Latest Legal News

Construction Industry VAT Changes Ahead

Businesses in the construction industry are reminded that on 1 October 2019 the new VAT domestic reverse charge will come into force. This is being introduced as an anti-fraud measure and will see a major change in accounting for VAT on some construction...

HMRC Errors Lead to Loss of Tax

Although getting one's tax return right is to be recommended, there are many grey areas in tax and, when HM Revenue and Customs (HMRC) make mistakes at their end, the effect can be to exonerate the taxpayer from liability for all or part of the tax, interest...

Enabling Tax Non-Compliance

There are hundreds of thousands of companies in tax havens and the true commercial value added by them is probably trivial, whereas the tax avoided or evaded runs into billions, so it is no wonder that governments are mounting an ever-increasing effort to...

Disguised Remuneration Clarification By HMRC

An attack by HM Revenue and Customs (HMRC) on 'disguised remuneration' schemes, wherein a director of a company takes money out of the company in the form of a loan which is never intended to be repaid, has been widely reported. Such schemes were widely...

Three Quarters of Firms Not Aware of Anti-Tax Evasion Law

A recent survey by HM Revenue and Customs (HMRC) shows that only one in four UK businesses are aware of the penalties they could face under the Criminal Finances Act 2017 if they fail to prevent the criminal facilitation of tax evasion by any person or...

Company Can Reclaim VAT on Director's Legal Bills

Companies understandably may wish to provide financial as well as moral support to their directors if they are facing litigation. However, the issue of whether such contributions are tax deductible is far from straightforward and exercised the minds of...

Company Director Banned for Ignoring Obligation to Pay Tax

Directors of struggling companies all too often place payment of tax at the bottom of their priority lists, with the result that it is the public purse that frequently suffers most in the event of insolvency. However, as a High Court decision showed , such...

Court Ruling Boosts HMRC's Cross-Border Powers

National boundaries pose little or no obstacle to tax evasion. The Court of Appeal made that point in an important ruling which has greatly boosted the ability of HM Revenue and Customs (HMRC) to pursue inquiries beyond the borders of the UK. HMRC were...

Online Selling - What About the VAT?

It is often optimistically considered that trading on eBay and similar online sales platforms is effectively outside the tax system. That, of course, is not true and anyone undertaking economic transactions for profit needs to comply with the tax laws to...

Digital Filing - Bar Set High for Opt-Out

The 'making tax digital' project will require VAT-registered businesses to submit their VAT returns online from 1 April 2019 and to use accounting software that is integrated with the Government's digital gateway to do it. This in turn means, in effect, that...

Does Your Business Owe the Tax Man?

If your business is struggling to meet VAT and other tax payments on time, take advice quickly. The decision by the Government to restore 'Crown preference' regarding debts due to the Exchequer from April 2020 could impact negatively on you. Leaving aside...

Does a Director Need to File a Tax Return?

There is a widespread belief that every UK company director has to file a tax return. Indeed, the Government's own website suggests that being a company director alone means you should register for self-assessment and file a tax return annually. However,...

All Change for VAT on Vouchers

If your business issues vouchers, you should be aware that the VAT regime will change significantly on 1 January 2019. From that time, the VAT treatment of a voucher will depend on whether it is a 'single purpose' voucher or a 'multi-purpose' voucher. A...

Typhoon Disruption is Reasonable Excuse for Late Tax Payment

It is fair to say that HM Revenue and Customs (HMRC) take a hard line when it comes to non-payment or late payment of taxes due. Unless the taxpayer can show a 'reasonable excuse' (which in practical terms means a really compelling reason) for the delay,...

Shareholders to be Liable for Company Tax?

One of the motivations for setting up a limited company is that the risk for the shareholders is limited to the investment they have made in the company's shares. A quietly launched consultation document issued by HM Revenue and Customs (HMRC), which...

VAT - 'Pay Now, Appeal Later' Rule Receives Supreme Court Blessing

Unless they can show that they would suffer hardship as a result, traders who wish to challenge assessments to VAT are first required to pay, or at least deposit, the tax demanded before they can mount an appeal. That requirement has long been highly...

Private Rental Landlords Facing Double Whammy

Tax changes that affect residential landlords have sparked a massive sell-off, with 133,000 rental properties likely to be sold in the next year according to a survey by the Residential Landlords Association. In the year ended 31 March 2017, 46,000 let...

Tax Mitigation Scheme Failure Proves Disastrous

Collecting debts is often a long and arduous process, but the use of bankruptcy proceedings can be an effective means of bringing matters to a head. That was certainly so in one case in which a businessman tried, but failed, to avoid bankruptcy in respect of...

Failure to Meet Criteria Means Loss Relief Denied

There are all sorts of things one can do with trading losses under Corporation Tax (CT), but the fall-back position is that losses can be carried forward and set against the next available profits 'of the same trade'. That sounds very simple...and...

Future Intention Leads to Tax Charge

The additional rate of Stamp Duty Land Tax (SDLT) is payable on purchases of 'additional dwellings' such as buy-to-let properties. A recent case dealt with the SDLT implications of the 2015 purchase of a house which the purchaser (a company) intended to...

The Taxation of Termination Payments

The rules governing the taxation of termination payments have been tightened with effect from 6 April 2018 by means of legislation to amend Chapter 3, Part 6 of the Income Tax (Earnings and Pensions) Act 2003 . Hitherto, where the employee's contract of...

Guesswork Not Enough to Create Tax Liability

When HM Revenue and Customs (HMRC) suspect serious tax evasion, they will normally launch a full-scale tax investigation into the person they suspect. They use many tools in such investigations and one of the more common ones is to compare the cost of a...

HMRC Reliance on Guidance Not Justified

The various VAT 'flat-rate' schemes were originally set up with the ostensible purpose of simplifying the VAT process for those using them, while being essentially revenue neutral for HM Revenue and Customs (HMRC). A recent case dealt with a situation in...

Son's Casual Employment Proves Expensive for Dad

One area in which problems may not be anticipated is when a family member's status as a 'genuine' employee is disputed by HM Revenue and Customs (HMRC). For any expenditure to be deductible for tax purposes, it must be 'wholly and exclusively' made for...

Seeking to Waive Dividends?

For a person who has no need of the income from a family company, a dividend waiver, which allows other shareholders to receive dividends but not the person who has executed the waiver, can be a useful device. However, the use of dividend waivers can...
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