HMRC nudge letters
HMRC continues to fight the good fight in its quest to cut down on tax avoidance and have recently been issuing further “nudge” letters to taxpayers who may have an income source or assets producing gains overseas and consequently an undisclosed outstanding UK tax liability. The letter reminds the taxpayer that HMRC have visibility on overseas income or gains via their network of global information exchange and the onus is on the taxpayer to regularise their tax affairs. Unforced disclosure will result in reduced penalties for non-compliance.
Batches of these letters are being sent out weekly by HMRC and ultimately thousands are expected to be issued. Some letters are accompanied by a certificate whereby the taxpayer can state that his tax position is up to date and all in order or that he needs to make a disclosure. Taxpayers need to ensure that they fully understand the statement they are making and the repercussions of making an inaccurate or incomplete statement before they return the form.
Changes have been made to the original wording of the letter but it still directs those who need to make a disclosure to the Worldwide Disclosure Facility which may not be appropriate in all cases, particularly as it does not offer protection or assurances against criminal investigation.
The new powers tackling promoters of avoidance schemes
Under new proposals in draft Finance Bill 2021, HMRC will have wider information powers and be able to impose tougher sanctions on those who continue to promote or enable tax avoidance schemes. Whilst a robust approach to tackle unacceptable behaviour by a minority of promoters is entirely welcome, the new rules would arguably impose unnecessary administrative burdens on those operating within the law.
Draft Finance Bill 2020–21—promoters and enablers of tax avoidance schemes
Helen McGhee, senior associate at Joseph Hage Aaronson LLP, shares her insights on the Draft Finance Bill 2020–21 and its impact on promoters and enablers of tax avoidance schemes.
Apple and Ireland Win €13bn State Aid Appeal
The General Court of the European Union has today annulled the Commission’s decision regarding two Irish tax rulings in favour of Apple. The Commission had considered that the two rulings constituted State Aid, granting Apple €13bn in unlawful tax advantages.
The Price of Property
Helen McGhee looks at the present state of UK tax rules that must be considered when owning and disposing of UK property.
Inheritance tax problems in Finance Bill 2020
The rules on excluded property trusts are due to change with effect from royal assent. These changes are complex, and the new rules can have an unexpected and retroactive effect. Emma Chamberlain explores these rules to determine whether it may be necessary to exclude the settlor going forward as a beneficiary.