16 Apr 2022


The United Kingdom has disclosure obligations (with the acronym “DOTAS”) to provide HMRC with information on potential tax avoidance schemes at an earlier stage than would otherwise have been the case. This allows HMRC to review systems and introduce legislation (often a new “targeted anti-avoidance rule”) to counter avoidance, where appropriate. As announced in the budget and following consultations on draft laws in the summer of 2020, the government will introduce new facilities of the ATED and the SDLT rate of 15% for certain qualified housing co-operatives. This law will come into force on March 3, 2021. For SDLT, relief may be requested for land transactions where the effective date of the transaction is on or after that date. Corporation tax is the fourth largest source of government revenue (B. per income, NCI and VAT). Prior to the introduction of the tax on April 1, 1965, corporations and individuals paid the same income tax, with an additional corporate income tax. The Finance Act of 1965[55] replaced this structure for companies and associations with a single corporation tax, which borrowed its basic structure and rules from the income tax system. Since 1997, the UK Tax Law Rewrite Project[56] has modernised UK tax legislation, starting with income tax, while the legislation on the collection of corporate tax itself has been amended. As a result, income tax and corporate tax rules have diverged from each other.

The government published the gaar legislation in the 2013 Finance Act. As announced in January 2021, the government will introduce legislation in the 2021 Finance Bill that will allow companies that import steel into Northern Ireland from countries outside the EU and the UK to have access to UK protection quotas or equivalent tariff treatment in the quotas, provided that the corresponding EU tariff quota is opened. The “anti-hybrid” legislation has been in force since 1 January 2017 (see question 10.2 below). These rules have been revised to fully comply with the ATAD. As announced in the budget, the government will introduce legislation in the 2021 Finance Act that will maintain the current annual capital gains tax abatement at its current level of £12,300 for individuals, personal representatives and certain types of trusts for persons with disabilities and £6,150 for trustees of most regulations for taxation years from 2025 to 2026. This applies from 6. April 2021. The government will legislate in the 2021 Finance Act to repeal national legislation that enacts the EU Interest and Royalties Directive. This legislation currently provides for an exemption from withholding tax on intra-group interest and royalty payments between UK and EU companies.

The foreign income of British residents is taxed as British income, but to avoid double taxation, the United Kingdom has entered into agreements with many countries to allow the offsetting of British tax, which is considered to have been paid abroad. These amounts paid abroad are not necessarily as high as those actually paid. [30] UK withholding income is generally subject to taxation by the UK, regardless of the nationality and domicile of a natural person or the place of registration of a company. This means that income tax in the United Kingdom of a natural person who is neither resident nor habitual resident in the United Kingdom is limited to all taxes levied at source on income from the United Kingdom, as well as to tax on income from a professional activity carried on through a permanent establishment in the United Kingdom; and tax on rental income from real estate in the United Kingdom. Budget 2020 announced that the tax rate was £200 per tonne of plastic packaging containing less than 30% recycled plastic. Following a technical consultation, minor amendments were made to the bill to improve clarity based on stakeholder feedback. The government will introduce laws in the 2021 Finance Law to repeal the provisions of the 2019 and 2020 Finance Laws regarding the carbon tax that have not been launched. This document contains the details of each tax policy measure announced in the budget and the previously announced measures that will be included in the 2021 Finance Law. It is intended for tax professionals and others interested in changes in tax policy, particularly those who will be participating in consultations on policies and bills.

These updated powers will allow the UK Treasury to adopt secondary legislation amending the definitions of banks used in these rules following the implementation of the prudential regime for investment firms from 1 January 2022, retroactively if done before 30 June 2022. The amendments will come into force after royal approval. Appendix B lists upcoming consultations, calls for evidence and other consultation documents announced in the budget. On March 23, the government will publish a series of tax-related consultations and calls for testimony announced in an order document entitled “Tax Policy and Consultations in Spring 2021.” None of these announcements will require legislation in the 2021 Finance Law or have an impact on the government`s finances. This document will be updated for the time being to reflect other announcements. As announced in the budget, legislation will be introduced in the 2021 Finance Law to remove the annual link with the increase in the consumer price index for the next 5 financial years. As announced in the budget, the government will introduce laws in the 2021 Finance Law so that the zero rate brackets of inheritance tax remain at the existing level until April 2026. Customs duties generally apply to goods imported from outside the EU and also apply to imports from the EU since 1 January 2021. The provisions of the Taxation (Cross-Border Trade) Act 2018 replaced EU customs duty legislation and created a new customs system for the UK from the beginning of 2021. As announced in Budget 2018 and confirmed in Budget 2020, the government will be implemented from 1.

Introduce a new tax on plastic packaging in April 2022, with primary legislation introduced in the 2021 Finance Bill. The tax will encourage the use of recycled plastic instead of new plastic in packaging. Yes. Although the UK is seeking to accept a reform of international tax rules on a multilateral basis (see below), the government has enacted an Income-Based Digital Tax (“DST”) Act in the Finance Act 2020 as a transitional measure. An additional penalty of 20% will be imposed if the court decides that the recipient of a subscriber notice has continued their legal dispute against HMRC`s decision on an inappropriate basis. The act will come into force with Royal Consent. In addition, a temporary power will be introduced so that any unforeseen tax consequences arising from the passage of LIBOR and other reference rates can be dealt with in secondary legislation. As announced in Budget 2021, the government will enact secondary legislation later this year to enforce provisions in the 2020 Finance Act prohibiting users of private diesel-powered recreational craft in Northern Ireland from using red diesel to power their vehicles. The United Kingdom`s tax legislation has been amended to address various issues arising from the adoption of international accounting standards for its financial statements and, in certain circumstances, related adjustments are necessary for tax purposes.

In particular, changes have been made to maintain the current tax treatment of leases following the introduction of International Financial Reporting Standard 16 (Leasing). Printed copies are good if you want to find the text of the law as it was originally enacted. It is more difficult for publishers to keep track of subsequent changes, partial repeals, etc. (Oxford SSO holders are encouraged to use one of the subscription databases – see links in the wider box – to find the current text of UK legislation.) However, if you use their update services, Halsbury`s statutes and current statutes (from 1947) offer the best. Both can be found in the concentration camp area at level 2. As announced in the budget, the government will extend through secondary legislation the temporary exemption from income tax and Class 1 social security contributions, excluding employer-reimbursed expenses that cover the cost of the relevant home office equipment. The extended exemption is valid until 5 April 2022. 2.2 Do you have a value added tax (VAT) or similar tax? If so, at what price or at what price? Please note any rate reductions in response to COVID-19. As already announced on 12 November 2020, a technical amendment will be promulgated in the 2021 Finance Law to remedy an involuntary extension of the definition of an intermediary in the legislation on the regulation of non-tariff labour if it is a company.

The original legislation went beyond the intended scope of the directive and this amendment restores the political intent. The changes introduced in the 2021 Finance Bill will ensure that the legislation works proportionately and as intended. The “tax gap” is the difference between the amount of tax that should theoretically be levied by HMRC and what is actually levied. The tax gap for the UK in 2013-2014 was £34 billion, or 6.4% of total tax obligations. [61] It can be broken down by type of tax Secondary legislation will also be adopted to introduce a new relief scheme in Northern Ireland to ensure that users of ships with only one fuel tank on board do not have to pay a higher tax rate for their use without propulsion than they would otherwise have (those with separate fuel tanks for propulsion and non-propulsion may continue to use red diesel for non-propulsion). .

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