For many Friday afternoon these days appears to be associated with winding down and easing into the weekend unless of course you are involved in tax! This time of the week is increasingly being used by HM Treasury for key announcements. On Friday 18 May, the consultation known as ‘Off- payroll working in the private sector’ was issued and on Friday 6 July the first draft provisions for Finance Bill 2019 extending to some 222 pages comprising 40 clauses and 16 schedules. I say first draft provisions as there will without doubt be further provisions when the whole Finance Bill is issued towards the end of the year.
The draft legislation is open for comment until 31 August 2018 with final decisions published at Autumn Budget, which is likely to be in November. As many of the draft provisions arise from the outcomes of consultations issued at Budget 2017 or in Spring 2018, an initial glance indicates no big surprises but there are one or two new areas to consider.
Key measures likely to impact on a wide client base include:
- A framework for a penalty system for Making Tax Digital which will introduce a new points-based system to replace the current system for late submission of returns. Penalties will be levied once a certain threshold of points is attained.
- A new late payment penalty system with powers to extend the scope of taxes but which will initially include IT, CGT, CT and VAT. Penalties will start to accrue on debts remaining due after 15 days from the payment due date.
- Stamp duty land tax (SDLT) filing will be reduced from the current 30 days to 14 days from 1 March 2019.
Specific measures of interest affecting individuals include:
- A NEW shared occupancy rule for ‘Rent a room’ relief. This measure is intended to make it clear that, for example, renting out the entirety of your home for say Wimbledon fortnight is not eligible for the relief.
- A new requirement to provide a return and a payment on account within 30 days for residential property gains from 6 April 2020.
- A simplification of donor benefits rules for Gift Aid.
- Changes to remove anomalies in the Optional Remuneration Arrangements rules for employer provided taxable cars and vans.
Specific measures going ahead for companies and business include:
- The extension of the scope of capital gains on non-UK resident persons to all UK immoveable property rather than just residential property as at present.
- Rules for tax compliance purposes where the new International Financial Reporting Standard on leases is adopted.
- Avoidance measures relating to profit fragmentation arrangements.
All the published clauses and explanatory notes can be accessed here:
A tax information and impact note (TIIN) has also been issued for each measure. This sets out what the legislation seeks to achieve, why the government is making the change and a summary of the expected impacts.