A round up of other news this week.
On 17 August 2020, applications opened for the second stage of the Self Employment Income Support Scheme (SEISS). Alongside this, HMRC published new guidance on what is meant by ‘adversely affected due to coronavirus’ for the purposes of claiming a SEISS grant including illustrative examples. The guidance also provides details of what records businesses must keep to evidence that they have been adversely affected, including business accounts showing a reduction in turnover or increased costs, and the dates that the business was required to be closed due to lockdown restrictions.
As noted in our previous edition of Tax Matters Digest, Companies House are automatically extending companies’ accounts filing deadlines by three months where these fall between 27 June 2020 and 5 April 2021 inclusive. The deadline for submissions of Senior Accounting Officer (SAO) certificates and notifications, follow the statutory accounts filing deadlines and therefore those businesses that receive a three month extension from Companies House for filing statutory accounts, will also have an additional three months to submit their SAO filings to HMRC.
As noted in our recent article, HMRC have launched a consultation on the scope of qualifying expenditure for research and development (R&D) credits. KPMG will be submitting a response to this consultation in due course and we are keen to hear views from businesses. For further information on the consultation please see our flyer.
HMRC have updated their guidance manual on the UK Digital Services Tax (DST) with details of similar foreign taxes on which cross-border relief can be claimed. Where a transaction is cross-border, this means the revenues may be linked to both a UK user and a non-UK user. In this situation, all the revenues from the transaction could be subject to DST in both the UK and in another jurisdiction. Under the UK DST rules, cross-border relief applies when transaction revenues are (or would be) subject to a similar DST imposed in a foreign country. Where a valid claim for cross-border relief has been made by a taxpayer in its group DST return, the UK digital services revenues from the qualifying cross-border transactions for an accounting period will be reduced by 50 percent. A similar 50 percent adjustment is made for those entities using the alternative charge calculation of the UK DST and making a valid cross-border relief claim. The applicable countries list of territories applying similar DSTs to the UK will be available on the HMRC website, and currently includes France, Italy, Malaysia, and Turkey.
You may not have noticed, but you are living in the world of outcome-based business models. Tim Sarson, a Value-Chain Management Partner at KPMG UK, and his colleagues Richard Murray, Valentina Telushkina, and Alice Gant, have written a short LinkedIn article on how to manage the transfer pricing challenges that these new business models throw out.
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