First Freeport tax sites designated
Eight Freeport sites were announced as part of the 2021 Spring Budget. However, no business has been able to take advantage of the tax breaks yet. Why is this, and what has now changed?
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Accounting for VAT if there is no cash payment
Your business has submitted repayment returns for the last two quarters and you are concerned that you might have underpaid output tax on some supplies where no money has changed hands. Are your concerns justified?
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Treatment of distributions under review
The government has launched a consultation on modernising the tax treatment of distributions and repayments of capital by companies. The proposals could affect the distinction between dividends taxed as income and capital payments subject to CGT. What changes are being considered?
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Tax relief on equipment you haven’t paid for (yet)
The timing of tax relief for purchases of equipment isn’t straightforward when payments are delayed or goods are purchased through hire purchase (HP) agreements. How can you use these rules to your advantage and get tax relief before you’ve paid the final invoice?
The government announced the creation of eight Freeport sites in March 2021. The initial guidance published alongside the Budget documents indicated that businesses operating within Freeport tax sites would be able to take advantage of a number of incentives:
- A 100% first-year allowance for qualifying plant and machinery, as well as an enhanced 10% allowance for expenditure on structures and buildings
- Business rates relief
- A 0% rate of employers’ NI in respect of certain qualifying employees (from April 2022); and
- Relief from stamp duty land tax on certain acquisitions of land.
So far, no business has been able to take advantage of these incentives. This is because it isn’t enough for a business to operate within a Freeport, it has to operate within a special designated tax site within the wider Freeport area. Designation has taken some time, but the first round of tax sites have now been announced. These are within the Humber, Thames and Teeside Freeports. Helpful maps are available to show exactly where they are.
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