Nature of Payment An unfortunate consequence of the economic climate is that more people will find themselves out of work. At least there is an income tax exemption for statutory redundancy payments (ITEPA 2003, s 309). Non-statutory redundancy payments are charged to tax under ITEPA 2003, s 401, subject to various potential exceptions including the first… Read More »
A tax planning opportunity in the recession Tax relief for losses has obviously become a much more important issue for taxpayers since the recession started. However, as in many other areas of tax, securing loss relief is not always as straightforward as it should be. Fortunately, a recent tax case offers some assistance in some cases. Capital Gains… Read More »
How many people genuinely thought that they would see the day when business taxpayers with cash flow problems could spread or defer tax liabilities simply by picking up the telephone and having a quick chat with a friendly HMRC representative? If someone had told me a couple of years ago that an HMRC service would… Read More »
Goodwill valuation Business sales and incorporations may be on the decline in the present economic climate, but goodwill valuation is very much a ‘live’ issue. HMRCs guidance on goodwill changed in September 2008. Previously (following case law) HMRC likened the behaviour of business customers to certain types of animal (i.e. dogs, cats, rabbits and… Read More »
Good news and bad news The Budget in April included some good news and bad news for owners of furnished holiday lettings (FHLs). Property letting is not a trade for tax purposes, but owners of FHLs that meet certain conditions can enjoy a number of potential tax benefits associated with trading activities, including: entrepreneurs’ relief;… Read More »
Mark McLaughlin and Toby Harris highlight practical issues following the introduction of the Inheritance Tax transferable nil rate band How should practitioners advise? Inheritance Tax (IHT) planning for many married couples and civil partnerships was simplified by provisions introduced in Finance Act 2008 (see IHTA 1984, ss 8A–8C), which allow a claim for all or… Read More »
New Penalty Regime The new penalty regime for errors in tax returns etc is upon us in most cases, as it relates to returns covering periods that started from 1 April 2008, which are due to be filed from 1 April 2009. The expected effect of the new penalty regime is a higher level of… Read More »
On a legal footing As indicated in my article ‘Don’t Wind Me Up!’ in Taxation on 5 February 2009 (available at the Mark McLaughlin Associates website) HMRC are replacing a number of Extra Statutory Concessions (ESCs), by making them law instead. One of these is ESC C16 (‘Dissolution of companies under s 652 and s… Read More »
Qualifying Purpose It is relatively common for married couples (or civil partners) to borrow funds in joint names (assuming of course that they can still find a bank that is willing to lend them money!). Tax relief may be available for the loan interest paid if the loan is for a qualifying purpose (eg to… Read More »
Buy-to-let losses The current recession is affecting virtually everyone, including property investors. Many buy-to-let investors are finding it increasingly difficult to find tenants, and some are making significant losses. Properties owned by a property investor generally constitute a single rental income ‘business’, and there is normally little difficulty in setting off a loss from renting… Read More »