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TaxCalc Blog

News and events from TaxCalc

Pauline Smith (8)
29 November 2019

November news

Upcoming legislation: Ultra Low Emission Vehicles

From 6 April 2020 the car and car fuel benefit calculation is changing with the introduction of 11 new bands for ultra low emission vehicles (ULEVs) including a separate zero emissions band. This is to support the Government’s commitment to improving air quality in towns and cities. If your client’s company car has a CO2 emission figure of 1-50g/km, they will need to provide the cars zero emission mileage. This is the distance that the car can travel in miles on a single electric charge.

Read more

 

TaxCalc Top Tip:  Car Benefit Calculator­­­­­

To ensure you receive the correct benefit calculation for zero emission cars:

Within Company car wizard > Car details, select ‘yes’ to ‘Does the car have an approved CO2 emission figure’ and enter the approved emissions figure as zero

Tax: HMRC Filing Exclusions and Special Cases

As we approach the busiest filing period of the year, we thought a reminder on HMRC filing exclusions would be useful.

Exclusions are cases where HMRC’s tax calculator is unable to compute an individual’s tax liability correctly. In these situations, HMRC’s systems will either not permit the return to be filed online or will calculate the tax due incorrectly. We have been working to identify scenarios where an Exclusion has arisen and ensure that the software provides instructions on how to deal with filing.

Generally, where a return is identified as being subject to an exclusion, it can be filed on paper instead. The paper filing deadline for 2018/19 is 31 October 2019 but, provided the return is filed by 31 January 2020 and is accompanied by a reasonable excuse form explaining which exclusion case applies, HMRC should not charge a penalty.

Special Cases represent issues that HMRC have identified as requiring a workaround in order to prevent a filing rejection. Where possible, we have taken care of these workarounds within the software or have provided a message before live filing to advise how to deal with the workaround. There may be some limited scenarios where a paper return will need to be filed.

The list of exclusions and special cases are subject to change, so save our knowledgebase article for a regularly updated list.

 

Future: Evolving Compliance for Cryptoassets

The cryptoassets sector is fast-moving and developing all the time, and consequently the tax treatment continues to develop. HMRC have recently updated their advice with more detailed guidance.

In brief:

  • HMRC will apply tax provisions according to what activity has taken place which could include; buying and selling exchange tokens, exchanging tokens for other assets, ‘mining’ assets and providing goods or services in return for exchange tokens.
  • The transaction needs to be converted to pounds sterling by establishing an appropriate exchange rate, for which records of the valuation methodology should be kept.
  • A key factor in determining the tax treatment is whether a trade is being carried out in which case the receipts and expenses will form part of the trade profit calculation.
  • If the activity concerning the exchange token is not a trading activity then the activity will be a disposal subject to corporation tax or capital gains tax.
  • Transactions may be pooled for gains and losses purposes for which HMRC have provided detailed guidance.
  • VAT is due in the normal way on any goods or services sold in exchange for cryptoassets tokens but exchange tokens received by miners for their exchange token mining activity will generally be outside the scope of VAT.
  • Exchange tokens paid as earnings to an to an employee is subject to income tax and national insurance contributions.
  • Separate records for each transaction must be kept.

Detailed guidance can be found on  tax treatment of individuals and businesses with cryptoassets.

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