The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
These are our brief notes and thoughts on cases published in the last week or so which caught our eye and are likely to be of particular interest to tax practitioners. Full case reports and commentary on most of these cases will be included within our normal reference sources in the coming weeks.
This is acase about the interaction of accounting principles with the computation of tax liabilities. The dispute was essentially about what happens when revenue expenditure, which has been deferred in the balance sheet and is being amortised over anumber of years, is charged to the profit and loss account when the asset to which it relates is sold. The details are not important, but all involved in corporate tax should study this judgement because of its very careful analysis of how accounting standards should be interpreted in the context of atax dispute. The judge preferred the taxpayer’s analysis. For much of the decision, his analysis is balanced and measured but in his closing remarks, he suddenly let us rip. Finally, to conclude the above is entirely compatible with the system for calculating the taxable profits of atrade which has operated in the UK for many years. In contrast, were the submissions of [HMRC] in this appeal to succeed, that would drive acoach and horses through that system and render it incapable of functioning effectively and appropriately. Considering HMRC’s position, in this case, it is not only unsound as amatter of law but would, if adopted, give rise to an unfair result for the appellant and cause potentially significant upheaval in relation to this aspect of the UK taxation regime more generally.
Business deals are often agreed on ahandshake. This can work well, but where arelationship breaks down, the lack of awritten agreement can
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Why is this important?In order to get a full basic state pension, an individual must have paid sufficient national insurance contributions (NIC) for a minimum number of qualifying years in their working life. As NIC cannot be paid in the tax year before the individual reaches the age of 16, or in a
Why defer a gain?An individual’s net taxable income and chargeable gains for the tax year influence the rate of tax payable on their capital gains. See the Introduction to capital gains tax guidance note.Depending on the nature of the asset disposed of, this can result in the individual paying
This guidance note explains how to calculate the amount of tax that arises under the lifetime charge. In general terms the lifetime charge will apply to individuals who transfer property into a trust that is subject to the relevant property regime. See the Chargeable transfers and Occasions of
This guidance note considers the capital gains tax implications where shares are sold in exchange for new shares.The consideration paid by a purchasing company to the shareholder(s) for their shares in a target company could be in the form of either:•new shares in the purchasing company in exchange
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