A round up of other news this week.
On 30 July the Government announced, businesses which have fewer than 50 employees, a turnover of less than £9 million and were classed as ‘undertakings in difficulty’ at 31 December 2019, are now eligible to apply for funding under the Coronavirus Business Interruption Loan Scheme (CBILS). Previously, businesses classed as ‘undertakings in difficulty’ (typically businesses with high levels of debt and accumulated losses), were not eligible for CBILS. This change has been made possible by a recent amendment made to the EU’s temporary State aid framework, which applies to COVID-19 related State aid.
Companies House has confirmed that it will automatically extend companies’ accounts filing deadlines by three months where these fall between 27 June 2020 and 5 April 2021 inclusive. In addition, for the same period, the 14 day deadlines for confirmation statements and event driven filings have been temporarily extended to 42 days and the deadline for filing particulars of a mortgage charge have been temporarily extended from 21 to 31 days. The deadlines will revert back to normal from 6 April 2021.
HMRC have given an update on their review of the future policy on interest rates within the tax system and will present their findings to Parliament by 30 November 2020 having been slightly delayed due to COVID-19. This project was prompted by a recommendation made by Sir Amyas Morse in his independent review into the disguised remuneration loan charge which was published in December 2019. The review will include consideration of interest rates, the underlying principles for HMRC charging and paying interest, and HMRC communications with taxpayers who are liable to interest dating back a number of years.
In preparation for the end of the Brexit transition period, the European Commission has proposed changes to the EU’s VAT Directive to introduce a special identification number for businesses in Northern Ireland, so that EU VAT provisions can be properly applied to goods, in line with the Protocol on Northern Ireland. Under the Protocol, from 1 January 2021, EU VAT legislation will continue to apply when it comes to goods traded in Northern Ireland while supplies of services in Northern Ireland will be subject to UK VAT rules. The European Commission has confirmed that similar legal changes are to be made in relation to excise duties.
From 29 July 2020, customs intermediaries have been able to apply for £50 million of new Government grant funding, first announced in June 2020. The funding is available to help with recruitment, training and supplying IT equipment to increase intermediaries’ capacity to handle customs declarations ahead of the end of the Brexit transition period on 31 December 2020. Eligible businesses must have been established in the UK for at least 12 months and must not have previously failed to meet their tax obligations.
In response to the ongoing COVID-19 pandemic, the Council of the European Union has confirmed that the effective date of new e-commerce VAT rules will be deferred by six months from 1 January 2021 to 1 July 2021.
HMRC have published a factsheet for taxpayers with information on penalties and assessments which will apply where grants have been over-claimed under the Self-employment Income Support Scheme (SEISS). This also includes information on how to notify HMRC of over-claimed SEISS grants.
The OECD's Forum on Tax Administration has published a report, entitled Tax Administration Responses to COVID-19: Assisting Wider Government. The report notes that, as a result of COVID-19, tax administrations are taking on new responsibilities and sets out some of the considerations that tax administrations may need to take into account as a consequence. The report also highlights opportunities for tax administrations to build on learnings from the current crisis to improve their future resilience and agility.
The Public Accounts Committee (PAC) has launched an inquiry on the ‘tax gap’, the difference between total tax HMRC estimate due and the amount HMRC collect. The latest estimate of the tax gap, for 2018-2019 stood at £31 billion or 4.7 percent of tax due. The PAC is accepting evidence on its inquiry until 27 August 2020 and, in September it will question senior Government officials on how effectively HMRC are tackling the tax gap.
Ahead of the US presidential election in November 2020, KPMG in the US have published an overview of Joe Biden’s US tax proposals. The overview is structured as a question and answer document and summarises what is known as at 4 August 2020.
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