HLAS

The Institute of Chartered Accountants in England and Wales (ICAEW) has reported that HM Revenue and Customs (HMRC) are contacting taxpayers they believe may have overclaimed Business Asset Disposal Relief (BADR). What is Business Asset Disposal Relief (BADR)? BADR, formerly known as entrepreneur’s relief, is a tax relief designed to encourage business owners to sell or dispose of their business assets by offering a reduced rate of capital gains tax. However, there is a lifetime limit on the amount of gains that can qualify for BADR. As of 2024, this limit is £1 million. Why are HMRC writing to taxpayers [...]

Following the Bank of England's decision to maintain the base rate at 5.25%, the Federation of Small Businesses (FSB) has voiced concerns about the negative effects on small business growth and investment. FSB National Chair Martin McTague commented on the decision, stating, “Yet again, the MPC has opted to stick instead of twist, a move that was widely predicted but which is no less disappointing for it. The high plateau rates we are currently stuck at are now undermining growth as small firms struggle to access affordable finance to help them expand.” McTague emphasised that although inflation is now back [...]

The Institute of Directors (IoD) has released a consultation document proposing a new voluntary code of conduct for directors. This initiative aims to help directors and business leaders enhance public trust in their business practices as a response to recent corporate scandals like the Post Office case, which have significantly eroded public confidence in business leadership. The code of conduct revolves around six fundamental principles: leading by example, integrity, transparency, accountability, fairness, and responsible business. Given that the code is voluntary and lacks enforcement mechanisms, there are concerns about its effectiveness and the level of adoption it will achieve. The [...]

The National Cyber Security Centre (NCSC) offers an online tool called 'Exercise in a Box' to help businesses assess their resilience to cyber attacks and practice their responses in a secure environment. This tool provides various exercises that you can perform at your convenience, as many times as needed. These exercises include: A ransomware attack delivered via phishing email Mobile phone theft and response Attacks originating from an unknown Wi-Fi network Insider threats leading to data breaches Compromises through third-party software Threatened leaks of sensitive data Home and remote working scenarios Managing a vulnerability disclosure Additionally, micro-exercises cover topics such [...]

When a holding company sells shares in a subsidiary, any VAT incurred on professional fees is typically unrecoverable because share sales are considered exempt supplies. Recently, a hotel group argued that the sale of a subsidiary was directly linked to financing the completion of a new hotel construction. They contended that VAT on professional fees was a general overhead of their business and should be recoverable as input tax. The Tax Tribunals initially supported this argument, prompting many other groups to file protective claims for VAT recovery based on this precedent. However, the Court of Appeal has now ruled in [...]

If you have children under 12 attending nursery, after-school clubs, playschemes, or with a childminder, or if you're considering summer camps, consider opening a tax-free childcare account. The government boosts your savings in the account by 25%, up to £2,000 per child annually (or more for disabled children). For instance, £8,000 saved is topped up to £10,000. Funds in the account are used to pay registered childcare providers approved by Ofsted. Contributions aren't limited to parents; relatives like uncles, aunts, grandparents, and others can also contribute. The government has observed that many eligible families haven't yet opened accounts, so employers [...]

As noted in the calendar of key tax deadlines, form P11D must be submitted online by 6 July to report benefits provided to employees and directors. Common benefits include company cars, private healthcare, and loans at less than the HMRC official rate of interest of 2.25%. For company cars, it's important to note that an additional taxable benefit may apply if private fuel is provided. However, this additional tax is waived if the private fuel for the tax year 2023/24 is fully reimbursed by the employee before 6 July 2024. It's also worth mentioning that no taxable benefit or entry [...]

The Institute for Fiscal Studies (IFS) estimates that implementing VAT on private schools could generate annual revenues of £1.6 billion, according to Labour, who propose using these funds to support an additional 6,500 teachers. Many parents have inquired about strategies to mitigate the potential 20% increase in private school fees. However, the actual cost increase for parents may not equate to a full 20% due to schools reclaiming input tax on overheads and property maintenance. This could offset a lower cost base against slightly higher term fees. One potential approach involves pre-paying term fees in advance, often covering multiple years [...]

Both the Conservative and Labour parties have committed not to increase income tax, national insurance, or VAT. However, Labour plans to introduce VAT on private school fees as part of their taxation strategy. Both parties also emphasize cracking down on tax avoidance and evasion to fund their respective spending plans. Additionally, they anticipate increased tax revenues by removing the remittance basis for non-Doms, although Labour intends to refine the Conservative approach to close existing loopholes. One unique tax proposal from the Conservatives is to align the personal allowance for pensioners with the State Pension triple lock, ensuring that no State [...]

Meta, the company behind Facebook and Instagram, had plans to use user data from these platforms to train generative AI. The Information Commissioner’s Office (ICO) shared concerns from UK users with Meta. In response, Meta has decided to pause and review their plans. The ICO stated: “In order to get the most out of generative AI and the opportunities it brings, it is crucial that the public can trust that their privacy rights will be respected from the outset.” The ICO confirmed that they will continue to monitor major generative AI developers to ensure they have appropriate safeguards in place [...]