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Matthew Hutton MA, CTA (fellow), AIIT, TEP, considers a potential application for reverter to settlor trusts for inheritance tax and capital gains tax purposes.Matthew HuttonContextReverter to settlor relief (IHTA 1984, s 53(3)) under the 2006 Inheritance Tax (IHT) regime for trusts depends upon the trust property reverting outright, rather than on a continuing trust, which would (unless a transitional serial interest, or TSI) fall into the relevant property regime.  But the Capital Gains Tax ... Continue Reading

Andrew Needham of VAT Solutions (UK) Ltd provides the first part of an update on recent VAT decisions.Court of Appeal says theatre production costs are 'residual' for partial exemption purposesAndrew NeedhamThe Court of Appeal (CoA) has released its judgment in what is likely to be an important future case when attributing input tax.The issue was whether the VAT on production costs was wholly irrecoverable as relating exclusively to the exempt sales of tickets ... Continue Reading

John Andrews examines recently updated guidance by HMRC on how complaints can be made by its 'customers'.IntroductionFor years HMRC and its predecessor organisations have admitted that they really ought to do better at handling the complaints of its customers.So it is doubly disappointing that the new HMRC have not yet been able to build upon even their own best practice as they introduce a new approach to complaints.On 3rd May HMRC announced the withdrawal of its existing complaints leaflets ... Continue Reading

A quick guide to recent additions to the HM Revenue & Customs website.Week ending 8 JuneWhat’s new?Revised form CWF1: Becoming self-employed and registering for National Insurance Contributions and/or tax;Revised Contracted-out Guidance Booklets CA14C, CA14D, CA14E and CA16A;PEP & ISA Bulletin number 39;Announcement that HMRC are currently experiencing an issue with new stamp taxes registrations;Updated Qualifying Recognised Overseas Pension Schemes (QROPS) list;Charities and bond-washing ... Continue Reading

Complex and international companies will be under more scrutiny than ever before, say leading business and financial advisors Grant Thornton.HMRC are due to implement a new approach to compliance risk management, which will be put into practice for the largest businesses by the end of this year. Under the new approach, companies assessed as high risk are highly likely to face intense scrutiny compared to those that are considered low risk, which will receive very limited enquiries for up to three ... Continue Reading

During a week in which the House of Lords has listened to the infamous dispute between HMRC and Mr and Mrs Jones (Arctic Systems), HMRC have published their litigation and settlements strategy (LSS) document, setting out principles for bringing tax disputes to a conclusion, whether by agreement with the taxpayer, or by litigation.The aim of the LSS is to ensure that HMRC conduct disputes in a way that is professional, effective and that supports their objectives to close the tax gap and provide ... Continue Reading

The House of Lords will give a concluding hearing in the case of Jones v Garnett ("Arctic Systems") this week.This case focuses on whether dividends paid by the company (Arctic Systems Limited) to a working shareholder (Mrs Jones) consisted of income arising under a settlement as defined by ICTA 1988, s 660A(1) and so should be treated as the income of her spouse, who was a director and IT contractor.This case is of particular importance because it examines whether, in a husband and wife ... Continue Reading

Regulations have been laid before Parliament, which add to the list in VATA 1994, Schedule 7A, items which qualify for the reduced rate of VAT.From 1 July 2007, the reduced five per cent rate of VAT applies to the installation of mobility aids for the elderly and related supplies of the mobility aids themselves. It is hoped that this reduction will make such services and products cheaper, thus enabling more elderly people to continue to live independently in their own homes or with relatives.In addition, ... Continue Reading

Further Regulations have been laid before Parliament, which add to the group of statutory instruments that have been made as a result of the introduction of reverse charge accounting in relation to the supply of certain goods of a kind used in missing trader intra- community fraud (MTIC).The Value Added Tax (Amendment) (No. 4) Regulations 2007 (SI 2007/1599) come into force on 1 July 2007.MTIC fraud  arises through contrived transaction chains involving supplies of high value goods with the ... Continue Reading

James Bailey, CTA, highlights potential pifalls in a property tax planning strategy.  James BaileyIntroduction This is a strategy that we have been hearing a lot about recently. Essentially, the proposition is that if you own a buy to let property you can release equity from it by remortgaging in order to provide yourself with spending money, and as long as you never sell the property, you will never have to pay CGT. It seems that this idea is being promoted in some quarters as the 'golden ... Continue Reading