Weekly tax highlights ― 11 October 2021

Produced by Tolley

The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Weekly tax highlights ― 11 October 2021
  • Budget representations
  • CIOT budget representations
  • Indirect taxes
  • Revenue and Customs Brief 13 (2021): change in the VAT treatment of the construction self-supply charge
  • VAT Notices 709/1, 709/3 and 701/20: update on VAT for tourism and hospitality
  • Updated HMRC guidance: plastic packaging tax
  • International
  • Dominica: tax treaties
  • Bahamas: tax treaties
  • More...

Weekly tax highlights ― 11 October 2021

Budget representations

CIOT budget representations

The Chartered Institute of Taxation (CIOT) has published the budget representations it has made on employee ownership trusts, employment taxes and pensions regime, assignment and enforcement of loans subject to the loan charge, and remote working abroad.

The CIOT has made budget representations which include:

  1. introduction of a specific deduction for the extra cost of ‘working from home’ (WFH) for expenses incurred by an employee that are not reimbursed by the employer

  2. a review of the existing exemptions and deductions for employee’s travel expenses where an employee works from home (either full or part-time) and occasionally travels to their employer’s premises in the new era of hybrid WFH arrangements

  3. amending the trivial benefits exemption so that employer reimbursements have the same tax treatment as directly provided employer benefits (eg an employer reimbursing an employee for a flu jab should be treated as trivial rather than taxable benefit)

  4. amending the legislation to treat ex-gratia payments by employers on the death of an employee by ‘natural’ causes in the same way as an equivalent payment on the ‘accidental’ death of an employee

  5. enhancing the enterprise management incentive (EMI) eligibility criteria to help businesses recover and grow post-pandemic

  6. rectification of anomalies in the pensions tax regime for taxing lump sums from pension schemes

  7. improving pension scheme administration by fixing problems with scheme block transfers, and

  8. reviewing the money purchase annual allowance (MPAA) rules to allow individuals who have had to access their pension savings during the pandemic to recommence saving for their retirement without the contribution restrictions imposed by the MPAA

The CIOT is concerned about individuals who have entered into arrangements that are subject to the disguised remuneration loan charge and are now being asked to repay the loan by organisations (or their solicitors) who now claim to own or control their loans.

The CIOT recommends that the Government considers introducing legislation to prevent assignment and / or enforcement of

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