Tax Administration and Maintenance Day

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On 30 November the Government held its Tax Administration and Maintenance day (TAM). They have released numerous consultation documents and calls for evidence on tax policy and procedures. Tax simplification is their primary focus and as always, we would welcome any simplification that assists our clients in managing their tax affairs. Our experts will be reviewing the consultations released and we will make representations where possible to assist in the process. The recent OTS review of Capital Gains Tax and Inheritance Tax have also been responded to, with no changes to Inheritance Tax at this point in time. With Capital Gains Tax there are some changes being considered and five recommendations have been accepted which we welcome.

Capital Gains Tax recommendations by the office of Tax Simplification which have now been accepted by the Government:

Suggestion:

Government response:

Single Customer Account

The different ways of reporting and paying Capital Gains Tax should be integrated into the Single Customer Account, making it a central hub for reporting and storing Capital Gains Tax data.

This is accepted and will be considered as part of the delivery of the single customer account by HMRC.

Reporting residential property gains

The reporting and payment deadline for the UK Property return should be extended to 60 days, or mandate estate agents or conveyancers to distribute HMRC provide information to clients about these requirement

This is accepted and was announced at the Autumn Budget and the previous deadline of 30 days has now been extended to 60 days.

Divorce/separation

The ‘no gain no loss’ window on separation should be extended to the later of: i) the end of the tax year at least two years after the separation event; or (ii) any reasonable time set for the transfer of assets in accordance with a financial agreement approved by a court or equivalent processes in Scotland

It is agreed that the ‘no gain no loss’ window on separation needs to be extended and the government will consult on the detail over the course of the next year.

Rollover Relief for compulsory purchase orders

The specific Rollover Relief rules which apply where land and buildings are acquired under Compulsory Purchase Orders (CPO) should be expanded.

The expanding of Rollover Relief to cover reinvestment in the form of enhancing land already owned meets the spirit of the initial rationale of the relief and the government accepts this and will consult on the detail in due course.

HMRC Guidance

The following specific areas of HMRC guidance needs improved:

UK Property Tax Returns
Lodgers and people working from home
Debts on securities
Irrecoverable loans to businesses
Business Asset Disposal Relief and farmers
EIS
Land assembly arrangements
Flat management companies

This is agreed. HMRC has already completed a review and expansion of the guidance on the UK Property Tax Return which will be published shortly and will proceed to the other areas of guidance listed in due course