Corporate Interest Restriction – new rules apply from April 2017 with the aim of restricting tax relief for interest expense, however, they can also apply to a reduction in value of loan relationship assets. We can help you manage your approach to this regime and advise which of the numerous elections should be made. It may also be necessary or advantageous to appoint a reporting company and file an Interest Restriction Return.
Corporation tax losses – significant changes to the way in which tax losses are relieved also came into effect from April 2017. On the plus side, new losses arising after March 2017 can be used more flexibly than previously, including a new ability to group relieve carried forward losses. However, there is also a downside, which is that offset of any unused losses from prior years may now be restricted, leaving some current year profits in charge to tax.
Making Tax Digital for Business – HMRC’s drive to digitise the tax system started with VAT. VAT registered businesses are required to keep records digitally and use software that can transmit VAT return data to HMRC electronically. Manual keying of VAT return data is no longer permitted. A similar transformation is anticipated for corporation tax in the coming years. Have you considered the possible implications?
“Off payroll” contractors – from April 2021 the burden of the so-called “IR35” rules will shift from the personal service companies used by many contractors to the businesses which engage them, unless those businesses are “small”. Large and medium sized businesses will need to plan carefully for this change.