Covid-19 has resulted in clients needing different advice. Some clients are struggling, while others are doing very well, so I am having varied conversations – on how to make a claim under the furlough scheme; how to retain key staff; what’s the best method of asset protection; and how to reduce corporation tax – all in the space of an hour.
The usual issues are still coming up on group reorganisations and staff share schemes, and I am about to complete my third EMI scheme during the ‘lockdown’.
I am also still busy dealing with international tax queries, mainly for businesses coming to the UK either with staff or setting up a UK operation, reviewing current structures and advising on future plans on cross-border work. DAC 6 is an issue, and I expect this to be even more of an issue going forward.
If you could make one change to a tax law or practice, what would it be?
A consistent interpretation of OECD guidance, so businesses knew where they stand doing international business. I know the OECD is trying to do this, but it does harm international trade when there is ambiguity which effects the global economy.
Are there any new rules that are causing a particular problem?
DAC 6 will soon become a live issue. It takes a lot of time and effort to go back to 2018 (as the rules require) to produce a report on the tax planning undertaken, and it’s difficult to get clients to take on board. This could go either of two ways: either we report everything, even if it is not always justified (but it protects clients and tax advisers from penalties), or little will be reported (and the client could be left susceptible).
Has a recent tax case has caught your eye?
HMRC v Inverclyde Property Renovation LLP and Clackmannanshire Regeneration LLP – in which HMRC lost in the First-tier Tribunal and won in the Upper Tribunal. Many years ago, when HMRC opened an enquiry into the LLP, it also sent out s 9A enquiries to the members. HMRC has since stopped this practice and relied on the deeming provisions of the partnership enquiry notice to ensure the members' position was under enquiry. Following HMRC’s defeat at the FTT, the recent Budget announced the introduction of retrospective legislation to ensure that certain LLP enquiries invalidated by the FTT decision would not benefit from that decision. I have never agreed with the use of retrospective legislation. I appreciate the Treasury’s position to protect the public purse, but it would be better to bring TMA 1970 up to date and fit for purpose. I understand the Treasury is working on this update but the sooner it completes this, the better.
What should we be looking out for later this year?
I expect to see changes to the furlough scheme this year, followed next year by HMRC enquiries into furlough claims, along with new tax measures to generate revenue.
What advice would you give to someone entering the profession?
It’s important to accept change and adapt to unforeseen circumstances. I never started out to be a tax adviser; I planned to train as a chartered accountant and then take over my parent’s business, but whilst training my parents' business went into liquidation, and my future plans disappeared. This taught me a valuable lesson which I’ve held on to throughout my career, and it’s one that’s worth remembering when providing tax advice.
And finally, you might not know this about me but...
I am still playing cricket and captain the second team at Chatburn. I’m very much enjoying the game, even though I cannot see the ball as well as I used to!
Covid-19 has resulted in clients needing different advice. Some clients are struggling, while others are doing very well, so I am having varied conversations – on how to make a claim under the furlough scheme; how to retain key staff; what’s the best method of asset protection; and how to reduce corporation tax – all in the space of an hour.
The usual issues are still coming up on group reorganisations and staff share schemes, and I am about to complete my third EMI scheme during the ‘lockdown’.
I am also still busy dealing with international tax queries, mainly for businesses coming to the UK either with staff or setting up a UK operation, reviewing current structures and advising on future plans on cross-border work. DAC 6 is an issue, and I expect this to be even more of an issue going forward.
If you could make one change to a tax law or practice, what would it be?
A consistent interpretation of OECD guidance, so businesses knew where they stand doing international business. I know the OECD is trying to do this, but it does harm international trade when there is ambiguity which effects the global economy.
Are there any new rules that are causing a particular problem?
DAC 6 will soon become a live issue. It takes a lot of time and effort to go back to 2018 (as the rules require) to produce a report on the tax planning undertaken, and it’s difficult to get clients to take on board. This could go either of two ways: either we report everything, even if it is not always justified (but it protects clients and tax advisers from penalties), or little will be reported (and the client could be left susceptible).
Has a recent tax case has caught your eye?
HMRC v Inverclyde Property Renovation LLP and Clackmannanshire Regeneration LLP – in which HMRC lost in the First-tier Tribunal and won in the Upper Tribunal. Many years ago, when HMRC opened an enquiry into the LLP, it also sent out s 9A enquiries to the members. HMRC has since stopped this practice and relied on the deeming provisions of the partnership enquiry notice to ensure the members' position was under enquiry. Following HMRC’s defeat at the FTT, the recent Budget announced the introduction of retrospective legislation to ensure that certain LLP enquiries invalidated by the FTT decision would not benefit from that decision. I have never agreed with the use of retrospective legislation. I appreciate the Treasury’s position to protect the public purse, but it would be better to bring TMA 1970 up to date and fit for purpose. I understand the Treasury is working on this update but the sooner it completes this, the better.
What should we be looking out for later this year?
I expect to see changes to the furlough scheme this year, followed next year by HMRC enquiries into furlough claims, along with new tax measures to generate revenue.
What advice would you give to someone entering the profession?
It’s important to accept change and adapt to unforeseen circumstances. I never started out to be a tax adviser; I planned to train as a chartered accountant and then take over my parent’s business, but whilst training my parents' business went into liquidation, and my future plans disappeared. This taught me a valuable lesson which I’ve held on to throughout my career, and it’s one that’s worth remembering when providing tax advice.
And finally, you might not know this about me but...
I am still playing cricket and captain the second team at Chatburn. I’m very much enjoying the game, even though I cannot see the ball as well as I used to!
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