UK and International Tax news
Consultative Documents On Tax Policies
Saturday 31st July 2010
The Exchequer Secretary to the Treasury, David Gauke MP has recently published nine documents for discussion and consultation relating to tax, following commitments made at the June Budget. These are intended to provide businesses, tax professionals and other interested parties with a more comprehensive view and the opportunity to comment on the Governments proposed tax reforms. The documents cover:
• PAYE reform
• Furnished holiday lettings
• Pensions tax relief
• Associated company rules
• Disclosure of inheritance tax avoidance
• Foreign branch taxation
• Controlled foreign company interim improvements
• Modernisation of investment trust company rules
• National minimum wage regulations
The Government has confirmed that it is committed to being more open and transparent in its approach to policy making, by allowing relevant and interested parties to have their say, which it hopes will improve the quality of the process and allow the Government to make informed decisions based on the views of those who will be affected.
The Government has published a consultation on improving the operation of Pay As You Earn (PAYE), which seeks views on the collection of real time information to simplify taxation and reduce burdens on business. It also invites views on an option for longer-term reform to improve accuracy and further reduce administrative burdens, or alternative proposals to the same end. The Government seeks interested parties’ views on these proposals.
With regard to furnished holiday lettings, the Government has published a consultation document on a proposal to ensure that the tax rules meet EU legal requirements in a fiscally responsible way, by changing the eligibility thresholds and restricting the use of loss relief. The Government seeks interested parties’ views on the proposal set out in the document.
The Government announced in the June Budget that it was considering the issue of pensions tax relief, and has now published a discussion paper setting out the range of policy issues that would need to be decided in any new regime. The Government seeks interested parties’ views on these issues.
The Government has published a summary of responses to the recent consultation on simplifying the associated company rules as they apply to the small profits rate of corporation tax. As announced in the June Budget, proposed legislation will be introduced in the 2011 Finance Bill, to take effect from 1 April 2011.
With regard to inheritance tax avoidance schemes, the Government has published a consultation on legislation designed to bring inheritance tax, as it applies to the transfer of property into trust, into the disclosure regime, with the objective of addressing the problem of identifying such schemes and users at an early stage and seeks interested parties’ views on the detail of implementation.
The Government has issued a discussion document on the scope of an exemption for foreign branch profits, aimed at delivering a more territorial approach to corporation tax to enhance the UK’s competitiveness and seeks interested parties’ views on the likely impacts of the proposals set out in the document and on implementation of these proposals.
The Government has published a short note setting out the aim and scope of CFC interim improvements, together with the framework for consultation over the summer and seeks interested parties’ views on the nature of these improvements, including possible options to achieve the aims set out and potential other worthwhile improvements that should be considered.
The Government has also published a consultation document which sets out proposals for modernising the tax rules for investment trust companies, together with consequential amendments to the Companies Act by the Department for Business Innovation and Skills, and seeks interested parties’ views on the proposals for change.
A summary of responses to the recent consultation on travel and subsistence schemes implemented for some temporary workers paid at or near the National Minimum Wage (NMW) has been published. The Government has considered the responses and has concluded that, on balance, action should be taken. It proposes to amend the NMW Regulations to take effect from 1 January 2011.
If you would like further information on any of the above, please contact Keith Rushen on +44 (0)20 7486 2378Contact Us