The government is consulting until 27 February 2015 on draft Finance Bill legislation exempting deduction of income tax at source from yearly interest payable on unlisted securities known as ‘private placements’ which meet certain qualifying conditions. Conditions for the exemption will include the security being issued for a minimum period of three years. The primary legislation in FB 2015 will provide for regulations to set out more detailed conditions, including a requirement for the issuer to be a trading company. The exemption is aimed at midsize companies and infrastructure projects, thought to be the typical borrowers under this form of debt instrument.
Following consultation, the government has decided not to proceed with the proposals from the Office of Tax Simplification (OTS) for a new employee shareholding vehicle aimed at unquoted companies. This was in part because the responses did not indicate there is significant demand from those most likely to use and benefit from the employee shareholding vehicle, and advisers appeared sceptical about whether the new vehicle would significantly reduce the need for specialist tax advice or necessarily increase employee share ownership.
New IHT anti-avoidance rules bringing into charge property added to multiple trusts on the same day will apply to all relevant property trusts created on or after 10 December 2014, the government confirmed in last week’s draft Finance Bill and in response to the HMRC consultation on IHT trust charges. The rules on IHT exemption relating to appointments for the benefit of the deceased’s surviving partner will be relaxed for all deaths on or after 10 December 2014. The calculation of trust charges is being simplified by removing the need to include non-relevant property in calculations from 6 April 2015. The government has decided to not split the nil-rate band for trusts.
HMRC has published draft regulations under powers in the National Insurance Contributions Bill, which will allow payment of class 2 NIC in advance of the submission of a self-assessment return for the purposes of maternity allowance with effect from April 2015.
HMRC has published Revenue and Customs Brief 48/2014: negligible value claims and Common Agricultural Policy reform. As part of EU Common Agricultural Policy (CAP) reforms, farmers’ single payment scheme is to be replaced with a new scheme from 1 January 2015. In Northern Ireland, Scotland and Wales, HMRC regards single payment scheme payment entitlement as having become of negligible value on 16 May 2014 and will accept negligible value claims on or before 31 December 2014. In England, the single payment scheme payment entitlement continues in the new scheme and will not be of negligible value. The milk quota system is also being phased out and will cease to exist on 31 March 2015. Individual units of milk quota should be pooled and any negligible value claim made to HMRC on or before 31 March 2015. If no negligible value claim is made, the ending of payment entitlement and milk quota will give rise to an allowable capital loss.
HMRC has published a summary of responses to its consultation on implementing changes to VAT accounting for prompt payment discounts (PPD). HMRC agrees that businesses should not be required to issue credit notes when there is a reduction in consideration because a PPD is taken up. It considers that the suggested use of a single invoice setting out the terms of the PPD together with other documentary evidence to prove the price paid and the date of payment, e.g. a bank statement, is a sensible way forward. HMRC will have no objection to businesses operating in this way if they choose to do so and will issue a Revenue and Customs Brief containing guidance on this shortly.
HM Treasury is consulting until 18 February 2015 on whether to introduce a new levy on tobacco manufacturers and importers, based on market share, and whether this should be brought within the corporation tax system. The consultation explores methods by which the government would set a revenue target for the levy.
Following consultation, the government is to introduce a new class of ATED return, the ‘relief declaration return’, in draft FB 2015 in respect of properties eligible for relief. An ATED return will still be required for properties with an ATED liability. The filing deadline for the first relief declaration returns will be extended to 1 October 2015 instead of the normal filing date of 30 April 2015. Legislation in FB 2015 will also lower the company’s interest threshold to £250,000 for the aggregation rule to apply to properties valued up to £2m.
The Double Taxation Relief and International Tax Enforcement (Canada) Order, SI 2014/3274, will bring into effect the arrangements set out in a protocol and an interpretative protocol, signed on 21 July 2014, amending the UK/Canada double taxation convention. The protocols have not yet entered into force. The Double Taxation Relief and International Tax Enforcement (Tajikistan) Order, SI 2014/3275, will bring into effect the new UK/Tajikistan double taxation agreement and protocol, signed on 1 July 2014. This agreement has not yet entered into force.
The government is consulting until 27 February 2015 on draft Finance Bill legislation exempting deduction of income tax at source from yearly interest payable on unlisted securities known as ‘private placements’ which meet certain qualifying conditions. Conditions for the exemption will include the security being issued for a minimum period of three years. The primary legislation in FB 2015 will provide for regulations to set out more detailed conditions, including a requirement for the issuer to be a trading company. The exemption is aimed at midsize companies and infrastructure projects, thought to be the typical borrowers under this form of debt instrument.
Following consultation, the government has decided not to proceed with the proposals from the Office of Tax Simplification (OTS) for a new employee shareholding vehicle aimed at unquoted companies. This was in part because the responses did not indicate there is significant demand from those most likely to use and benefit from the employee shareholding vehicle, and advisers appeared sceptical about whether the new vehicle would significantly reduce the need for specialist tax advice or necessarily increase employee share ownership.
New IHT anti-avoidance rules bringing into charge property added to multiple trusts on the same day will apply to all relevant property trusts created on or after 10 December 2014, the government confirmed in last week’s draft Finance Bill and in response to the HMRC consultation on IHT trust charges. The rules on IHT exemption relating to appointments for the benefit of the deceased’s surviving partner will be relaxed for all deaths on or after 10 December 2014. The calculation of trust charges is being simplified by removing the need to include non-relevant property in calculations from 6 April 2015. The government has decided to not split the nil-rate band for trusts.
HMRC has published draft regulations under powers in the National Insurance Contributions Bill, which will allow payment of class 2 NIC in advance of the submission of a self-assessment return for the purposes of maternity allowance with effect from April 2015.
HMRC has published Revenue and Customs Brief 48/2014: negligible value claims and Common Agricultural Policy reform. As part of EU Common Agricultural Policy (CAP) reforms, farmers’ single payment scheme is to be replaced with a new scheme from 1 January 2015. In Northern Ireland, Scotland and Wales, HMRC regards single payment scheme payment entitlement as having become of negligible value on 16 May 2014 and will accept negligible value claims on or before 31 December 2014. In England, the single payment scheme payment entitlement continues in the new scheme and will not be of negligible value. The milk quota system is also being phased out and will cease to exist on 31 March 2015. Individual units of milk quota should be pooled and any negligible value claim made to HMRC on or before 31 March 2015. If no negligible value claim is made, the ending of payment entitlement and milk quota will give rise to an allowable capital loss.
HMRC has published a summary of responses to its consultation on implementing changes to VAT accounting for prompt payment discounts (PPD). HMRC agrees that businesses should not be required to issue credit notes when there is a reduction in consideration because a PPD is taken up. It considers that the suggested use of a single invoice setting out the terms of the PPD together with other documentary evidence to prove the price paid and the date of payment, e.g. a bank statement, is a sensible way forward. HMRC will have no objection to businesses operating in this way if they choose to do so and will issue a Revenue and Customs Brief containing guidance on this shortly.
HM Treasury is consulting until 18 February 2015 on whether to introduce a new levy on tobacco manufacturers and importers, based on market share, and whether this should be brought within the corporation tax system. The consultation explores methods by which the government would set a revenue target for the levy.
Following consultation, the government is to introduce a new class of ATED return, the ‘relief declaration return’, in draft FB 2015 in respect of properties eligible for relief. An ATED return will still be required for properties with an ATED liability. The filing deadline for the first relief declaration returns will be extended to 1 October 2015 instead of the normal filing date of 30 April 2015. Legislation in FB 2015 will also lower the company’s interest threshold to £250,000 for the aggregation rule to apply to properties valued up to £2m.
The Double Taxation Relief and International Tax Enforcement (Canada) Order, SI 2014/3274, will bring into effect the arrangements set out in a protocol and an interpretative protocol, signed on 21 July 2014, amending the UK/Canada double taxation convention. The protocols have not yet entered into force. The Double Taxation Relief and International Tax Enforcement (Tajikistan) Order, SI 2014/3275, will bring into effect the new UK/Tajikistan double taxation agreement and protocol, signed on 1 July 2014. This agreement has not yet entered into force.
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