The Institute has written to Tánaiste and Minister for Finance, Simon Harris and Minister for Enterprise, Tourism and Employment, Peter Burke to outline the administrative burdens arising from tax issues affecting cross-border and remote/hybrid working on the island of Ireland. The issues outlined in the letters reflect the outputs from the Institute’s Joint Tax Working Subgroup on Cross‑Border and Remote/Hybrid Working, established in 2024 and highlight the key obstacles and challenges currently hindering trade and the full realisation of a truly integrated all-island labour market. Amongst the issues raised were: The added administrative responsibilities for both employers and employees of operating a dual payroll. The administration burden and complexities arising when the social welfare obligations and benefits arise under a different jurisdiction than the country of employment. The uncertainty on the tax treatment of pension contributions and retirement income in the context of hybrid working arrangements for frontier workers. The need for education, training and better guidance from government bodies and the tax authorities. We will continue to advocate on this issue and welcome the opportunity to meet with the Ministers to present our findings in greater detail and to discuss potential solutions. We also intend raising these issues with the Irish Minister’s counterparts in Northern Ireland in the coming days.

In this week’s cross-border trading corner, we bring you the latest guidance updates and publications. The most recent Trader Support Service bulletin is also available as is the latest Brexit and Beyond newsletter from the Northern Ireland Assembly EU Affairs team. In December last year, the European Commission announced a reinforcement of controls on products imported into the EU which you can read more about below. And last week in the House of Lords, Lord Newby moved a ‘Motion to take Note’ on the case for a UK-EU customs union and the impact of connections with the EU single market on the UK economy which was then debated in the House.   Update on reinforcement of controls on products imported into the EU In December the European Commission announced a reinforcement of controls on products imported into the EU. Within the measures listed, was an increase in the frequency of checks on consignments of goods of animal origin entering the EU. The Commission wrote to DEFRA stating that the frequency rates will now be updated every four months; previously this was reviewed every six months. The last series of rate changes was made on 1 October 2025, and the Commission has launched the next series of rate changes which took effect from 1 February 2026. More details are available in an email from the UK Government’s Borders Directorate Communications Team. Miscellaneous guidance updates and publications This week’s miscellaneous guidance updates and publications are as follows: Designated export place (DEP) codes for Data Element 5/23 of the Customs Declaration Service, Maritime ports and wharves location 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, Find out what types of Authorised Economic Operator status you can apply for, Apply to operate a customs warehouse, How to use a customs warehouse, Importing sanitary and phytosanitary controlled goods into Great Britain that interact with the Border Trade Matching Service, and Simplified rates for bringing personal goods into the UK.  

In this week’s detailed updates which you can read more about below, the House of Lords Finance Bill Sub-Committee has published its report into the Finance Bill 2025/26 and the Government recently announced that indirect emissions associated with the production of Carbon Border Adjustment Mechanism (CBAM) goods will not be included in the scope of the UK CBAM at implementation on 1 January 2027. In other news this week: The Courts and Tribunals Judiciary has published a Practice Statement which gives guidance to the First Tier Tribunal Tax and Chancery Chamber on the procedure to adopt towards applications for extension of time, The House of Commons Library has published a research briefing ‘Income tax: freezing the personal allowance and the higher rate threshold’ and an updated briefing on the Autumn Budget and the Finance Bill 2025/26, and HMRC’s Guideline for Compliance (GfC) team has updated GfC7 ‘Help with Common Risks in Transfer pricing Approaches.’  Finance Bill Sub-Committee publishes report on Finance Bill 2025/26 The House of Lords Finance Bill Sub-Committee has published its report into the Finance Bill 2025/26 ‘Inheritance tax measures: unused pension funds and agricultural and business property reliefs’. Last October, the Institute submitted evidence to Committee as part of its inquiry into the Bill which set out our concerns in relation to the original draft legislation on the changes to the Inheritance Tax (IHT) reliefs agricultural property relief and business property relief and its impact on farms and family owned businesses in Northern Ireland. Subsequently, the Institute’s UK Tax Manager Leontia Doran gave evidence to the Committee last October. The report from the Committee welcomes the subsequent changes announced by the UK Government in both the Autumn Budget 2025 and on 23 December 2025 to the draft legislation. However, it highlights that the changes are not by themselves sufficient to resolve many of the Committee’s concerns about what the reforms will mean in practice. The Committee also highlighted how continued revision of these measures reflects underlying problems with the Government’s approach to tax policy making, in particular in relation to its approach to consultation. The report also sets out a range of recommendations in relation to both policy changes, many of which reflect recommendations previously made by the Institute. Update on UK CBAM Finance Bill 2025/26 includes the final CBAM primary legislation which contains a number of technical legislation changes including that indirect emissions associated with the production of CBAM goods will not be included in the scope of the UK CBAM at its implementation on 1 January 2027. This has been delayed until 2029 at the earliest which, according to an email from HMRC, reflects ‘continued support for the Energy Intensive Industries (EII) Compensation Scheme’.  HMRC has also published a CBAM Policy Update. Recognising that refineries play a role in energy security and the UK's industrial base, a Call for Evidence will be published at some point this year on the fuel sector. The Government is also considering the feasibility and impact of including refined products in the scope of the CBAM in the future.   A number of technical changes have also been made to the draft CBAM legislation following a consultation last April, the consultation outcome for which has now been published. These changes include:     the free allowance adjustment in the CBAM rate calculation will be based on a sectoral average of emissions covered by Free Allowances over a baseline period, which will be adjusted annually to reflect the phase out of Free Allowances under the UK Emissions Trading Scheme,  carbon price relief has been extended to enable recognition of carbon prices incurred under carbon border adjustment mechanisms, inclusion of an exemption for emissions embodied in UK-produced precursor goods, imported into the UK as part of a complex CBAM good. This aims to prevent a carbon price being paid twice on the same goods, and also aims to reduce the administrative burdens for businesses,  inclusion of an exemption for emissions embodied in CBAM goods under temporary admission in the UK, with full relief from customs duties which aims to ensure the CBAM only applies if goods enter the UK market and present a carbon leakage risk,  a time limit for repayment claims set at three years for taxpayers who have made an error on their return and overpaid the CBAM, and removal of the group treatment provision following feedback that this would provide limited benefits to businesses.    Anyone wishing to keep up to date with policy developments in this space should contact cbampolicyteam@hmrc.gov.uk. 

The 2025 Autumn Budget launched a Call for Evidence on tax supports for entrepreneurs to which the Institute is formulating a response. This is focusing on how UK tax policy can better support investment in innovative high growth companies. We’d like to hear your views on this issue before Monday 16 February 2026. Contact us by email to participate. In the Call for Evidence which is open until 28 February 2026, the Government’s view is that a shortfall in domestic scale-up capital is causing some of the UK’s most innovative companies and founders to move abroad. To address the issue, views are sought on: how effective existing tax supports are, any gaps in the tax system for founders and scaling companies, and options and ideas to improve, rebalance, and better target current supports that would allow the Government to fill these gaps where needed.  A number of changes were made to several of the UK’s tax advantaged venture capital schemes in the 2025 Autumn Budget which aim to enable larger and more established companies to continue to qualify to use the schemes. However, the Call for Evidence notes that these changes “take the existing schemes as far as possible within their current design”. As a result, the government is keen to consider how it could provide more targeted and effective support which also represents good value for money for the taxpayer. 

Making Tax Digital (MTD) for income tax commences in just over two months’ time from 6 April 2026 for sole traders and landlords with gross ‘qualifying income’ (combined income from trading and property before any deductible expenses) above £50,000. Are you ready for this change in UK tax administration? If not, now is the time to prepare. To assist you in your preparations, the Institute recently launched its MTD hub, a one stop shop of resources developed by the Institute to assist members and taxpayers in their preparations. The hub also contains the latest news and links to HMRC resources and guidance. You can also watch our video on the MTD hub here. Yesterday HMRC wrote to the Institute reiterating the importance of taking steps to prepare now ahead of the first tranche of mandation. It also asked us to share links to some important HMRC resources: MTD agent step by step guide, Register for specialist MTD support – these sessions provide agents with direct access to HMRC specialists that can provide tailored MTD readiness agent support, HMRC communications resources – these resources can be used to align your practice’s MTD messaging with what clients may see from HMRC and also provide ready-made products you can use to educate clients, and Sign up for a HMRC MTD webinar – these webinars cover planning steps, actions to take now, how to sign-up clients for April 2026 and answers to questions. The first webinar is scheduled for Wednesday 11 February 2026. Are you looking for the top tips on how to get ready? Check out HMRC’s new MTD agent toolkit. This aims to provide a practical aid to help guide agents through this journey in a logical order so that agents can be confident that they and their clients will be ready ahead of April 2026. The new toolkit includes help with understanding the changes, planning (including “segmenting clients”), preparing the practice (including the “service offer”), preparing clients (including a conversation checklist tool) and helpful resources including videos and webinars. Alongside this, the agent-specific content on HMRC’s MTD campaign page is also being updated to provide agents with a dedicated resource which will provide a clearer more streamlined journey and direct access to tailored guidance and resources. HMRC has also recently updated its guidance on the various MTD for income tax exemptions which are available as follows: Find out if you can get an exemption from Making Tax Digital for Income Tax – this page now contains the full list of exemptions from MTD for income tax, and Apply for an exemption from Making Tax Digital for Income Tax which explains the exemption applications process if a taxpayer is not automatically exempt. HMRC is keen to stress that as with all its MTD guidance, guidance will continue to be iterated ahead of April 2026 to ensure that policy and legislation are clearly reflected. As a result, we recommend that members bookmark these pages and regularly check for the latest updates which will also be covered in Chartered Accountants Tax news and on our MTD hub. For any taxpayers currently participating in MTD testing, HMRC is highlighting an issue with how payments on account (POAs) for 2025/26 and 2024/25 balancing payments of income tax and Class 4 NIC for self-assessment (SA) are treated. As the information for these taxpayers is split between different HMRC systems, any 2024/25 balancing SA payment remains within HMRC’s non-MTD system, whilst 2025/26 SA POAs are within the new MTD system. Because of this, some taxpayer statements show SA POAs as “transferred to digital” or “nil” and therefore do not show the full picture of any payments which were due on 31 January 2026. Taxpayers should access both the MTD service and the legacy SA service from within their Personal Tax Account (PTA) or Business Tax Account (BTA) to see the total balance which fell due. To address this, HMRC issued a letter explaining this issue to those affected which explained where to find their SA POAs information and how to work out what they still needed to pay. The letter also explained that POAs marked as “transferred to digital” were still due for payment by 31 January and what needed to be done if these did not appear in their MTD account. This is particularly important as interest will be charged on any amounts not paid by the 31 January 2026 due date. A message was also placed in the taxpayer’s MTD account advising them to check their SA online account. Agents should also ensure that they check both systems before advising clients. HMRC advises that work is already underway on longer term solutions for this issue for the future.

In Irish news, today brings the deadline for several engagement and disclosure opportunities for businesses and Revenue has issued a press release following Storm Chandra. In UK news today, the Institute has presented the case for a lower corporation tax rate for Northern Ireland to two Northern Ireland Assembly committees, and it’s now just five days until the 2024/25 self-assessment online filing deadline. In International news, the OECD has published updated transfer pricing country profiles. Ireland 1. Read about the various submissions due today including the disclosure opportunity for businesses to regularise payroll obligations for 2024 and 2025 following the Karshan case, the joint public consultation on electronic withholding tax (eWHT) and the VAT modernisation survey. 2. Revenue has issued a press release offering guidance for those affected by Storm Chandra on meeting their tax compliance obligations. UK 3. Read about our meetings with the Northern Ireland Assembly’s Finance and Economy Committees to discuss the Institute’s continued advocacy for a reduced corporation tax rate in Northern Ireland. 4. We remind readers that the 2024/25 online self-assessment filing deadline is Saturday 31 January 2026. International 5. The OECD has issued a fourth batch of updated transfer pricing country profiles. Keep up to date with all the latest Irish, UK, and international tax developments through Chartered Accountants Ireland’s Tax Newsletter. Subscribe to the Tax News by updating your preferences in MyAccount. You can also read this week’s Cross-border developments and trading corner here.  

Revenue has issued a press release acknowledging the difficulties the recent exceptional weather may have caused for timely tax compliance.  They have also stated that they will work with adversely impacted taxpayers and businesses to help maintain their good compliance records despite the disruption. The press release outlines the strong record that Revenue has of agreeing flexible payment arrangements for taxpayers and businesses facing temporary cash‑flow pressures. It also advises those impacted by Storm Chandra to contact the Collector-General’s office once their situation permits, to agree mutually agreeable arrangements for restoring timely tax compliance.

Last Wednesday, representatives from the Institute met with members of the Northern Ireland Assembly’s Finance and Economy Committees in Stormont to discuss the Institute’s ongoing campaign to reduce the corporation tax rate in Northern Ireland. The Institute spoke about the need for a coherent long term industrial policy in Northern Ireland that attracts investment, creates secure, well-paid jobs, and fosters innovation and entrepreneurship. As part of this overall industrial strategy, Northern Ireland needs to reduce its corporation tax rate and provide policy certainty for potential investors. The feedback from members of each committee was positive and informed. It was clear that they are deeply committed to improving the economic environment in Northern Ireland and the living standards of all citizens. The key issues and Institute stance Addressing the challenge of the impact on the block grant that Northern Ireland receives every year, the Institute outlined various measures that could be utilised to mitigate the block grant reduction, most notably the use of a low interest loan from Westminster to manage the initial drop in corporate tax revenue that would arise immediately after a corporation tax rate reduction. Phased introduction of a lower corporation tax rate could also be implemented to reduce the immediate impact on the block grant. From an economic perspective, previous research from the ESRI shows that a reduction in corporate tax rates would increase investment in Northern Ireland by 7.5 percent which would also lead to substantial employment opportunities for people in the region. Progress to date and next steps  The next step is to take the campaign to Westminster to push the agenda forward. As part of this, the need for cross party support to reduce Northern Ireland’s corporation tax rate is crucial in order for progress to be made with HM Treasury; this point was also highlighted during last Wednesday’s meeting.  To begin progressing the issue nationally, last November the Institute wrote to the Exchequer Secretary to the Treasury on this issue which highlighted that the ultimate aim of a lower rate is for it to become self-funding in the longer term, but that initially it would necessitate a replacement loan at a low interest rate from HM Treasury to fund the necessary block grant reduction. To date, the Institute has met with a broad range of stakeholders on this issue and has now met with all the major political parties represented in the Northern Ireland assembly.  Last year the Institute launched its refreshed campaign for a lower corporation tax rate when it published its position paper ‘Enhancing Our Competitiveness: The case for a reduced rate of corporation tax in Northern Ireland’. Share your experiences and insights If you work in a local business and would like to participate in the Institute’s campaign by being a voice of support for a lower rate, contact us by email.

There are a number of non-routine deadlines arising this week for taxpayers and agents. On the tax payment front, there is the disclosure opportunity for businesses to regularise payroll obligations for 2024 and 2025 following the Karshan case (explained further below). The deadline for disclosures is 5pm on Friday 30 January 2026. On the consultation front, two ongoing public consultations, on electronic withholding tax (eWHT) and VAT modernisation also close at 5pm on Friday 30 January 2026 . We have included further information below as well as in our newsletter last week. We strongly recommend that readers complete these surveys if applicable. Please note that you do not need to include the identifying information at the start of the surveys to progress and Revenue has advised us that surveys without taxpayer identification numbers and other such information will still be accepted by them. The disclosure and settlement opportunity to regularise payroll obligations for 2024 and 2025 gives businesses, that may have misclassified employees as contractors, the mechanism to have the correction treated under the Code of Practice for Revenue Compliance Interventions without the imposition of interest and penalties.  Further details of the disclosure opportunity are available in our newsletter item last week. The joint public consultation on eWHT is inviting stakeholder to share feedback on a proposed electronic withholding tax (eWHT) system in Ireland, which aims to introduce real-time taxation for self-employed taxpayers subject to withholding tax (WHT). Further details are available in our earlier newsletter feature. The VAT modernisation survey is aimed at VAT-registered businesses managed by Large Corporates Division and will inform Ireland’s implementation of the EU’s VAT in the Digital Age (ViDA) package and the implementation of eInvoicing in Ireland. Further details are available in our earlier newsletter items.

There’s just five days to the 2024/25 online self-assessment (SA) filing deadline on Saturday 31 January 2026. By way of reminder, on Saturday 31 January HMRC will be operating a restricted service with assistance only available via webchat and no telephone support available on 31 January, except for a call-back service for vulnerable taxpayers. Anyone who may need to call HMRC for assistance before filing a return is therefore advised to file that return on or before Friday 30 January 2026 to ensure they are able to call HMRC and receive the necessary assistance. HMRC has also asked us to remind agents who are using the SA reactivation option on the Agent Dedicated Line (ADL) that telephone agents on this part of the ADL cannot deal with other general SA queries. Option 1 on the ADL (the reactivation option) is for SA reactivations only. Advisers are unable to address any other SA enquiries via this route and are also unable to transfer the agent to the general enquires line.  Selecting the wrong option increases the time that the agent can get their issue resolved which causes frustration for the agent and adviser alike.

Revenue has published new guidance on the enhanced deduction for eligible construction expenditure introduced by Finance Act 2025. The enhanced deduction allows companies to claim 25 percent of eligible construction costs, up to €50,000 per apartment, for completed developments. In broad terms, a completed development refers to a qualifying apartment block that meets certain defined conditions. A qualifying apartment block is a multi-storey building comprising of at least 10 apartments and is either:  a newly constructed building, or  a building or structure that, as part of a qualifying refurbishment, has undergone a material change. To claim the enhanced deduction, the company must be a relevant person which is specified as a property developer or a relevant contractor. The relevant person must be carrying out a relevant property development trade or a qualifying trade when developing the completed qualifying apartment block and the deduction must be pro‑rated based on the company’s beneficial ownership share in the development. The enhanced deduction is in addition to the standard trading deduction and further details of the definitions are included in the guidance together with examples and calculation information.

In this week’s detailed miscellaneous updates which you can read more about below, the Scottish and Welsh Budgets have been published and HMRC has published draft regulations for technical consultation on the construction industry scheme (CIS). In other news this week: As the latest Finance Bill makes its way through Parliament, HMRC has published a collection page of supporting documents related to the Bill and its passage,  Agent Update 139 is available, The latest schedule of HMRC Talking Points live and recorded webinars for tax agents are available for booking. Spaces are limited, so take a look now and save your place, and finally, Check HMRC’s online services availability page for details of planned downtime and the online services affected. Scottish and Welsh Budgets The Scottish and Welsh Budgets took place earlier this month. The Scottish Parliament has published a tax infographic for the Scottish Budget 2026/27 and the Scottish Fiscal Commission’s Report, Scotland’s Economic and Fiscal Forecasts – January 2026 is available along with a one-page graphic of key figures and a summary document. More detailed information on the Welsh Budget is set out in the detailed spending plans. Changes to the CIS HMRC has published draft regulations for technical consultation that are intended to simplify administration of the CIS. The proposed changes include: an exemption for payments made to local authorities or public bodies from the scope of the CIS. and a requirement for construction contractors to file a nil return when they have not paid any subcontractors in a month, unless they have notified HMRC in advance that they will not make any such payments that month. The proposed changes will take effect from 6 April 2026. The technical consultation closes on 3 February 2026.