Tax News

Tax News Highlights: January 2023

In this podcast, Zoe Andrews and Tanja Velling discuss the decision in Urenco Chemplants where the Court of Appeal corrected a drafting error in the Capital Allowances Act 2001 and a range of other UK developments, including the technical consultation on the VAT treatment of fund management services, the evaluation plan for the notification of uncertain tax treatment for large businesses, the extension of the definition of “investment transaction” for the purposes of the investment management exemption to include cryptoassets, the draft guidance on upcoming changes to the R&D tax reliefs regime, the Office of Tax Simplification’s report on hybrid and distance working and the draft regulations for the new transfer pricing documentation requirement.

Tax News Highlights: December 2022

In this podcast, Zoe Andrews and Tanja Velling discuss the UK’s first comprehensive tax treaty with Brazil which was signed on 29 November 2022 as well as certain highlights from the Autumn Statement and in relation to the Autumn and Spring Finance Bills, including an update on the UK’s implementation of Pillar Two and the new Electricity Generator Levy to be legislated for in the Spring Finance Bill.

The podcast also covers two recent cases: the Court of Appeal’s decision in Centrica on the deductibility of advisory fees incurred in relation to the realisation of an investment as investment management expenses under section 1219 of the Corporation Tax Act 2009 and the Upper Tribunal’s decision in Kwik-Fit on the loan relationships unallowable purpose test in section 441 of the same Act. Zoe and Tanja further provide an update on the UK’s proposed replacement of its scaled-back DAC6 implementation and the National Audit Office Report on the Digital Services Tax.

Tax New Highlights: November 2022

In this podcast, Zoe Andrews and Tanja Velling discuss the CJEU’s decision in Fiat on fiscal State aid and the Supreme Court’s decision in NHS Lothian on historic claims for input tax recovery. They also discuss UK Finance’s report on the total tax contribution of the UK banking sector, the designation of the 2022 edition of the OECD’s Transfer Pricing Guidelines under TIOPA and the removal of the expiry date for the regulatory capital exemption from the UK’s anti-hybrid rules.

The podcast covers the OECD’s “Progress Report on the Administration and Tax Certainty Aspects of Amount A of Pillar One” and its report on “Tax Incentives and the Global Minimum Corporate Tax” as well as the Public Accounts Committee’s inquiry into the UK’s digital services tax. Zoe and Tanja also discuss the recent signature of two separate multilateral competent authority agreements on the automatic exchange of, respectively, information reported by digital platform operators on their sellers and information reported by intermediaries (or, in certain circumstances, taxpayers) in relation to arrangements intended to circumvent the Common Reporting Standard or structures that disguise the beneficial ownership of assets, in each case in the context of existing or proposed UK regulations on the topic.

Tax News Highlights: October 2022

In this podcast, Zoe Andrews and Tanja Velling discuss the First-tier Tribunal’s decision in Burlington Loan Management considering the purpose test in Article 12 (Interest) of the UK/Ireland double tax treaty and two decision of the Upper Tribunal: Aozora GMAC concerning the interaction between the UK/US double tax treaty and the UK’s rules on unilateral relief and Pickles considering the interpretation of “market value” and “new consideration” in the context of deemed distributions under section 1020 of the Corporation Tax Act 2010.  

Zoe and Tanja also discuss the decision of the Inner House of the Court of Session in Ventgrove on the interaction between VAT law and the break clause in a lease, and the Advocate General’s opinion in Gallaher on the compatibility of the UK's group transfer rules with EU fundamental freedoms.

The podcast further considers the potential impact of the Retained EU Law (Revocation and Reform) Bill in the tax context as well as announcements made as part of the Growth Plan announced by the Chancellor on 23 September 2022, including proposals to reverse the planned increase in the rate of corporation tax, abolish the health and social care levy before it takes effect, undo the 2017 and 2021 changes to the IR35 rules and make the temporary £1 million level of the annual investment allowance permanent.

Tax News Highlights: August 2022

In this podcast, Zoe Andrews and Tanja Velling discuss the Upper Tribunal’s decisions in HMRC v Euromoney Institutional Investor PLC on the application of the purpose test in the reorganisation rules (section 137(1) TCGA), in HMRC v BlackRock Holdco 5, LLC on transfer pricing and the unallowable purpose test in the loan relationship rules (section 441 CTA 09), and in Altrad Services Limited v HMRC on statutory interpretation.

They also discuss the planned OTS review of distance working, an update to the Uncertain Tax Treatments by Large Businesses Manual, confirming that the result provided by HMRC’s Check Employment Status for Tax (CEST) tool may constitute a “known position”, and the first GAAR panel opinion in favour of the taxpayer.

The podcast also highlights proposed legislative changes in three areas: two measures for which draft legislation was published on L-day - certain changes to the Qualifying Asset Holding Companies regime and the introduction of the Pillar 2 GloBE Income Inclusion Rule in the UK in the form of a new “multi-national top-up tax” - and the UK Treasury’s consultation on the codification of the sovereign immunity exemption which would narrow its application to UK source interest.

Tax News Highlights: June 22

In this podcast, Zoe Andrews and Tanja Velling discuss the General Court’s decision in the EU State aid case in respect of the finance company exemption in the UK’s CFC rules and the Supreme Court’s decision in Zipvit on input tax recovery. They discuss the recently announced Energy Profits Levy and associated investment allowance as well as the results of a survey by the Centre for Policy Studies which looked at the attractiveness of the UK as an investment location. The podcast further provides an update on Pillar One, considering in particular the extended implementation timetable and the consultations on the regulated financial services exclusion and tax certainty, and covers the OECD’s report on “Tax Co-operation for the 21st Century”.

Tax news highlights: May 2022

In this podcast, Zoe Andrews and Tanja Velling discuss the First-Tier Tribunal decisions in Sally Judges on the question whether legislative amendments and related materials can influence the interpretation of the provisions in their form before the amendment took effect, in Alexander Beard on the nature of dividends paid out of share premium, in JTI where interest deductions for the intra-group funding of a third party acquisition were denied under the loan relationships unallowable purpose rule and in Hexagon Properties which considers whether a payment of damages effected through a loan waiver is taxable under the loan relationships regime.

They also cover the Supreme Court decision in NCL that the taxpayers were entitled to a deduction as a trading expense in respect of their accounting debits recognised on the grant of share options to their respective employees by an employee benefit trust. The podcast further covers the summary of responses published by the UK government in respect of their consultation on the introduction of a UK re-domiciliation regime and the European Commission’s ongoing consultation on a “new EU system to avoid double taxation” including the potential harmonization of withholding tax refunds.

Tax news highlights: March 2022

In this podcast, Zoe Andrews and Tanja Velling consider the Chancellor’s Spring Statement which was delivered on 23 March 2022, the latest developments in the two-pillar process towards international tax reform and how the possibility of the UK’s introduction of an online sales tax sits with its international obligations.

The podcast also covers a number of recent cases: the Upper Tribunal’s decision in Royal Bank of Canada where payments received by the bank, a Canadian tax resident, were subject to UK corporation tax because they were linked to an oil field, the Court of Appeal’s decision in SKAT v Solo Capital Partners on the admissibility of the Danish tax authority’s claims in relation to withholding tax refunds alleged to have been obtained through misrepresentation, the First-tier Tribunal’s decision in Cider of Sweden on third party access to documents related to proceedings before the First-tier Tribunal, and the First-tier Tribunal’s decision in Scottish Power, as contrasted with the earlier decision in BES Commercial Electricity, on the deductibility of compensation payments following regulatory failings.