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A brief guide to the process of getting a case heard before a tax tribunal, by Andrew Needham of VAT Specialists Limited. Appealing to the Tax Chamber If you receive an assessment or ruling and following an internal review HMRC maintains that it is correct the next step is to appeal to the Tax Chamber of the Tribunal Service. In the first instance the appeal is to the First-tier Tribunal with the right of a further appeal to the Upper Tribunal.  An appeal to the Upper Tribunal has to ... Continue Reading

Mark McLaughlin looks at the Government's proposed rules dealing with 'controlling persons' and their implications. Personal Service Companies The government announced in Budget 2012 that measures would be introduced to tackle avoidance through the use of personal service companies. It was also announced that there would be consultation on legislation requiring 'controlling persons' who are integral to the running of an organisation to have PAYE and NIC deducted at source by the organisation ... Continue Reading

HMRC Contact Centres - It's Not Just About Speed Mark McLaughlin casts a critical eye over HMRC's recent promise to increase call centre resources. I was pleased to see the recent announcement by Lin Homer, HMRC's Chief Executive, that an additional £9 million is being invested this year in recruiting up to 1,000 additional contact centre staff, with a further £25 million being spent during 2013/14, with a view to bringing HMRC contact centres up to speed two years earlier than originally ... Continue Reading

Andrew Needham discusses recently updated proposals for changes to the VAT rules. Consultation Document The proposal as set out in the Consultation Document was that all the changes would take effect from 1 October 2012 and that transitional arrangements would be available for alteration works to listed buildings. The consultation was a technical consultation on the draft legislation and analysis published within the consultation document, and not a consultation on whether to proceed ... Continue Reading

Electricians' Tax Safe Plan Electricians have just one week to pay any undisclosed tax that they owe under an HM Revenue & Customs (HMRC) campaign. Under the Electricians' Tax Safe Plan, electricians can pay any tax and interest they owe, and receive penalties of only 10 per cent. Normally, penalties of up to 100 per cent of the tax owed can be charged, with criminal investigation possible in the worst cases. The campaign is aimed at anyone who installs, maintains and tests electrical ... Continue Reading

Peter Arrowsmith, FCA, with his monthly update of all things National Insurance - and a warning that HMRC advice on the IR35 Calculation is incorrect! Tax and NIC Merger Following my unusually optimistic report last month, I’m now less optimistic. In a Commons Written Answer on 4 July, David Gauke describes what we are going to get in the autumn as ‘an update on this work’ – not the consultation document that we were promised at the end of May. Maybe the doom-mongers ... Continue Reading

Mark McLaughlin looks at what constitutes a 'business' for Capital Gains Tax Incorporation Relief purposes. Introduction The incorporation of a business will often involve the disposal by a sole trader or partnership to a company of chargeable assets for Capital Gains Tax (CGT) purposes, such as free goodwill or land and buildings. The disposal will normally be treated as taking place at market value for CGT purposes, on the basis that the parties are connected persons (TCGA 1992 s 18). ... Continue Reading

Peter Vaines of Squire Sanders LLP considers some interesting tax cases in his monthly tax bulletin. Loans to Participators The Tribunal recently had occasion to consider whether a loan had been made to a participator within the meaning of ICTA 1988 s 419 (now CTA 2010 s 455) : Aspect Capital Limited v HMRC TC 2112. The issue was whether an employee acquiring shares in the company under a facility provided by a third party and discharged by the company, was in receipt of a loan from ... Continue Reading

Mark McLaughlin considers the circumstances in which undisclosed company profits can be taxed as loans to participators. Introduction It is not uncommon for HMRC enquiries into the business accounts of an individual or company to result in additions to turnover and profits. For example, unexplained lodgements into a private bank account will probably result in HMRC seeking to assess them as undeclared takings. HMRC will more than likely contend that the accounting double entry in those ... Continue Reading

In the current economic climate, offering a tax efficient option may make the difference between securing a potential investment and not. Sarah Brock, Corporation Tax Manager at Ward Williams, considers some of the opportunities available to encourage investment. Business Structure Before considering the potential tax incentives available to investors, it is worth taking the time to consider the structure of the business. The main tax incentives available to investors are available only ... Continue Reading