The UK corporate tax system places disproportionate burdens upon medium-sized businesses (those with a turnover between £10m and £500m), hampering their growth, argue the CBI and Grant Thornton in a new report. The report calls for changes to the tax rules on research & development, transfer pricing and corporation tax self-assessment, which are currently geared too much towards large companies.
Film co-production with China
The Films Co-Production Agreements (Amendment) Order, SI 2014/1561, comes into effect on 1 July 2014. It adds China to the list of co-production agreements between the UK and other countries under which films may qualify as British films for the purposes of the Films Act 1985 and, in turn, for UK film tax relief (amending SI 1985/960). The agreement with China was entered into in April 2014.
Prompt payment discounts
HMRC is consulting on implementation issues arising from changes to the legislation relating to prompt payment discounts which will take effect in relation to supplies made on or after 1 April 2015. Currently, businesses can issue invoices that give details of the amount of the prompt payment discount and its terms and show the VAT due calculated on the discounted price. If the discount is not taken up HMRC has not required businesses to alter the amount of VAT invoiced and accounted for. After the change, businesses must account for VAT on the consideration they actually receive. The consultation focuses on the consequent accounting adjustments. It started on 17 June and will end on 9 September.
MOSS guidelines
The European Commission has issued guidelines aimed at national tax authorities on how best to contact businesses as part of an audit; and businesses on methods for providing the information required by an audit. These guidelines complement the main ‘mini one-stop shop’ (MOSS) guidance issued in October 2013.
Parent-Subsidiary Directive
The Economic and Financial Affairs Council has agreed to an amendment to the Parent-Subsidiary Directive in order to prevent the double non-taxation of corporate groups resulting from hybrid loan arrangements.
The parent-subsidiary directive requires member states to exempt from taxation profits received by parent companies from their subsidiaries in other member states. This currently applies even if profit distribution is treated as a tax-deductible payment in the country where the paying subsidiary is based.
As a result of the amendment, the member state of the parent company will now refrain from taxing profits from the subsidiary only to the extent that such profits are not tax deductible for the subsidiary. Member states have until 31 December 2015 to transpose the amendment into national law.
Commissioner Semeta said: ‘With these revisions, the Parent-Subsidiary Directive will remain an important tool in creating a business-friendly environment in the EU, without giving unintended opportunities to tax evaders.’
HMRC guidance
New HMRC guidance is available from HMRC’s website, including:
an overview guide on creative industry tax reliefs;
updated guidance on IR35 (intermediaries legislation) replacing the IR35 FAQs;
new form R38 (Expat) for use by foreign nationals assigned to the UK, who have paid too much tax and want to claim a refund, or authorise a representative to receive the payment on their behalf;
PAYE for employers: at a glance: late filing penalties and appeals helpsheet;
Employer bulletin issue 48;
VAT information sheet 6/2014: The UK has received confirmation that the Serbian tax administration will refund VAT to any legitimate claims submitted by UK businesses in respect of VAT incurred in the Republic of Serbia since the 1 January 2013. The deadline for the submission of claims relating to 2013 is the 30 June 2014. The information sheet includes a claim form;
Notice CCL1: A general guide to the main rates of climate change levy and CCL notices 1/1, 1/2, 1/3, 1/4, 1/5 and 1/6 cancel and replace their respective previous versions;
Compensatory interest rates for inward processing relief & temporary admission;
Notice 232 on customs warehousing; and
Customs information papers (14) 44 and (14) 46 on changes to the ATA Carnet Unit and claims for repayment of secured duty on critical quota, respectively.
The UK corporate tax system places disproportionate burdens upon medium-sized businesses (those with a turnover between £10m and £500m), hampering their growth, argue the CBI and Grant Thornton in a new report. The report calls for changes to the tax rules on research & development, transfer pricing and corporation tax self-assessment, which are currently geared too much towards large companies.
Film co-production with China
The Films Co-Production Agreements (Amendment) Order, SI 2014/1561, comes into effect on 1 July 2014. It adds China to the list of co-production agreements between the UK and other countries under which films may qualify as British films for the purposes of the Films Act 1985 and, in turn, for UK film tax relief (amending SI 1985/960). The agreement with China was entered into in April 2014.
Prompt payment discounts
HMRC is consulting on implementation issues arising from changes to the legislation relating to prompt payment discounts which will take effect in relation to supplies made on or after 1 April 2015. Currently, businesses can issue invoices that give details of the amount of the prompt payment discount and its terms and show the VAT due calculated on the discounted price. If the discount is not taken up HMRC has not required businesses to alter the amount of VAT invoiced and accounted for. After the change, businesses must account for VAT on the consideration they actually receive. The consultation focuses on the consequent accounting adjustments. It started on 17 June and will end on 9 September.
MOSS guidelines
The European Commission has issued guidelines aimed at national tax authorities on how best to contact businesses as part of an audit; and businesses on methods for providing the information required by an audit. These guidelines complement the main ‘mini one-stop shop’ (MOSS) guidance issued in October 2013.
Parent-Subsidiary Directive
The Economic and Financial Affairs Council has agreed to an amendment to the Parent-Subsidiary Directive in order to prevent the double non-taxation of corporate groups resulting from hybrid loan arrangements.
The parent-subsidiary directive requires member states to exempt from taxation profits received by parent companies from their subsidiaries in other member states. This currently applies even if profit distribution is treated as a tax-deductible payment in the country where the paying subsidiary is based.
As a result of the amendment, the member state of the parent company will now refrain from taxing profits from the subsidiary only to the extent that such profits are not tax deductible for the subsidiary. Member states have until 31 December 2015 to transpose the amendment into national law.
Commissioner Semeta said: ‘With these revisions, the Parent-Subsidiary Directive will remain an important tool in creating a business-friendly environment in the EU, without giving unintended opportunities to tax evaders.’
HMRC guidance
New HMRC guidance is available from HMRC’s website, including:
an overview guide on creative industry tax reliefs;
updated guidance on IR35 (intermediaries legislation) replacing the IR35 FAQs;
new form R38 (Expat) for use by foreign nationals assigned to the UK, who have paid too much tax and want to claim a refund, or authorise a representative to receive the payment on their behalf;
PAYE for employers: at a glance: late filing penalties and appeals helpsheet;
Employer bulletin issue 48;
VAT information sheet 6/2014: The UK has received confirmation that the Serbian tax administration will refund VAT to any legitimate claims submitted by UK businesses in respect of VAT incurred in the Republic of Serbia since the 1 January 2013. The deadline for the submission of claims relating to 2013 is the 30 June 2014. The information sheet includes a claim form;
Notice CCL1: A general guide to the main rates of climate change levy and CCL notices 1/1, 1/2, 1/3, 1/4, 1/5 and 1/6 cancel and replace their respective previous versions;
Compensatory interest rates for inward processing relief & temporary admission;
Notice 232 on customs warehousing; and
Customs information papers (14) 44 and (14) 46 on changes to the ATA Carnet Unit and claims for repayment of secured duty on critical quota, respectively.
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