Tax News Bulletin Tuesday 8th May 2018

TAX NEWS BULLETIN

TAX NEWS

Brexit puts brakes on HMRC’s digital revolution

HMRC CEO Jon Thompson has told members of Parliament’s public accounts committee that 39 initiatives would be adversely affected by the Government’s focus on Brexit. Among the projects that will be halted or delayed are online services for tax credits for new claimants, new services for personal tax accounts, and Making Tax Digital for Individuals. Caroline Miskin, tax technical manager at ICAEW, said the delay to MTD for individuals would not affect businesses such as landlords, the self-employed and partnerships: “These groups of people will still need to file their records digitally and update their accounting records to HMRC every three months.” Andrew Hubbard, tax consultant at RSM, said experts were not surprised by the delays, describing the initial plans as “optimistic”.

The Times, Page: 61 Financial Times, Money, Page: 2

Hopes for IHT reform after review launched

Carol Lewis calls for reform of the IHT system in the Times, arguing that it is complex and unfair. The Office of Tax Simplification (OTS) launched a review of inheritance tax last week and George Bull, a senior tax partner at RSM UK, says the outcome may be “simpler administrative arrangements for low-value estates and a recommendation for a single nil-rate band on death at a level that excludes modest estates, without the complexities imposed by the residence nil-rate band and by the transferability of unused allowance.” Families paid £5.2bn in death duties in the 2017-18 tax year, the highest on record, even though only about 4% of estates are subject to inheritance tax.

The Times, Page: 63

Medical professionals lured into avoidance schemes

The Times reports on emails showing how recruitment consultants continue to offer workers on their books to be paid through “umbrella” companies that are being investigated by HMRC. The schemes take payment from employers then pay the worker back in loans that claim to circumvent tax laws. The paper says public-sector employees such as nurses and social workers are being targeted with a loan model operated by Smart Pay, which has led many to receive letters from the Revenue warning them they are using a tax avoidance scheme. Graham Webber, a director of tax at WTT Consulting, says: “HMRC has scored some very minor victories against such schemes,” but in terms of “striking them down in court, almost nothing has happened.”

The Times, Page: 67

Overseas territories question relationship with UK

Britain’s overseas territories are considering declaring independence following the vote in the UK to force the territories to make public the owners of its businesses. British Virgin Islands (BVI) premier Orlando Smith said the islands’ links with the UK were at risk, while the Cayman Islandspremier, Alden McLaughlin, said the legislation amounted to “constitutional overreach and are reminiscent of the worst injustices of a bygone era of colonial despotism.”

The Times, Page: 14

Rise in gaming duties to pay for FOBT crackdown

Whitehall sources have told the Mail that taxes on casinos will rise to pay for a cut to the maximum stake on fixed odds betting terminals (FOBTs) from £100 to £2.

Daily Mail, Page: 10

 Contact Paul Southward if you have any queries.

 Paul Southward