Introduction to year-end tax planning

Produced by Tolley

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Introduction to year-end tax planning
  • Introduction
  • Commercial considerations
  • Advancing expenditure and deferring income
  • Provisions
  • Building repairs and decorating
  • Redundancy
  • Bonuses
  • Deferral of income
  • Pensions
  • More...

Introduction to year-end tax planning

Introduction

This guidance note considers various aspects of year-end tax planning for large companies or groups. It is recommended that it is read in conjunction with the Chargeable gains planning, Group companies and Year end tax planning ― international issues guidance notes so that as many relevant factors as possible are considered. See also ‘Key issues for in-house tax teams: a checklist’, by Chris Holmes, Mark Ellis, and James Egert, in Tax Journal, Issue 1511, 14 (27 November 2020).

Other matters which could be relevant, depending upon the tax profile of the company, are:

  1. whether deductions for expenditure on intangible fixed assets (IFAs) are being maximised ― see the Definition of intangibles guidance note

  2. whether deductions for loan relationships are being maximised ― refer to the What is a loan relationship? and Taxation of loan relationships guidance notes

  3. real estate investment trusts (REITs) ― for the advantages and disadvantages of this regime to companies in the property sector, see the Real estate investment trusts (REITs) guidance note

  4. review of time limits for claims and elections ― see Simon’s Taxes D1.1345

When undertaking any planning exercise, companies and their advisers should consider whether any relevant anti-avoidance provisions, Disclosure of Tax Avoidance Schemes and the General anti-avoidance rule are likely to apply. See the Disclosure of tax avoidance schemes (DOTAS) ― overview and General anti-abuse rule (UK GAAR) guidance notes respectively.

In addition to this, the UK regulations implementing the requirements of DAC 6 came into force on 1 July 2020, which require intermediaries (and in some cases taxpayers) to report information to tax authorities about cross-border arrangements which contain certain characteristics, or ‘hallmarks’. The scope of DAC 6 was significantly restricted following the end of the Brext implementation period and the only arrangements that now need to be reported are those that relate to the avoidance of obligations to report information on financial accounts, or that obscure beneficial ownership (hallmark ‘category D’). See the

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