The following Corporation Tax guidance note Produced by Tolley in association with Malcolm Greenbaum provides comprehensive and up to date tax information covering:
International Financial Reporting Standard 16 (IFRS 16) came into force for accounting periods beginning on or after 1 January 2019, replacing International Accounting Standard 17 (IAS 17). The adoption of IFRS 16 applies to all entities which apply International Financial Reporting Standards or Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101). Entities applying FRS 102 are excluded from the changes.
Prior to IFRS 16, lessees and lessors were required to make a distinction between finance and operating leases. Where the lessee had substantially all the risks and rewards incidental to the ownership of an asset, it had to recognise a finance lease asset and liability on its balance sheet. Where the lessee did not have substantially all the risks and rewards incidental to the ownership of the asset, it recognised lease payments as an expense over the lease term and was considered to have an operating lease. This treatment will continue under FRS 102. IFRS 16 removes the distinction between finance leases and operating leases for a lessee. Under IFRS 16, a lessee will recognise all leases on its balance sheet leading to a ‘right-of-use’ (ROU) asset and a lease liability (there are certain exemptions including short-term leases or those of low value ― see below). The treatment for lessors under IFRS 16 is broadly unchanged.
For tax purposes, changes in accounting standards for leases would normally be ignored as a result of the provisions in FA 2011, s 53. However, these were repealed from 1 January 2019, broadly allowing tax to follow the accounting treatment under IFRS 16 (rather than companies having to maintain two sets of books). Instead of an operating lease rental charge through the income statement which would have generally been tax deductible, there will be an interest expense charge and an ROU asset depreciation charge. Tax relief will generally be available for both of these.
While the aggregate expense under IFRS 16 throughout the lease term will
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Income and gains may be taxable in more than one country. The UK has three ways of ensuring that the individual does not bear a double burden:1)treaty tax relief may reduce or eliminate the double tax 2)if there is no treaty, the individual can claim ‘unilateral’ relief by deducting the foreign tax
From 6 April 2015, an individual can elect to transfer 10% of the personal allowance (£1,250 in 2020/21 and 2019/20) to the spouse or civil partner where neither party is a higher rate or additional rate taxpayer. The legislation calls this the ‘transferable tax allowance’ but the GOV.UK website
IntroductionUK resident individuals who are non-UK domiciled can benefit from the remittance basis of taxation. The remittance basis allows for relief from UK taxation for non-UK sources of income which are not brought in (or remitted) to the UK. A remittance is any money or other property which is,
Expenditure of a capital nature is not allowed as a deduction when calculating trading profits. Expenditure of a revenue nature is allowable, provided there is no specific statutory rule prohibiting a deduction and the expenditure also satisfies the wholly and exclusively test. See the Wholly and
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