The following Employment Tax guidance note Produced by Tolley in association with Annette Morley provides comprehensive and up to date tax information covering:
IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marked the end of the Brexit transition / implementation period entered into following the UK’s withdrawal from the EU. At this point in time, key transitional arrangements came to an end and significant tax changes associated with Brexit began to take effect. This document contains guidance on subjects potentially impacted by these changes. Before continuing your research, see the Brexit ― personal and employment tax implications guidance note.
Practical issues for payroll operation when employees are leaving the UK are covered in the Outbound employees ― payroll issues and other legislative points in the Reporting requirements on leaving the UK guidance notes.
This section considers opportunities for UK employers to improve the tax consequences for themselves or their employees when the latter are about to depart for overseas employment.
Ensure that all agreements made between employer and employee are set out in writing in an employment contract. That should include stating the obvious, such as whether the employee is actually employed by the UK entity or the overseas entity or both.
Planning opportunities occur particularly where the same employer, or at least another group company, will continue to be the employer of the overseas individual. Nevertheless, some steps will be applicable even if the employee leaves to work for an unrelated overseas employer.
Are any bonuses due? It does not provide any reduction in tax just to delay paying an employee’s bonus or holiday pay until after he has become non-resident. He will be taxed on the basis of where he was resident at the point of his earnings, not where he was resident when he received payment (see the Taxation of cash earnings guidance note). It may be possible to delay a decision on bonuses until after the employee has moved, but care needs to be taken over directors as the trigger point for tax may still be a point before the director’s departure
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
Summary of capital allowances on carsThe current capital allowance rates applicable to cars are as follows:Pool typeDescription of carRateLegislationMain rate poolNew and unused cars with CO2 emissions over 50g/km but not more than 110g/km (to be reduced to 50g/km and below from April 2021)18%CAA
Employee benefit trusts (EBTs) are commonly used to support employees’ share schemes and to provide other benefits to employees in the form of pensions and bonuses.Their use has been significantly affected by the introduction of the disguised remuneration rules. Although the statutory exclusions
Business asset disposal relief (previously known as entrepreneurs’ relief) is a capital gains tax (CGT) relief that allows business owners with chargeable gains on qualifying business assets to pay CGT at a rate of 10%. For disposals made on or after 11 March 2020, the relief is available on up to
Preparatory workBefore completing the Inheritance Tax account for submission to HMRC, the practitioner needs to undertake a comprehensive review of the extent of the estate and its proposed distribution. The work required leading up to the submission of the account is described in detail in the
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.