The Corporate Interest Restriction (“CIR”) rules, which came into force on 1 April 2017, limit the net financing costs which a group can deduct against its UK taxable income. The rules apply to interest and amounts economically equivalent to interest, which are referred to as “tax-interest” in the legislation. Tax-interest includes the financing costs of … Continue reading Corporate Interest Restriction Rules & IFRS 16 Leases

The International Accounting Standards Board’s new international accounting standard on leases, IFRS 16 Leases (“IFRS 16”), will shortly be coming into force in respect of periods of account beginning on or after 1 January 2019. For lessees, the new standard has important implications, bringing most leases on-balance sheet, while eliminating the dichotomy between finance leases … Continue reading UK Tax Changes in Response to New Lease Accounting Standard (IFRS 16 Leases)

Today we had the Chancellor’s first Spring Statement since the decision to move the Budget to the Autumn. The Chancellor took pains to manage expectations downwards but, while there were no major tax announcements for the new financial year, there were some interesting consultations launched and updates on earlier consultations. Entrepreneurs’ Relief (ER) ER provides … Continue reading The Spring Statement: What’s new?

In the Autumn Budget, the Chancellor announced that legislation will be included in the Finance Bill 2017/18 (the “Finance Bill”) giving effect to the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the “Multilateral Instrument”). The Multilateral Instrument can be accessed here. The Multilateral Instrument implements aspects of … Continue reading Finance Bill 2017/18: the BEPS Multilateral Instrument

In addition to the changes to EIS, SEIS and VCT set out in our blog, further changes were announced in today’s Budget that will only apply to VCTs. The Government has acknowledged in its response to the “Financing growth in innovative firms” consultation that VCTs have begun to move away from investing in established companies … Continue reading VCT – high-risk, high-reward?

Clampdown on so-called capital preservation As was widely expected, the Government intends to change the EIS, SEIS and VCT rules to ensure they are focussed on high-risk, “genuine entrepreneurial” IP-intensive companies and are not used in a way that provides “capital preservation” for investors.   Whilst the good news is that no one industry has been … Continue reading A mixed bag of news for the EIS industry

By way of “marking my own homework”, I have revisited my Budget predictions post to see how many I got right.  Updates in bold type and words in colour are live links to blog posts or documents. Overall not a bad effort if I may say so myself.   • extension of corporation tax to … Continue reading Today’s Budget: Were our predictions right?

  The Government has confirmed that it will legislate in relation to the taxation treatment of partnerships. The proposed changes were originally published on 13th September and they mostly relate to administrative aspects. However, the original proposals also included changes in relation to profit allocation rules. These changes are designed to address HMRC concerns that … Continue reading Partnership taxation

HM Treasury has published a position paper in respect of taxing the digital economy (available here) following the Chancellor’s Autumn Budget. The paper proposes that multinational groups’ profits should be taxed where value is generated. For example, a social media business generates value through users worldwide, but is only taxed where it is tax resident … Continue reading Taxing the Digital Economy: first steps by the UK

There was good news today for those that feared that the Government might use the Budget to announce proposals to reverse all the tax advantages of personal service companies. The Government is merely to consult on the tax treatment of workers using service companies to provide services to the private sector. The tax savings which come … Continue reading Workers using service companies and in the gig economy – further consultations

Analysis from the award-winning CMS Tax Group