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The Tax Law Rewrite Project has published various draft clauses on corporation tax for public consultation.The clauses cover the following areas:Currency;Relief for employee share acquisitions;Unauthorised unit trusts; andLoan relationships.Comments on the clauses are invited by 3 August 2007.Explanatory Notes are also available for each topic covered.LinkHMRC: Consultation Papers, Exposure Drafts and Response Documents Continue Reading

HMRC have published a Technical Note setting out their approach to Discounted Gift Schemes (DGS) and their interaction with the Inheritance Tax (IHT) legislation.In particular, the note examines the valuation of lifetime transfers and the underlying valuation methodology. It also sets out the approach HMRC will adopt in joint settlor cases, which, in some cases, will be more precise than that adopted up to now.Whilst there are no fundamental changes to HMRC's overall approach towards ... Continue Reading

HMRC have announced that they are "seeking to clarify" the position regarding some Self Assessment Surcharge Notices, which were issued in March.These notices were due to be sent from Accounts Office Cumbernauld during the month of March, but were subsequently subject to a delay in despatching. HMRC have advised that if a taxpayer makes a late appeal as a direct result of the delay in receiving the original notice, they will accept this as a ‘reasonable excuse’ for the purposes ... Continue Reading

HMRC have published a short guide for payroll professionals covering the new Tax Avoidance Disclosure (TAD) regime, which takes effect from 1 May 2007.The new rules are designed to give HMRC early warning of new avoidance schemes and inform anti-avoidance legislation and compliance work. HMRC describe TAD as being designed to "capture new and innovative schemes". Prior to 1 May 2007, a person who had to disclose a scheme for both tax and NICs could make a single disclosure. The only ... Continue Reading

Toby Harris LLB CTA TEP considers the recent decision in Phizackerley v CIR and its possible implications, offers some practical advice to taxpayers. Introduction The case of Phizackerley v CIR may have worried people unnecessarily. The existence of the problem had been known for some time but the particular circumstances that have been highlighted by the case will naturally give cause for concern. This note has been prepared for the benefit of our clients as an initial response and to provide ... Continue Reading

Andrew Needham, Director of VAT Solutions (UK) Ltd, highlights a further selection of VAT cases.Tribunal says that customer ‘cash back’ payments did not reduce the ‘taxable amount’The Appellant sells mobile phones to the public, and centred its appeal around two main issues at the Tribunal hearing. The first issue was that the Appellant entered into bilateral arrangements with some customers that are quite distinct from tripartite arrangements involving the service providers ... Continue Reading

Matthew Hutton MA, CTA (fellow), AIIT, TEP, author of Capital Tax Review, warns of a potential nightmare scenario on the retirement and appointment of trustees. ContextThe issue in this case was whether for purposes of Trustee Act 1925 s37(1)(c) a trustee would be properly discharged, on the basis that a company was an ‘individual’.Jasmine Trustees Ltd and Others v Wells & Hind (a Firm) and Another: the factsThe family settlement was constituted by Major-General and Mrs Coaker, both ... Continue Reading

A quick guide to recent additions to the HM Revenue & Customs website.Week ending 27 AprilWhat’s new?Self Assessment and tax equalised employees: A revised version of Help Sheet IR212 for the Employment Pages of the 2006-07 Tax Return;Construction Industry Scheme: A note amplifying the guidance provided in the quick guide for agents published in March 2007;Revised joint NICs elections: updated model available;Research Report 28 – The Customer Experience of the Re-Engineering Compliance ... Continue Reading

Some employers who have been submitting their 2006-07 PAYE return forms online have received an error message due to incorrect validation.Some employers using aggregation when calculating National Insurance Contributions for employees have been receiving an Error Message 7130 and/or 7140 when they send their PAYE return to HMRC electronically. HMRC have confirmed that this is due to incorrect validation for 2006-07 but there is a workaround available.Employers receiving these errors can enter £1.00 ... Continue Reading

The Tax Credits (Definition and Calculation of Income) (Amendment) Regulations 2007 (SI 2007/1305) have been laid before Parliament and come into force with effect from 16 May 2007.This statutory instrument amends the Tax Credits (Definition and Calculation of Income) Regulations 2002 (SI 2002/2006), to reflect that certain areas,previously covered by the Finance Act 1990 and ICTA 1988, are now covered by the Income Tax Act 2007.The amendments to the 2002 regulations result from changes to other ... Continue Reading