covers both direct and indirect tax matters. This follows the OECD Model Agreement on Exchange of Information on Tax ... Continue Reading

HMRC have published revised Advisory Fuel Rates, which take effect from 1 January 2008.Fuel Advisory Rates are mileage rates set by HMRC to reflect actual annual running costs of cars. If the rate paid per mile of business travel by employers is no higher than the advisory rate for the particular engine size and fuel type of the car, HMRC will accept that there is no taxable profit and no Class 1 NICs liability. The aim is to save time for both employers and HMRC by setting out some figures ... Continue Reading

Steve Allen, Director of VAT Solutions (UK) Ltd, offers some practical advice on dealing with a VAT inspection by HM Revenue & Customs.  Steve AllenIntroductionOne of the most stressful events that can happen to any business is the prospect of a VAT inspection. It’s believed that VAT Officers now have aggressive targets to meet, so are looking for businesses that have obvious mistakes and the cash to put them right.  Some accountants say that for every 7-10 years in business, ... Continue Reading

Matthew Hutton MA, CTA (fellow), AIIT, TEP, presenter of Monthly Tax Review (MTR), highlights HMRC’s view on the CGT treatment of qualifying corporate bonds after 5 April 2008, and on the possible application of income tax anti-avoidance rules on a share sale.Matthew HuttonQCBs – HMRC’s AnalysisA Policy Adviser for Capital Gains HMRC, has responded to a number of specific queries about the effect of the revisions on QCBs as follows:‘You are asking about the way held over ... Continue Reading

Leigh Sagar, Barrister, examines the application of permanent establishment rules to the trustee residence of offshore corporate trust service providers ('TSPs'), following changes introduced in Finance Act 2006 ('the 2006 Act') .Leigh SagarResidenceResidence is important for liability to tax. For settlements, liability for tax on income and capital gains depends to a large extent on whether the trustees as a body are treated as resident or non-resident in the UK. Essentially:if they ... Continue Reading

The Chartered Institute of Taxation (CIOT) is calling for the proposed capital gains tax (CGT) changes for trusts and companies set up by UK resident non-domiciliaries to be deferred until a proper assessment can be made of the impact on the UK economy.Commenting on the proposals announced in the 2007 Pre-Budget Report in October, John Barnett, CIOT spokesman, said:"As well as introducing a £30k p.a. charge for non-doms, the pre-Budget report proposals also made vague reference to ... Continue Reading

HMRC have received legal advice regarding the application of IHTA 1984, s. 161(4) when valuing shares of land as related property, and have issued some new guidance accordingly.Broadly, IHTA 1984, s. 161 provides that, when valuing a share of property for inheritance tax where the spouse or civil partner also has an interest in the same property, the spouse’s or civil partner’s interest is taken into account. The effect is to reduce the level of discount that smaller, un-aggregated shares ... Continue Reading

PKF Accountants and Business Advisors believe that extending the Enterprise Investment Scheme (EIS) from next April so that owners of start-up businesses can qualify for the CGT relief as well as investors would be a clear signal that the Chancellor is serious about rewarding investment and simplifying the tax system.With the Chancellor under fire from all sides, he can still seize the opportunity to turn the furore over his capital gains tax (CGT) reforms into a chorus of approval by boosting ... Continue Reading

As promised, HMRC have published revised guidance following the decision in the Arctic Systems case.When the decision was given in the House of Lords in the case of Jones v Garnett (the “Arctic Systems” case) HMRC published interim guidance about the application of the settlements legislation to cases similar to Arctic Systems.When the interim guidance was issued HMRC promised to issue further, more detailed, guidance in the autumn. This guidance is now available in the ... Continue Reading