The deadline for employers to report events in relation to employment related shares (and other securities) and share options in respect of tax year 2022/23 is 6 July 2023. Most companies will know that if they operate an HMRC-approved or tax-advantaged share option / incentive scheme such as EMI, CSOP, SIP or SAYE, there is an annual reporting requirement in relation to events happening during...
Read moreTax Bite – Highlights of “Tax Day” – Stamp duty reform, and possible changes for EOTs? Last Thursday 27 April was “Tax Administration and Maintenance Day”, which involved the publication of various consultations and proposals on tax measures, and the promise of more consultations to come. Of most interest to those advising companies and their shareholders were: The announcement that there will be...
Read moreProperty Tax Bite – “Tax Day” – Possible reforms to the Construction Industry Scheme Last Thursday 27 April was “Tax Administration and Maintenance Day”, which involved the publication of various consultations and proposals on tax measures, and the promise of more consultations to come. Of most of interest to those advising on property tax matters was the publication of a consultation on proposed...
Read moreTax Bite - The Budget The Budget of 15 March was relatively benign in terms of major tax announcements for business but did have a few welcome highlights. There were no changes made to the headline tax rates – so corporation tax will still increase to 25% from 1 April for companies with annual profits in excess of £250k – and BADR was left untouched. Full expensing The main announcement for...
Read moreIn October, HMRC published its long-awaited (at least by advisers) guidance on the use of discretions in EMI options. There has been a long period of uncertainty, during which it was not clear in what circumstances HMRC would regard the exercise of a discretionary power in an EMI option contract as: Not affecting the tax-advantaged EMI status of the option; or A change to a fundamental term of...
Read moreTax Bite – EMI share valuations – HMRC’s latest approach In addition to the various tax advantages of EMI options, the ability to agree the market value of the option shares with HMRC is a very useful further benefit of EMI. If shares are simply issued/transferred outside of an EMI option, there is no ability to agree the share value with HMRC and shares in a private limited company are...
Read moreTax Bite - The "Mini-Budget" The "mini-Budget" of 23 September, or Growth Plan as it was badged, was less mini than most had been anticipating in terms of tax announcements. The reversal of the 1.25% increase in national insurance contributions was very much expected, and will take effect from 6 November this year. This will be joined in April 2023 by a 1% reduction in the basic rate of income...
Read moreTax Bite – Share buybacks – Update A company purchase of own shares, or buyback, is a popular way of implementing corporate succession, but is not without tax challenges and risks. Corporate lawyers will be familiar with the company law rule that a buyback cannot include deferred consideration. Most will also be aware of the basic tax rule that the proceeds of a buyback from an individual (above...
Read moreIn this Tax Bite, we look very briefly the often-overlooked loans to participators rules. These rules are something to be aware of whenever you are dealing with a close company, which in broad terms is a company that is controlled by five or fewer “participators” (i.e. shareholders and their associates). If a close company makes a loan to a participator, and the loan remains outstanding 9 months...
Read moreTax Bite - Employee Ownership Trusts The Employee Ownership Trust (“EOT”) legislation was introduced in 2014. Since the news of a possible rise in CGT rates at some point in the relatively near future, more business owners have been looking to achieve an exit and as a result EOTs are currently on a lot of people’s radars. As a headline, the CGT relief afforded to shareholders is hard to ignore –...
Read moreTax Bite – Section 431 Elections In this Tax Bite, we give you a refresher on section 431 elections, with a focus on practical points and tips for transactions. Background – what are s431 elections and what do they do? Almost all shares acquired by a director (including a non-executive director) or employee of a company will be employment-related securities for tax purposes, bringing them within...
Read moreTax Bite – Temporary extension to trading loss carry-back rules – implications for deals We noted in a previous Tax Bite that the Spring Budget on 3 March 2021 included proposals for a temporary increase in the carry-back period for trading losses in response to the impact upon businesses of the COVID-19 pandemic. In certain circumstances the carry back period has been extended to the three...
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