Revenue has updated the Stamp Duty Manual that provides guidance on a number of exemptions and reliefs from the charge to stamp duty. Section 86A SDCA 1999 provides for an exemption from stamp duty on the transfer of stocks or marketable securities admitted to the Euronext Growth Market operated by Euronext Dublin. The guidance has been updated in paragraph 18 to reflect the fact that this exemption is an EU State Aid, granted under the general de minimis Regulation, and therefore must comply with the rules set out within that Regulation. 

Revenue has updated the Tax and Duty Manual that provides guidelines for Phased Payment Arrangements (PPAs) as follows:  The debt warehousing link has been updated to include payment options for warehoused debt repayments (paragraph 2).  Completion of the ePPA1 form is a mandatory requirement for all PPA applications. Paragraph 4 sets out changes to supporting documentation required to be uploaded with the application, depending on the value of debt is outlined.  Personal Insolvency Arrangements guidance has been updated to reflect current work practices (paragraph 14).   The letter to Personal Insolvency Practitioner, previously at appendix 5, has been removed as it is no longer in use. 

The Minister for Finance, Michael McGrath TD and the Minister for Public Expenditure and Reform, Paschal Donohoe TD, will announce Budget 2024 on Tuesday 10 October 2023. We will issue our Budget 2024 newsletter tomorrow evening covering all the main points. You can keep up-to-date with the announcements by visiting the Institute's Budget 2024 landing page.  

Last week the Institute met with HMRC’s VAT policy team to discuss in detail feedback received from our members and their clients that the 31 October 2023 deadline for selling second-hand cars bought from Great Britain and moved to Northern Ireland before 1 May 2023 should be extended. Under the current rules, such vehicles will not be able to use the VAT margin scheme if these vehicles are sold after 31 October 2023 meaning VAT must be charged on the full selling price. HMRC’s current view is that 31 October 2023 is still the deadline and dealers should make all attempts to sell these vehicles before that date. The Institute pressed HMRC to consider an extension and also said that if an extension is granted, this decision should be made and announced as soon as possible.  If your car dealer client has not yet sent in supporting evidence to demonstrate the ongoing difficulties being experienced in selling these vehicles, HMRC is still willing to accept such evidence which can be emailed to the Institute. We would recommend that this is done as soon as possible. By way of reminder, the information requested by HMRC is details or estimates in respect of the following:- The numbers of second-hand vehicles dealers in Northern Ireland had in stock on 1 May 2023 that were sourced from Great Britain;  How many of these remain unsold at present, and their estimated value;   How many are likely to be unsold on 31 October 2023, and their estimated value; and   If there is any category of vehicle that may be particularly affected by having a cut-off date of 31 October 2023 after which the margin scheme could no longer be used.   The Institute wishes to thank those members and their clients who have already provided information to support the need for an extension.   

The September Exchequer returns show tax receipts to end-September were €61.4 billion, up €3.5 billion, or over 6 percent higher, than the same period last year. Overall an Exchequer surplus of €1.1 billion was generated to end-September. This compares with a surplus of €7.9 billion for the same period last year, with the bulk of the difference generated by the transfer of €4 billion of windfall tax receipts to the National Reserve Fund earlier this year.   Corporation tax receipts were €14.4 billion to end-September, €0.6 billion, or 4.5 percent, higher than the same period last year but significantly behind profile by €0.7 billion. The underlying volatility in corporation tax is highlighted by the fact that this is the second consecutive month in which corporation tax receipts have declined on a year-on-year basis.  Reflecting a labour market that is operating at full employment, income tax receipts to end-September were €23.1 billion, up 8.2 percent on the same period in 2022 and in line with expectations. VAT receipts to end-September totalled €16.8 billion, up €1.5 billion, or 9.7 percent on the same period last year but slightly below profile.   Commenting on the figures, the Minister for Finance, Michael McGrath TD, said:  “The tax data to end-September demonstrate the need for caution as we finalise Budget 2024. The underlying strength of our economy remains evident in the steady growth in income tax and VAT receipts. However, the sharp underperformance of corporation tax is more evidence that, as I have warned many times, these receipts cannot be relied upon.  This Government has taken a number of important steps to address our exposure to corporation tax receipts, including transferring €6 billion in windfall receipts to the National Reserve Fund and committing €2¼ billion of windfall receipts to fund capital projects. In addition to this, work is at an advanced stage on proposals for a longer-term investment fund that will enable us to use some of these receipts to prepare for future fiscal pressures.  Ultimately, however, the best way to guard against exposure to windfall receipts is by pursuing a budgetary policy that strikes the correct balance between addressing the challenges of today and ensuring our public finances remain sustainable over the medium-term: it is on that basis that Budget 2024 will be framed."   

At the end of September, the UK government published additional draft legislation which contains further amendments to the UK’s Pillar 2 draft legislation. Representations on the amended draft legislation, including the additional updates (summarised below), should be made by 25 October 2023. It is also confirmed that officials are reviewing comments already received, which do not need to be resubmitted.  According to an email from HM Treasury, the amended draft legislation reflects stakeholder observations on the draft Finance Act and July 2023 L-Day publication on this draft legislation, in addition to the OECD administrative guidance released in February and July 2023. This includes amendments in respect of the following areas:-   Currency conversion rules;  Tax credits;   Substance-based Income Exclusion;   Qualified Domestic Minimum Top-up Tax (“QDMTT”); and   QDMTT and Transitional UPTR (Under Taxed Profits Rule) Safe Harbours. 

This week we bring you news about a pragmatic approach being taken by HMRC to enquiries into off-payroll working compliance and action is needed by certificate of tax deposit holders by 23 November 2023. A new interactive guidance HMRC tool is available to establish if national insurance contributions must be paid whilst working abroad and HMRC has published guidance in its International Exchange of Information manual on the new mandatory disclosure rules which took effect from 28 March 2023. Updated guidance has also been published in HMRC’s Employment Income manual on issues in relation to electric vehicles which confirms that no taxable benefit in kind arises if an employer reimburses the employee for the cost of charging a company-owned electric car. And finally, in a recent meeting of HMRC’s VAT Registration forum, which the Institute participates in, it was announced that from mid-November 2023, HMRC will no longer be providing paper VAT registration forms on GOV.UK. This will only be available on request from the VAT helpline (more information on this will be provided in due course).  Off-payroll working enquiries  We are aware that HMRC are currently taking a pragmatic approach to enquiries into the off payroll working rules by offering deemed employers the opportunity to pause any settlement, as currently this legislation does not allow for offset of any taxes already paid by the contractor or their personal service company. This is because HMRC has been consulting on legislation which may allow a limited set-off for these taxes.   However, it is not currently guaranteed that this legislation will be introduced. The ability to pause any settlement is subject to certain conditions, which are set out in a letter to deemed employers from HMRC.  Certificate of Tax Deposit holders 23 November 2023 deadline  The deadline for using Certificates of Tax Deposit is 23 November 2023. The Certificate of Tax Deposit Scheme allowed you to deposit money with HMRC and use it later to pay certain tax liabilities. The date that you bought your certificate is known as the effective date of payment.   On 22 November 2017, HM Treasury gave notice of the scheme’s closure. This means the Certificate of Tax Deposit scheme closed for new purchases from that date. HMRC will continue to honour existing certificates until 23 November 2023.  HMRC recommends holders to contact the Certificate of Tax Deposit team before the scheme closes to tell HMRC how you want to use your certificate. If you think you will still have any certificates after 23 November 2023, you should contact the team as soon as you possible to arrange a refund.  After 23 November 2023 HMRC will try to repay the balance of any certificate which remains unpaid and unclaimed. If it is unable to (for example, because HMRC is unable to contact the current certificate holder after reasonable effort), HMRC will consider the balance as forfeited.  A detailed email has been sent to us by HMRC setting out this information, which you can read here. 

At the recent meeting of Main TALC, representatives were asked to provide feedback on the commercial impact of the revised tax treatment of General Medical Services (GMS) income of General Practitioners (GPs), effective from 1 January 2024. As previously reported, GPs in a medical practice, be they principals, partners, or employees, will be required to self-assess for tax purposes on the GMS income earned in their name, with a credit for the attaching professional services withholding tax (PSWT).   From engagement with members on the issues, CCAB-I is concerned that the practical difficulties of the implementation of the revised tax treatment will cause significant complexities for partners and employees, increasing the administrative burden on GPs and potentially leading to some GPs either deferring taking up GMS contracts or handing back existing GMS contracts. In our view, the proposed changes to the tax treatment of GMS income do not reflect the commercial realities of the GMS contracts themselves.  The changes that will be required for medical practices to comply with Revenue’s proposed tax treatment of GMS income of GPs are contrary to the Primary Care/Partnership GP model that the HSE and Government are advocating. CCAB-I is concerned that the commercial impracticalities of the proposed tax treatment will not only affect the individual GPs tax position but will ultimately impact patient services. While the full impact may not be felt until 12 to 18 months from implementation, this change will most likely lead to irreconcilable (and unnecessary) damage to General Practice and patient care. We therefore recommend that Revenue do not proceed with the implementation of these proposals.  In light of such practical difficulties, CCAB-I requested that the tax treatment of income earned under contract by individuals acting on behalf of a practice be assessed on the principal or partners of the practice.   Revenue has confirmed that it will publish an updated Tax and Duty Manual in the coming weeks, in relation to the tax treatment of GMS income of GPs. CCAB-I will continue to liaise with Revenue and will inform members via Tax News.  

The Platform Operators (Due Diligence and Reporting Requirements) Regulations 2023 were published in July 2023. This Statutory Instrument brings into effect the OECD Model Reporting Rules for Digital Platforms which will require UK digital platform operators to report details of their sellers to HMRC from 1 January 2024.   The regulations set out, either directly or by reference to the requirements in the published OECD rules, the information which platforms will need to collect and verify, the actions they will be required to take and penalties for failing to comply with the requirements.     In advance of commencement, HMRC is expected to publish detailed guidance in its International Exchange of Information Manual. 

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. The latest Trader Support Service bulletin is also available, and the Institute has developed a new graphic setting out the key milestones in the Windsor Framework (“WF”). Windsor Framework infographic  In the wake of the WF agreement, traders, and businesses across the island of Ireland need to be mindful of the various changes taking effect over the coming months and years as the provisions of the WF are gradually phased in.   To help navigate this landscape of new regulations, the Institute has prepared a high-level infographic which summarises the key dates and changes that traders need to be aware of in the short to medium term. As further developments arise, members will be kept up to date and informed in Chartered Accountants Tax News. As these changes bed down, contact us to share your feedback and any problem areas which arise which we can then share with UK Government officials.  Miscellaneous updated guidance etc.   The following updated guidance, and publications relevant to EU exit are available:-  Known error workarounds for the Customs Declaration Service (CDS);  Customs declaration completion requirements for Great Britain;  Data Element 2/3: Documents and Other Reference Codes (Union) of the Customs Declaration Service;  List of customs training providers;  Search the register of customs agents and fast parcel operators;  Internal temporary storage facilities (ITSFs) codes for Data Element 5/23 of the Customs Declaration Service;  External temporary storage facilities codes for Data Element 5/23 of the Customs Declaration Service;  4-digit to 3-digit procedure to additional procedure code correlation matrix for imports;  Appendix 1: DE 1/10: Requested and Previous Procedure Codes of the Customs Declaration Service (CDS);  Appendix 2: DE 1/11: Additional Procedure Codes of the Customs Declaration Service (CDS);  Attending an inland border facility; and  How to subscribe to the New Computerised Transit System. 

This month’s tidbits cover updated information on HMRC’s Governance arrangements and how HMRC resolves civil tax disputes. 

In a recent interview, Ioanna Mitroytanni (Deputy Head of the Company Taxation Initiatives unit in the EU’s Directorate-General for Taxation and Customs Union) and Ana Xavier (Head of Economic Analysis, Evaluation and Impact Support Unit) set out the vision behind the Business in Europe: Framework for Income Taxation (BEFIT) proposal. They explained that the proposals should assist not only large multinationals but also domestic businesses struggling to make the jump into cross-border sales in the EU. They are aiming to commence BEFIT applications from 1 July 2028, which in their view should allow sufficient time for multinationals to implement the Pillar Two legislation.