Author Archives: Graeme Blair - Partner

About Graeme Blair - Partner

T +44 (0)20 7874 8835

Graeme helps guide businesses through the corporate tax world. He is particularly expert at issues that property companies and professional practices have to navigate and therefore often manages large and complex assignments, many of which have an international element.

As a client of Graeme's wrote "I am increasingly impressed that when I pick up the phone to Graeme I receive robust and appropriate advice."

Ideally there would be no tax on a gift and much succession planning is based around eliminating these taxes.

Family Giving: Passing family business and other wealth between the generations

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 15th December 2016

Categories:

To be successful in X Factor a competitor needs at least three yesses to follow their dreams. In the world of family giving you need to overcome only two hurdles. That doesn’t necessarily mean that family giving is any easier than progressing through the rounds of X Factor.

Grandson With Grandfather And Father Opening Christmas Gifts

When one gifts down through the family generations the two taxes which need to be considered are Capital Gains Tax and Inheritance Tax.

Capital Gains Tax

Capital Gains Tax (CGT) is the tax when an individual disposed of an asset, whilst Inheritance Tax can be considered the additional tax on transferring that asset. The Government appreciate that it wouldn’t be right to charge both on a single transaction and therefore there are various reliefs which can be claimed to prevent one of them applying. Ideally there would be no tax on a gift and much succession planning is based around eliminating these taxes.

Gifting Sterling

Capital Gains Tax is only chargeable on certain assets. A commonly gifted asset which has no CGT implication is gifts of Sterling. You will note that I am very specific about the currency. If a gift is made in a currency other than Sterling then there could be Capital Gains Tax considerations.

Gifting Shares

If the gift is of shares in a trading business and the recipient of the gift is a UK tax resident, then there may be the possibility to jointly elect with the donor to holdover or delay the gain element. This effectively means that the donor does not pay any CGT on the gift but the recipient acquires the asset at the same base cost as that applicable to the donor. At best this is a tax deferral as the recipient will pay more tax when they sell the shares.

If the business is not a trading business it may be possible to undertake a demerger to allow a business which would otherwise not qualify for this relief to become qualifying.

Potentially Exempt Transfers

Most gifts of assets are potentially exempt transfers (PETs) for Inheritance Tax (IHT) purposes. In simple terms this means that the gift becomes free of IHT should the donor survive seven years from the date of the gift. To be a PET the gift must be unfettered and there has been talk for many years about the risk of HMRC extending the seven year period to something longer. If the donor dies within the seven year window then not all of the gift falls into IHT. The potential liability tapers away within the seven years and it is possible to buy life assurance which would cover the tax should it become payable within that window.

IHT and CGT

If you pause at that point it would appear that Capital Gains Tax is the primary concern. This is because gifts could potentially be exempt from IHT due to the seven year rule.

Gifts into certain structures can give rise to an immediate IHT charge. In order to prevent both IHT and CGT being payable on the same commercial transaction it is then possible to make a tax election to prevent the CGT being payable. Depending on value and circumstance the IHT may be less than the CGT which would otherwise be payable. This can lead to planning whereby an IHT charge of nil or a modest value is deliberately generated in order to avoid a higher CGT cost. This planning needs to then be tempered with the cost of running the resulting structure or the future cost of unwinding it.

Gifting shares in a trading businesses in a Will

Many trading assets are exempt from IHT. As an alternative to gifting during life and having the recipient take on the donor’s Capital Gains Tax base cost it may be more efficient for the donor to retain the asset and leave it to the recipient in their Will. At death there is no IHT on the trading asset and the asset is transferred to the individual at its market value as at the date of death.

This has led to planning involving business owners and their elderly parents. The business person gifts shares in the family company to their elderly parents and holds over the capital gain. The understanding is that the Will of the elderly parent transfers the asset back to their child. With the right fact pattern the death of the parents does not lead to any Inheritance Tax on the shares and the business person reacquires the shares from the estate of their parent with an uplifted base cost of the assets.

You could say that was a yes, yes and yes.

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The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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one of the concerns about incorporating a buy-to-let business is the Capital Gains Tax which is payable. With the cash resources and the appropriate appetite for risk this concern can be partially alleviated by use of EIS investments.

Should I Incorporate My Buy-To-Let Property? – Part 2

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 11th October 2016

Categories:

Thirty-two colourful British doors from the past few centuries. Full resolution is 300dpi.

Richard Verge’s blog of 25 January asked the question should I incorporate my buy-to-let business?

It was aimed at UK persons who were looking to mitigate the impact of a future restriction of the tax relief for interest payments on their buy-to-let mortgages and the impact of the 3% SDLT increase for second properties.

Capital Gains Tax

Incorporation comes at the cost of an SDLT charge on transfer of the property into a company and the Capital Gains Tax payable on the transfer. As the company is connected with the seller the CGT is payable on the full market value of the property irrespective of the price recorded in the documentation.

Residential property

When CGT rates were reduced to 10% or 20% on 6 April 2016 the reduction did not apply to gains on disposal of residential properties. The impact is that individuals who incorporate will pay Capital Gains Tax at rates of either 18% or 28% on the gain they make on that property. This “dry charge” is a disincentive for incorporation. However this CGT rate could be reduced to 10% or 20% by investment in Enterprise Investment Scheme (EIS) shares.

Enterprise Investment Scheme

Capital gains on sale of property can be deferred if the vendor invests in EIS qualifying shares. The reinvested gain would be deferred for the period that the shares are held. When the EIS shares are sold the deferred gain becomes taxable at the rate of CGT applying at the time of the share sale. The CGT which is payable is no longer classified as a disposal of residential property but a deferred gain and therefore charged at 10%/20%. Due to a technicality this opportunity only applies to investment in EIS qualifying shares and does not apply to Seed Enterprise Investment Scheme qualifying shares.

As well as CGT reliefs, a qualifying investment in EIS shares which are held for a minimum period of (generally) three years results in a 30% income tax relief for the subscriber.

In summary, one of the concerns about incorporating a buy-to-let business is the Capital Gains Tax which is payable. With the cash resources and the appropriate appetite for risk this concern can be partially alleviated by use of EIS investments.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

Comment on this...

The proposals are relevant to individuals and partnerships of individuals with unincorporated property businesses. It is proposed that the cash basis would also be available to eligible non-UK resident landlords.

Making Tax Digital: Simplified cash basis for unincorporated property businesses

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 29th September 2016

Categories:

MTD

The government is consulting on introducing the choice to use the simplified cash basis currently available to some unincorporated traders. As for traders, adoption of the cash basis would be optional. As the cash basis rules would be designed with the simplest businesses in mind, they may not be the right choice for all eligible unincorporated property businesses. Landlords will therefore be free to choose the basis which works best for their business.

The cash basis method of calculating tax works on a cash in, cash out basis. Income is only recognised when it is received and expenses when they are paid.
At present, property businesses must use the same accountancy rules as most other businesses, including trading businesses, when they work out their profits. Calculation of profits must be done in accordance with Generally Accepted Accounting Practice (GAAP). GAAP uses the accruals basis (sometimes referred to as the earnings basis) which recognises income earned and the expenses incurred in earning that income in a period (whether or not the amounts have actually been received or paid).

Who does this apply to?

The proposals are relevant to individuals and partnerships of individuals with unincorporated property businesses. It is proposed that the cash basis would also be available to eligible non-UK resident landlords.

Does not apply to

The proposals do not apply to company property businesses, trusts, holders of units in unit trusts, real estate investment, trusts, and partnerships with corporate members, limited liability partnerships and other similar, more complex entities would not be able to use the cash basis.

Types of businesses

Unincorporated property businesses can take several different forms; a UK property business or overseas property business could include residential or commercial properties, furnished holiday lettings or receipts to which the rent-a-room scheme applies.

General Principles of the proposal

The cash basis would not change the underlying principles of what expenditure is allowable in calculating the profits of a property business. As with the accruals accounting basis, expenditure must be incurred wholly and exclusively for the purpose of the property business to be tax deductible and withdrawal of cash from the business will not affect the calculation of profits. Adopting the cash basis would simply change the time when deductible expenditure is recognised.
As with the current rules, those amounts which would normally be chargeable under the Capital Gains regime would continue to fall within that regime and not be property income for income tax purposes, for example, premiums on long leases or the sale of the property.
Some receipts which are not treated as property income receipts under the accruals accounting basis would be income receipts under the cash basis, for example, the proceeds from the sale of a van used for the property business where the cost has been deducted when initially purchased. Also, some events, such as a change of use of such an asset from business to personal use, would require the current value of the asset to be treated as an income receipt.

The cash basis should also help property businesses to calculate their taxable property business profit for any given period therefore making the move to quarterly digital updates as smooth as possible.

No “relevant maximum” for eligible unincorporated property businesses

One of the eligibility criteria for the cash basis for trading income is that the total cash basis receipts for all trades carried on by a person in a tax year does not exceed the “relevant maximum”. The relevant maximum amount for a tax year is the VAT registration threshold at the end of that tax year (£83,000 for 2016/17) or twice the VAT registration threshold for Universal Credit claimants. The government is not intending to impose a relevant maximum limit on entry into the cash basis for eligible unincorporated property business. The eligibility criteria will instead only be based on whether the unincorporated property business is carried on by an individual or partnerships of individuals.

Restriction of finance costs

The cash basis for trading income has a restriction on interest expense, with a maximum of £500 allowable as an expense for interest and other costs paid on cash borrowings. Under the cash basis for unincorporated property businesses, there would also be a restriction on interest expenses and other costs paid on cash borrowings. For those with residential properties, relief for interest will continue to be restricted to the basic rate of income tax, in accordance with the restriction of finance cost relief for individual landlords introduced in the Summer Budget 2015.
Regardless of which method is used whether the accruals or cash basis, the same amount of relief for interest (and other borrowing costs) on mortgages should be available. Any difference would purely be the timing of the relief.

Summary of Consultation Questions

Question 1 Do you feel there should be a relevant maximum limit imposed for eligibility for the cash basis for unincorporated property businesses? If so, what should this limit be and why?
Question 2 Do you feel there is any reason why the cash basis should not be optional for all eligible unincorporated property businesses?
Question 3 Would you want to opt in for each of their property businesses separately (for example, UK property business and overseas property business) or would they prefer to choose whether to opt in for all their property business
income or none of it?
Question 4 Does the above advice give you enough information to decide whether or not to use the cash basis with/without (please indicate) professional advice? If not, what else would you need to know about the new rules?
Question 5 Does a regime that allows for individuals letting jointly, not in partnership, to separately opt to report using the cash basis present particular difficulties or issues
Question 6 Should eligibility for the trading cash basis affect eligibility for the cash basis for unincorporated property businesses? If so, do you have any suggestions on what this interdependence should be?
Question 7 Would only recognising deposits that landlords are entitled to keep at the end of a tenancy create unnecessary complexity?
Question 8 Do you feel there is anything which has not been considered which could make the cash basis as simple as possible for landlords?
Question 9 Are you aware of any risks that the cash basis for
unincorporated property business could present which could lead to the avoidance or reduction of liability to income tax? If so, please provide details.
Question 10 Do you have any comments, not already provided, on any aspect of the proposal?
Question 11 If the government introduces a simpler tax system for unincorporated property businesses, please provide details of how this will affect your business. This should include details of both the expected one-off and ongoing benefits and costs of:
a) Familiarisation with the new basis and updating your software or systems.b) Not having to keep accruals accounts and prepare calculations in accordance with UK GAAP.
Question 12 Please tell us if you think there are any other benefits or costs not covered in the summary of impacts.

What do you think?

We will be responding to HMRC’s consultation and making representations on our clients behalf so please let us have your views by emailing MTD@goodmanjones.com.

Other areas covered by the consultation

This is only one part of the consultation. See summaries of the other areas here.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

Comment on this...

Businesses, sole traders and landlords who keep digital records would be able to budget towards their tax bills by having the facility to make voluntary payments on a PAYG basis

Making Tax Digital: Voluntary Pay As You Go

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 29th September 2016

Categories:

MTD

Businesses, sole traders and landlords who keep digital records would be able to budget towards their tax bills by having the facility to make voluntary payments on a PAYG basis in respect of expected IT, NIC and CGT liabilities from 1 April 2018. The method will also apply to VAT from April 2019 and CT for unincorporated businesses from 2020.

The facility to pay these taxes voluntarily as you go will not change the normal due dates for each tax liability, so the usual non-voluntary tax payments will still be due on their respective deadlines if the amounts are not already covered by voluntary payments.

HMRC will allocate each voluntary payment against any tax liabilities as they become due. The method of allocation will be clearly set out on the digital account to give an integrated picture across all of a customer’s taxes. This will prevent non-payment of a specific tax.

Smoothing out cash flow

It is hoped that PAYG will ensure there are no shocks or problems down the line, and could thereby improve cash flow and reduce exposure to late payment penalties and interest charges, particularly if repayments are able to be made earlier.

HMRC want to increase flexibility for its customers by allowing them to decide how often and what amount they want to pay at any time: choices which can be amended if needed.

Digital Account

They may also pay at the same time as they submit an update on their digital account, or more regularly by direct debit. HMRC wish to make sure that these regular sums will be clearly visible on a customer’s account and making any changes will be a simple process.

They aim to protect contributions towards benefit entitlements, ring fence sums for onward transmission (i.e. in relation to VAT) and review the appropriation order where more than one tax is due and payments made are insufficient to cover them all.
HMRC anticipates that there will be a digital facility to request a repayment of an unallocated voluntary payment if a customer’s circumstances change. However, a repayment may be restricted where a tax liability will shortly become due for payment. Comments are invited on whether this is a reasonable approach.

Security

Minimum/maximum payment limits may be needed for security, as well as anti-fraud and money laundering provisions, especially if a bank account is linked up to the digital account.

With regard to payments on account, HMRC envisage that the digital account would compare the estimated tax liability shown by the updates with the actual payments due, and recommend either making further payments or the option to reduce POAs.

They also wish for customers to be able to elect for overpaid credits to be held on their digital account as a voluntary tax payment rather than being repaid to the customer.

In this case, no overpayment interest would then be payable, but otherwise, current interest rules on under/overpayments will continue to apply, subject to the consultation responses.

Partners could see their estimated liabilities flow through from a partnership’s own account.

Third parties may make a payment on behalf of a customer using the correct reference, but repayment to a third party may be an issue.

Summary of Consultation Questions

Question 1: Do you see any challenges with the voluntary payments process described? Do you think there are alternative options that should be considered, and if so, what are these?
Question 2: Do you have any views or suggestions on the display of voluntary payments in the digital tax account?
Question 3: Should there be a ‘period of grace’, and if so, what period would be appropriate to allow for separate payment of an amount becoming due?
Question 4: Do you have any general comments to make on the allocation of voluntary payments?
Question 5: Do you foresee any problems with HMRC’s intended approach to the allocation of voluntary payments?
Question 6: What improper or inappropriate use of the repayment facility do you think there may be, and what rules do you think should be applied by HMRC to stop that happening?
Question 7: Do you agree with a restriction on repayment shortly before a liability becomes due, and if so, what period or terms of restriction do you think should be put in place?
Question 8: Do you have any views or evidence on whether, and how, HMRC should revisit the sums paid as payments on account to match more closely to the sums being reported under MTD?
Question 9: Do you have any views or suggestions on customers’ ability to elect for overpayments to be held as voluntary credits?
Question 10: What are your views on how voluntary payments might work for partnerships? Do you think partners will see the convenience of direct payment towards their total liabilities as outweighing a loss of a limited amount of confidentiality?
Question 11: Do you think there are any special considerations that should apply to third party voluntary payments?
Question 12: What additional processes or measures would make customers feel more confident about making voluntary payments?
Question 13: Do you have any suggestions for the basis on which earlier repayments could be reasonably claimed?
Question 14: Please tell us if you think there are any other costs or benefits not covered in the summary of impacts, including any detail you may have.

What do you think?

We will be responding to HMRC’s consultation and making representations on our clients behalf so please let us have your views by emailing MTD@goodmanjones.com.

Other areas covered by the consultation

This is only one part of the consultation. See summaries of the other areas here.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

Comment on this...

HMRC is also consulting on reducing the burden for taxpayers using GAAP accounting.

Making Tax Digital: Simplifying Tax for Unincorporated Businesses Consultation

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 29th September 2016

Categories:

MTD

This consultation covers HMRC’s proposals to simplify accounting and reporting for unincorporated businesses. The proposals come under four main headings.

Increasing the entry threshold for the cash basis
Reforming basis periods
Simplifying reporting requirements
Reforming the capital/revenue divide within the cash basis

Increasing the entry threshold for the cash basis

The cash basis of reporting was introduced in April 2013 and is currently used by over a million small businesses. Under the cash basis, businesses are only required to keep records of their income and expenditure rather than producing accounts under the accruals basis. The current turnover threshold for the cash basis is aligned with VAT threshold currently £83,000. A higher threshold applies for self-employed universal credit claimants where the entry threshold is for turnover up to twice the VAT threshold, currently £166,000.

Once a business’s turnover exceeds double the VAT threshold in any tax year they must cease using the cash basis.

Under the cash basis, in addition to preparing accounts based on income received and expenses paid, certain capital expenditure such as plant and machinery used for the business can be taken into account in calculating the taxable business profits using cash basis.

All unincorporated businesses (cash basis or otherwise) also have the option to use a flat rate to calculate certain expenses including motor expenses, use of home for business and private use of business premises. (The simplified expense rules are not considered by the consultation).

The consultation asks for opinions on what would be the appropriate entry and exit thresholds for the cash basis. HMRC avoids suggesting any particular increase but does refer to the potential to double the entry and exit thresholds.

The proposal is for the cash basis to remain optional and enable businesses to move to accruals accounting when this becomes more appropriate. However, the consultation also points out the existing legislation which states that an election to use the cash basis can only cease to have an effect where there is an actual change in circumstances which makes it more appropriate for its profits to be assessed in accordance with generally accepted accounting practice (UK GAAP).

Finally, the proposal states that the entry and exit thresholds for universal credit claimants would continue to be set at twice the standard entry threshold.

Reforming basis periods

HMRC acknowledge that the current basis period rules are complex, particularly in connection with commencement provisions, change of accounting dates and cessation. A policy aim is to simplify the rules around the basis period with a view to eliminating the overlap period. The proposal is to introduce accounting periods similar to those used for corporation tax. These define an accounting period as:-

a) Beginning when the company starts to carry on a business or immediately after the end of the previous accounting period, and
b) Ending on the earliest of 12 months from the beginning of the accounting period, an accounting date of the company or the date the company ceases to trade.

The self-employed would be able to choose short accounting periods and would not be required to complete accounts for a full 12 months. The taxable profits for any given tax year would be reached by aggregating the taxable profits for all accounting periods ending in that year.

It is hoped that by introducing this change of rules there would be no need to have any further rules to deal with changes of accounting date and that the choice of accounting period would be a matter of convenience for the particular business.

Unlike for corporation tax where tax returns are aligned with accounting periods, for income tax it would still be necessary to account for tax on a tax year basis in order to interact with other sources of income. Under the consultation we are invited to raise any specific concerns regarding the interaction with other income sources.

Finally, it is recognised that many businesses have existing accumulated overlap profits. Relief for these profits will continue to be available on cessation of the business; however no comment is made on utilising overlap relief in the event of a change of accounting date. In view of this it seems likely that all businesses should review their overlap position before the implementation of these new rules which is planned for April 2018.

Simplifying reporting requirements

Currently non-incorporated businesses can account for their profits on a cash basis or in accordance with GAAP. In addition to extending the entry level for the cash basis, HMRC is also consulting on reducing the burden for taxpayers using GAAP accounting. The proposals highlight the following areas where accounting year-end adjustments are required under GAAP, but which may be dispensed with for tax purposes:

a) Adjustments to closing stock
b) Adjustments for profits where contracts span the period end
c) Adjustments in respect of provisions for bad debts
d) Adjustments for prepayments and accruals.

a) Closing Stock

The proposal is simply to remove the requirement to value stock at the period end.

b) Work in Progress

The proposal is to remove the requirement to include work in progress in the accounts but with an exception of long term contracts, long term for this purpose being defined as one year.

c) Provision for Bad Debt

The proposal is to remove the requirement to provide for bad debt.

d) Accruals and Prepayments

The proposal is to remove the need to adjust for accruals and prepayments except where adjustments would have an impact of more than one year, i.e. income not recognised within more than a year of being earned, or expenses not being recognised more than a year in advance of being due.

Reforming the capital/revenue divide within the cash basis

This proposal is restricted to users of the cash basis. The proposal is that the current general disallowance of capital expenditure would be replaced by more limited disallowance for certain types of capital expenditure. The capital expenditure to be specifically disallowed would be in relation to assets which are not used in the business over a limited period.

Specifically the following types of asset would continue to be disallowed:

a) Real property and newly constructed buildings or structures
b) Intangible assets other than any with a definite fixed life of 20 years or less
c) Another business including goodwill
d) Financial instruments and equivalent assets
e) Any other asset which does not have a limited expected useful life or cannot reasonably be expected to decline in value over the time it is used

In addition to the above exclusions, capital expenditure on cars would remain a special case and outside the scope of the proposed adjustments.

Summary of Consultation Questions

Reforming the cash basis

1a: What level do you consider to be an appropriate turnover entry threshold for the cash basis?
1b: For a threshold not linked to the VAT threshold, should it be reviewed annually in the light of inflation or less frequently (please state recommended interval)?
2a: If the entry threshold were to be increased, do you agree that the exit threshold should continue to be set at twice the entry threshold?
2b: If the entry threshold were to be increased, do you agree that the UC exit threshold should continue to be set at twice the entry threshold?

Reforming basis periods

3: Do you agree with the proposed approach of following accounting periods? If not, what alternative approach would you support?
4a: Are there any other events or situations which would require additional rules?
4b: Would it be helpful to make any changes to tax accounting periods for any other types of income?

Simplified reporting

5: Are there other end of year adjustments not listed above which could be simplified within a reduced reporting framework?
6: Would you welcome the four relaxations proposed?
7: Do you think that the restrictions proposed are appropriate? If not, what restrictions would you suggest?

Reforming the capital/revenue divide within cash basis

8: Do you believe that simplifying the capital/revenue distinction as suggested in paragraphs above would simplify reporting for businesses within the cash basis?
9: Can you identify any specific caveats which might be needed to ensure that the new rule operates as intended? Are there any potential tax planning opportunities which the current rules would not prevent?

Assessment of impacts

10a: If the cash basis entry threshold is raised would you consider using the cash basis, or advising your clients or members to use it? If so please provide details of anticipated impacts, including both one-off and ongoing benefits and costs.
10b: If the proposed basis period reform is taken forward, how do you think this would impact on business admin burdens? If possible, please provide details of anticipated impacts, including both one-off and ongoing benefits and costs.
10c: If the reduced reporting framework is introduced, please provide details of how this will affect your business, clients or members, including details of both the expected one-off and ongoing benefits and costs for:
– Familiarisation with the new scheme and updating software or systems
– Having to make fewer adjustments than would be required under UK GAAP
10d: If the revenue/capital divide is simplified as suggested do you believe that this would simplify reporting for businesses within the cash basis? If so please provide details of anticipated impacts, including both one-off and ongoing benefits and costs.
10e: Please tell us if you think there are any other impacts, benefits or costs not covered above.

What do you think?

We will be responding to HMRC’s consultation and making representations on our clients behalf so please let us have your views by emailing MTD@goodmanjones.com.

Other areas covered by the consultation

This is only one part of the consultation. See summaries of the other areas here.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

Comment on this...

HMRC are proposing introducing special procedures for partnerships, jointly owned property and sub-contractors in the construction industry whereby one person is made responsible for providing information which will then automatically be added to the individual partner’s/joint property owner’s/ sub-contractors digital account.

Making Tax Digital: Bringing business tax into the digital age

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 29th September 2016

Categories:

HMRC want businesses (including property rental businesses) to submit accounting records quarterly with a post year-end submission which reconciles to the annual accounts.

The Current Position

At present HMRC receive accounting information annually through the tax compliance process. This is either through the partnership tax return, an individual’s tax return or attached to a corporation tax return. HMRC do not have a feel for levels of income and expenses, and therefore tax receipts until these are submitted.

The tax return filing window for the unincorporated business opens on 6 April and closes on 31 January. A considerable percentage of filings are made in the last two months of the window and therefore it is not until nine or ten months after the end of the tax year do HMRC gain a reasonable view on profitability and therefore the quantum of income tax receipts that they can expect.

Although the largest corporate taxpayer pays tax on account during their year, the vast majority of companies pay tax nine months after the end of their accounting period. The tax return filing deadline for all companies is 12 months after the end of their year ends. As with income tax this makes it difficult for HMRC to project tax receipts.

Proposals

HMRC believe that the vast majority of taxpayers already have digital interactions with HMRC. All companies are required to interact digitally and the consultation document estimates that 92% of unincorporated businesses use the internet and digital tools. HMRC therefore believe that all sole traders, partners in partnership, landlords whose annual income is in excess of £10,000 and companies should therefore be subject to the requirement for digital interactions.

Quarterly reporting

The proposal is that these parties produce quarterly reports which provide accounting information to HMRC. Within nine months of the end of the accounting period a final report is submitted which adjusts the previous reports to reflect year end matters, such as accruals. From HMRC’s perspective this allows for a better understanding of UK profit flows and therefore a better understanding of tax receipts.

The consultation is at pains to highlight that quarterly reporting will be for the benefit of taxpayers. It states that the taxpayer will “be able to view an up to date picture of their tax affairs, providing greater certainty about tax due and entitlements …. and this will …. help businesses manage their affairs effectively and to understand their tax position more easily.

Many businesses have told us they want more certainty over their tax bill and don’t want to wait until the end of the tax year, or often longer, to find out how much they have to pay”.

The proposals are that the reporting will commence from 2018 for unincorporated businesses and companies will be required to report quarterly from 2019.

Concerns

The concerns already identified are:

Businesses already employ advisers to identify potential liabilities in advance of payment dates. HMRC’s perceived benefit to taxpayers is therefore illusionary.
Unincorporated businesses do not necessarily have an obligation to interact with HMRC electronically as they can file income tax returns in paper form. Why should those businesses be forced to convert to electronic submissions?
Some taxpayers do not need advance forecasting of liabilities. If the primary benefit of quarterly reporting is for the taxpayer then those taxpayers who do not want this benefit should be able to elect out of quarterly reporting.
It is unusual for business profits to accrue even over the four quarters and therefore the belief that tax liabilities can be identified throughout the year is not correct.
There is no legal requirement for quarterly accounts to be prepared and therefore why should a business incur costs for HMRC filings?
HMRC have already confirmed that they will not be providing the necessary software for interactions. If this remains the case then how can HMRC guarantee that developers will issue free software? Who will pay for the costs of developing and maintaining software required to produce quarterly accounts or the software to make submissions?
The quarterly filing dates may not be co-terminous with the VAT filing dates. Should they be aligned?
The consultation assumes that discretionary (often year-end) matters such as bonus posts are already known in advance. This is simply not the case.
The proposals are a “big-bang” change in process. Why will HMRC not have a period of piloting the proposals with a sample group of taxpayers?
Incorporated businesses have a greater degree of interaction with HMRC than unincorporated businesses. Why are the proposals suggesting that the order of implementation is the other way round?
The consultation document suggests that the changes will reduce the tax gap and contribute £945m to the Exchequer by 2020/2021. Many believe that this is the real reason that HMRC are pressing ahead with these proposals. If this is the case then it is inaccurate for HMRC to sell this process as being for the benefit of the taxpayer. Again those taxpayers who do not wish to reap this benefit should be able to elect out of it.

Summary of Consultation Questions

Acquiring Digital Tools

Question 1: What are the challenges for businesses that currently keep their records on paper or simple spreadsheets in moving to an integrated software package for record keeping, and what further measures or support would help businesses to meet these challenges?
Question 2: What information and guidance would you find helpful in choosing the appropriate software for your business?
Question 3: What types of business should a free software product cater for? What functionality would be necessary in a free software product?
Question 4: What level of financial support might it be reasonable for the government to provide towards investing in new IT, software or training, to whom should such support be aimed, and what is the most appropriate form for delivering such support?
Question 5: What other forms of support would help to make the transition to Making Tax Digital easier?
Question 6: What facilities would make it easier and more secure for businesses to enrol for Making Tax Digital and use software regularly?

Digital record keeping

Question 7: Do you have any comments about the practicalities of keeping evidence of transactions and trading when using digital tools?
Question 8: Do you agree with the minimum transaction data fields proposed for trading businesses, including retailers? What other data fields might the record keeping software usefully include as a minimum?
Question 9: Do you have any comments about reflecting the current VAT requirements in MTD-compatible software?
Question 10: Do you have any comments on the additional data capture requirements for property income and capital gains?
Question 11: What should the minimum categorisation in the software be? Would additional sub-categories be useful?
Question 12: Do you have any comments on how businesses should reflect transactions and expenditure with non-deductible elements in the software?
Question 13: What prompts and nudges would be most useful to businesses?

Establishing taxable profit

Question 14: Do you agree that businesses should have the choice as to when to record accounting adjustments?
Question 15: Do you agree that business should have the flexibility to reflect reliefs and allowances when they choose?
Question 16: What do you consider is the most appropriate approach to reflecting the effect of the personal allowance on an individual’s taxable business profit?
Question 17: Is this the right treatment of partnerships? Are there any additional partnership issues that need to be considered?
Question 18: Is this the right treatment of individuals who receive income from property, let jointly?
Question 19: Is this the right treatment of subcontractors within the Construction Industry Scheme? Are there any other CIS issues that need to be considered?

Providing HMRC with updates

Question 20: Do you have views on how detailed the summary data in the updates should be, and whether the level of summary data should be different depending on the size of the business?
Question 21: Do you have any comments on the categorisation of summary data in the updates?
Question 22: Do you have any views on what VAT data the updates should contain? Do you have any views on the advantages or disadvantages of including VAT scheme data in the updates? If so, which schemes and which data should be included in the updates?
Question 23: What flexibility around update cycles would be useful?
Question 24: Do you agree businesses should be allowed one month to submit their update? Would any problems be caused for VAT registered businesses by standardising the time limit for updates for all taxes?
Question 25: What method of deriving a business’s start date for providing updates under Making Tax Digital would be most straightforward for businesses?
Question 26: Do you wish to make any comments about the operation of ‘in-year’ amendments to updates for the purposes of profits taxes or VAT?

‘End of Year’ Activity

Question 27: Do you agree that the process of finalising the regular updates should be separate to the regular updates?
Question 28: Do you agree that businesses should have nine months to complete any End of Year activity?

Exemptions

Question 29: What criteria should be applied in determining whether to exempt a particular business or business type from the requirements of MTD?
Question 30: Should charities be exempt from the requirements to maintain digital records and to update HMRC at least quarterly?
Question 31: Should trading subsidiaries of charities be exempt from the requirement to maintain digital records and to update HMRC at least quarterly?
Question 32: Should CASCs be exempt from the requirement to maintain digital records and to update HMRC at least quarterly?
Question 33: Should businesses within the insolvency process be included within the scope of the requirement to maintain digital records and to update HMRC at least quarterly; and are any special arrangements required for this group?
Question 34: Which businesses should be included within a consistent definition of persons ‘unable to engage digitally’?
Question 35: Do you agree that £10,000 annual income is an appropriate threshold for exempting businesses from Making Tax Digital? Do you have any other comments on how the exemption should operate?
Question 36: Should the smallest unincorporated businesses that are not exempt have an extra year to prepare for Making Tax Digital? How should eligibility for this group be defined?
Question 37: Do you agree that the principles set out in Fig. 7.3 are the right ones to use in determining eligibility for an exemption? Are there any additional principles which should apply?
Question 38: Which additional groups (if any) should be exempt from the requirements to maintain digital records and to update HMRC at least quarterly?

Initial Assessment of Impacts

Question 39: Do you believe that there is the opportunity for MTD to create savings for your business? What percentage time reductions would you see from the following?
a) Targeted software tax guidance (prompts and nudges to get information right first time).
b) Gathering, collating and inputting data.
c) Reporting obligations through providing regular updates.
d) Any other potential savings not covered above.
Question 40: Do you think there are different business sectors or sizes likely to benefit more from MTD? If so, what would these be?
Question 41: What costs might you expect your business to incur in moving to the new regime? Please provide details of the costs for:
a) Time spent in your business familiarising with the new processes and conversion to these new processes.
b) Software expenditure costs (new or upgrading software).
c) Hardware expenditure costs (purchase of a computer, tablet device, etc).
d) Any other costs which are not covered above.
Question 42: Do you expect that your business will incur additional on-going costs as a result of these changes? Please provide the details of the additional costs or time for:
a) Additional support from your accountant or tax agent.
b) Additional time spent gathering, collating and inputting data.
c) Additional time reporting obligations through providing regular updates and any end of year activity.
d) Any other costs or time spent not covered above.
Question 43: Will particular businesses (e.g. partnerships) experience more difficulty in adapting to the changes? If so, please provide details, including any additional one off costs or ongoing costs.
Question 44: If you are an agent, please provide details of how these changes will impact on your own business, including details of any one-off and ongoing costs or savings. How do you perceive that these changes might affect your clients?

What do you think?

We will be responding to HMRC’s consultation and making representations on our clients behalf so please let us have your views by emailing MTD@goodmanjones.com.

Other areas covered by the consultation

This is only one part of the consultation. See summaries of the other areas here.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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As ATED applies to properties worth more than £500,000 there will be many properties which fall into the ATED regulations for the first time on 1 April 2017

Pre-Planning for ATED

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 22nd September 2016

Categories:

My Blog of 31 August ran through the recent history of property taxation in the UK. It identified that ATED (the Annual Tax on Enveloped Dwellings) was introduced a number of years ago with a consequential impact for Capital Gains Tax and Stamp Duty Land Tax.

ATED is a tax charged on non-natural persons (for example companies or partnerships with at least one company member) which hold an interest in one or more UK residential dwellings. The tax is applicable to both non-natural persons incorporated in the UK and incorporated overseas. You will also appreciate that there is a difference between a charging return and a relieving return with only a charging return leading to a tax liability and therefore valuation considerations.

The ATED charge is a fixed sum depending into which band of value the property falls. The valuation date is the later of 1 April 2012 and the date that a property is first subject to ATED. When a property is newly acquired the valuation date is the acquisition date. Should a property come into existence for the first time then the determining date is the date that it is first recognised for Council Tax purposes.

The filing date for an ATED Return is 30 days from the date the property first falls into the ATED charge. There are extensions to 90 days in prescribed situations such as the creation of a new dwelling. All enveloped properties held on each 1 April need to be subject to an ATED filing. The deadline for these filings remains 30 days later, being the end of April.

When ATED was first introduced in 2013 the first charge was for properties worth more than £2m on 1 April 2012. Since 2013 ATED has applied to properties of lower value and now ATED applies to properties worth more than £500,000.

Valuations

When ATED was first introduced in April 2013 the first valuation date was 1 April 2012. This was helpful as it gave taxpayers the opportunity to obtain valuations and determine if their properties were worth more than £2m more than twelve months prior to the introduction date for ATED. Accordingly taxpayers had time to obtain valuations and plan for the impact of ATED.

The ATED regulations state that the valuation would be revised every five years and therefore properties will need to be revalued on 1 April 2017 to determine into which band they fall. As ATED applies to properties worth more than £500,000 there will be many properties which fall into the ATED regulations for the first time on 1 April 2017. Although there is no statutory requirement to appoint property valuation professionals to revalue the property, this is the safest course of action as it demonstrates a greater level of HMRC compliance than using a director’s valuation.

As there are going to be considerable numbers of properties subject to ATED from April 2017 and therefore considerable numbers of valuations to be determined we believe that there is going to be a shortage of access to valuation professionals in April 2017. In order to allow our clients the best possible access to valuation services we are in discussion with them about either having valuations undertaken between now and April (with a desktop review at 1 April 2017) or making bookings with valuers for six months hence. We have a number of surveyor clients who we can recommend with our recommendation being based on factors such as the type of property, the location of the property and any special features of the property.

In conclusion there is an understood benefit of employing a valuation professional for ATED purposes and we can foresee a shortage of these services next spring. We are presently speaking to our clients about pre-planning for this future requirement.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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recovery of the input VAT on entertainment of a customer who comes from an overseas country is permitted"

Can I recover VAT on business and staff entertaining?

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 15th September 2016

Categories:

Image of a waiter working on a dinning table arrangement for a private party dinner.

One of the consequences of Brexit has been the fall in the value of the Pound. The UK, now more competitive, is seen as good value and overseas customers are visiting our shores to conclude contracts. This could lead to an increase in UK businesses entertaining overseas customers, prompting the question: Can I recover VAT on business and staff entertaining?

Entertainment is broadly defined to include hospitality of any kind and therefore includes matters such as food and drink, accommodation, tickets to events and purchase of capital assets used for the purposes of entertaining.

The basic rule is that VAT on business entertainment is not recoverable and therefore VAT on entertainment of customers, or potential customers, is not possible. However recovery of the input VAT on entertainment of a customer who comes from an overseas country is permitted.

Overseas Customers

This relaxation applies to entertainment of overseas customers but not entertainment of potential customers from overseas. The customer should not have a business carried on in the UK. If a business entertains a client based overseas then it could recover the input VAT. However, if the customer represents an overseas company with a UK branch, they couldn’t be treated as an overseas customer.

When recovering VAT on overseas customers, additional records should be kept. You will need to show that they are an overseas customer and do not have a business in the UK. HMRC take a strict view on entertainment of overseas customers, believing that unless the entertainment is minor, necessary, and solely for business purposes, there is likely to be a private benefit provided to the recipient and the input VAT cannot be recovered. Their public notice 700/65 gives more detail.

Staff Entertainment

VAT is also recoverable for some staff entertainment. If staff entertainment is undertaken to improve morale or offer rewards for good work, then it is considered as being incurred for a business purpose and the VAT is recoverable. The input VAT associated with directors (or partners) who attend such an event is also recoverable. Should non-employees attend, input VAT cannot be recovered on their cost and it’s reasonable to apportion input VAT using headcount. Non-employees include pensioners and former employees (or former partners), job applicants or interviewees.

Recovery of VAT arising from a staff party requires staff to attend. If the attendees are solely directors of companies or partners in partnerships the input VAT cannot be recovered. This includes celebrations to improve moral or reward good work.

Subsistence

Although recovery of VAT on entertainment is subject to restriction, VAT can be recovered on subsistence. If meals are provided on a business trip which is away from the usual place of work the VAT incurred on reasonable subsistence can be recovered. This covers subsistence incurred by staff, directors and partners. VAT receipts should be obtained when recovering tax associated with subsistence.

In conclusion, the VAT regulations generally deny recovery of VAT associated with entertainment. In the few instances where recovery is possible additional records should be kept to demonstrate that the facts meet the strict criteria required to permit the VAT to be claimed back.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

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The ATED legislation was introduced in 2013 and was a major shift in the UK property tax base. Who would have believed that it would be the start of a number of changes? Further changes are expected in 2017.

A recent history of property taxation – 2016

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 31st August 2016

Categories:

CGT
Compared to today, property investment taxation before 2013 was relatively straightforward with one of the more complex discussions being convincing non-residents that they really could realise profits on investment sites without UK Capital Gains Tax. Changes were made in 2013 which proved to be the start of a wholesale reform to various aspects of property taxation.

Introduction of Annual Tax on Enveloped Dwellings (ATED)

2013 heralded the introduction of the ATED (Annual Tax on Enveloped Dwellings) legislation which applied to high value UK residential property “enveloped” in certain structures. The tax implications were an annual ATED charge, a 15% rate of Stamp Duty Land Tax and Capital Gains Tax at 28% on increases in value from April 2013. When ATED was first introduced the definition of high value was property worth more than £2m. Since then the definition has fallen to property worth more than £500,000 with subtle differences between ATED, CGT and SDLT thresholds.

There are exemptions against the ATED regulations but these exemptions need to be claimed and therefore many ATED Returns are submitted to HMRC which do not result in tax liabilities. Based on our client base we submit far greater numbers of “relief” returns than “charging” returns.

Capital Allowances

One year after the introduction of ATED there was a change in the regulations governing capital allowances. In order for the purchaser of a commercial property to claim capital allowances on the site’s fixtures and fittings the vendor must have already claimed allowances on those assets. This has led to commercial discussions about purchasers paying professionals to determine the claims which the vendor makes for pre-completion periods or reductions in purchase price to reflect the tax relief that the purchaser will not be able to claim as the vendor has not maximised their claims.

Stamp Duty Land Tax

Later in 2014 the SDLT rates for residential properties moved from a slab system to a progressive rate. This was to help avoid artificial ceilings on prices caused by purchasers not being willing to pay £1 more for a property as that £1 would result in greater SDLT. The slab system still operates for properties charged under the commercial property rules.

ATED brought certain non-residents into the Capital Gains Tax net. From April 2015 that net was widened with the introduction of Capital Gains Tax on non-residents who dispose of UK residential property. The chargeable gain only applies to value generated from April 2015. For properties owned prior to April 2015 the chargeable gain can be determined by either a time apportionment of the gain or determining the actual increase in value from April 2015. If the latter is adopted then an April 2015 valuation would be necessary to determine the post 2015 gain. A connected change was the requirement for non-residents to report the gain within 30 days of conveyance. Unless the non-resident had an existing relationship with HMRC then the Capital Gains Tax may also have to be paid within the 30 day period.

Although UK Capital Gains Tax rates fell on 6 April 2016 the reduction did not apply to gains from residential property. A further change on 6 April 2016 impacted residential landlords. Traditionally these landlords claimed a 10% wear and tear allowance against furnished rental income to reflect the cost of repair and replacement of furnishings and white goods within a property. Although this was an optional treatment it was the method widely used by landlords. From 6 April wear and tear allowance has been abolished and landlords should claim tax relief on the actual cost of replacing these assets.

New rules for purchases of second homes or buy-to-lets

April 2016 was also the month in which new rules were introduced which resulted in higher SDLT rates on purchases of second homes or residential buy to lets. For effected properties SDLT is 3% higher than the rate of SDLT which would otherwise apply, but there are exemptions for lower value properties, caravans, mobile homes and boat houses. There is a specific relief for individuals who move home and buy their new home before selling their previous home. These individuals will need to pay the higher rate of SDLT on the purchase of a second home and then recover the excess SDLT on sale of the first home. There is a time limit to sell the former home and a time limit to claim a refund.

Offshore property developers

Offshore property developers of UK sites have been able to structure their affairs so that part of the development profit is charged to UK tax. This does not allow for a level playing field between the domestic developer, who is fully charged to UK tax, and the offshore developer. Legislation was introduced on 5 July 2016 to level this playing field.

Rental income

Individuals who receive income from renting out rooms in their home could receive up to £4,250 per year without tax. From April 2016 this has been increased to receipt up to £7,500 per year. The Government accept that some people can generate small amounts of income from rentals of, for example, their homes whilst on holiday. From April 2017 there will be a new £1,000 allowance for property income with individuals not needing to declare, or pay tax, on sums less than the allowance.

Mortgage Interest

From April 2017 mortgage interest on loans to acquire buy to let properties will only be tax deductible as if the landlord is a basic rate taxpayer. This tax relief restriction is being phased in over 4 years with the full restriction applying from April 2020. The mechanism to generate the relief is a credit against tax liabilities and not a deduction from rental profits. This can result in taxpayers falling into higher rates of tax and therefore being unexpectedly subject to the restriction. As the changes only apply to those paying income tax this has led to questions about the benefit of holding these properties in a company. Such a change in structure needs to be carefully thought through as it leads to other considerations.

From 6 April 2017 it is anticipated that there will be changes to the non-domicile legislation which will bring more individuals into the UK Inheritance Tax net and could result in properties which they own through offshore structures being subject to UK Inheritance Tax for the first time ever.

The ATED legislation was introduced in 2013 and was a major shift in the UK property tax base. Who would have believed that it would be the start of a number of changes? Further changes are expected in 2017.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

Comment on this...

Corporate developers can still claim contaminated land remediation relief which can reduce tax liabilities or generate tax repayments at a rate of 16% of the claimable sum.

Land remediation tax reliefs for property developers

Graeme Blair - Partner - gblair@goodmanjones.com

Posted on 22nd August 2016

Categories:

Environmentalist in protective suit working at a pollution site. Contamination of air, water and soil. Pollution factors like factory chimneys, old tires, plastic bottles, chemicals and other waste, all represented in the photo.

Now that property finance has become more readily available, our developer clients have significantly increased their activities. Naturally this is leading to discussions about tax reliefs on contaminated or derelict land remediation expenditure.

Land remediation expenditure can be subject to an enhanced deduction of 150% of the qualifying trading costs incurred by a company. Qualifying costs are those spent on cleaning-up harmful substances in land (contaminated land remediation relief) or removal of structures to allow the land to be put to productive use (derelict land remediation relief). The conditions for derelict land remediation relief are considerably more onerous than that of contaminated land remediation relief and therefore it is the latter relief which is the more common claim.

It had been announced in Budget 2011 that the contaminated relief would be abolished by 2012. However the Government then confirmed that it would be retained as its abolition was felt to impact the regeneration of otherwise uneconomic brownfield sites.

Staff costs

Contaminated land remediation relief gives an enhanced tax deduction for the costs of staff, materials employed and sub-contractors (including connected parties) who undertake remediation activities. For these purposes staff costs represent the earnings, pension contributions and Employers NIC of directors or employees who are directly engaged in the remediation. Time apportionment is possible, subject to deminimus levels, if the individuals are only partially engaged in the remediation work. Staff should be directly engaged in the activity and therefore support services, such as the costs of administrative departments, are not eligible for the relief.

No relief is available if it was the activities of the claimant (or person connected with them) which resulted in the initial contamination. Nor is a claim possible if there is a grant or subsidy offered to the claimant to do the work.

Timing

A company can only claim contaminated relief in the period in which the expenditure is deducted in calculating profits. This means that the deduction is only available in the period in which work-in-progress/stock is charged against profit. The HMRC manuals reiterate this point with an example confirming that relief is not available in an accounting period in which expenditure is charged to the balance sheet. Once that balance sheet sum is deductible against income the claim can be made.

The relief generates an enhanced tax deduction which can result in a tax loss. Tax losses can be used in the normal way or, if requested by the company, generate a repayment from HMRC equal to 16% of the qualifying loss.

Making a claim

However the relief is used, the enhanced tax deduction can only be recognised if a claim is made to HMRC. Most claims can be made up to two years from the period of the relevant accounts and therefore repayment interest can also accrue on sums paid by HMRC. HMRC are not obliged to make a repayment if there is PAYE/National Insurance owed to them or an enquiry into the company’s corporation tax return for the accounting period that is still open. However they can make a provisional payment of such amount as they feel fit.

In summary there are two enhanced deductions which a corporate developer can claim with contaminated land remediation relief being the common claim. This can reduce tax liabilities or generate tax repayments at a rate of 16% of the claimable sum.

Although it had been suggested that the relief would be abolished in 2012 this decision was reversed and claims are still possible.

The information in this article was correct at the date it was first published.

However it is of a generic nature and cannot constitute advice. Specific advice should be sought before any action taken.

If you would like to discuss how this applies to you, we would be delighted to talk to you. Please make contact with the author on the details shown below.

Comment on this...