Option to tax changes from 1 February
From 1 February, HMRC will no longer acknowledge receipt of paper option to tax notifications. How do you ensure you receive evidence of the notification after that date?
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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?
By making an option to tax, a business can charge VAT (and therefore recover input VAT) on the sale or letting of land or non-residential property when the supply would otherwise be exempt. HMRC has issued a brief describing the changes to processing option to tax forms which take effect from 1 February 2023. From this date it will no longer issue an acknowledgement letter for the notifications it receives. This could lead to problems later on if HMRC claims not to have received your option to tax notification. However, if you submit the notification via email to optiontotaxnationalunit@hmrc.gov.uk, you will receive an automated response which will show the date the notification was submitted. Notifications sent any other way, e.g. by letter, are still valid but will not be acknowledged by HMRC. It's hoped that by scrapping the acknowledgement letters, HMRC will be more efficient in this area.
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