Other news in brief
Other news in brief
A round up of other news this week.
On 20 December 2019 HMRC published an updated version of their guidance ‘Crypto assets for individuals’ to include a new section on the situs of exchange tokens for inheritance tax (IHT) and capital gains tax (CGT) purposes. It is important to note that the updated guidance only considers the situs of exchange tokens. While the guidance may provide a starting point when considering the situs of other types of crypto assets, for example, security and utility tokens, their tax treatment may differ. HMRC assert their view that the situs of exchange tokens will depend on the residence status of the beneficial owner so that if they are UK resident for tax purposes, any holding of exchange tokens will be subject to IHT and capital disposals will be subject to CGT. The new section of HMRC’s guidance is expressly aimed at non-UK domiciled individuals who are holding crypto assets and may be considering the remittance basis and the potential impact of IHT. It should be noted that in some circumstances crypto can be a trading asset (rather than held as an investment) and as such profits arising would be subject to Income Tax.
The UK has signed up to the 5th EU Money Laundering Directive (5MLD). One potential impact of 5MLD is to expand the scope of the existing Trust Registration Service (TRS) to include not just trusts with a tax consequence, but all UK trusts. The Professional Bodies have published details of an update received from HMRC which confirms that “the amended regulations (which transpose 5MLD into UK law) will come into force on 10 January 2020 for all elements, but do not include the TRS”. There is also confirmation that the awaited more detailed HMRC technical consultation on the details of implementation will be shared in early 2020 including the comment that “TRS must contain a robust and proportionate framework, and this consultation will include additional information on the proposals for the type of express trusts that will be required to register, data collection and sharing, and penalties.”
The UK/Colombia double tax treaty, signed on 2 November 2016, entered into force on 16 December 2019. It generally takes effect in the UK from 1 or 6 April 2020 but for taxes withheld at source it took effect from 1 January 2020. In Colombia the treaty took effect from 1 January 2020.
The December KPMG BRC–KPMG Retail sales monitor shows that 2019 was the worst year on record for retail and the first year to show an overall decline in retail sales. At first glance retailers’ relentlessness paid off in December, with total sales up 1.9 percent. However, the later timing of Black Friday will have skewed the outcome.
Proposals to re-shape the presentation of financial statements under IFRS Standards have been issued by the International Accounting Standards Board. The proposed changes are expected to improve the usefulness of financial statements and their relevance, and have been issued in response to investors' demand for greater comparability across companies.
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