Chartered Accountants Ireland acknowledges that Revenue has clarified its guidance regarding completion of a carbon footprint exercise by applicants to the Temporary Business Energy Subsidy Scheme (TBESS). The clarification by Revenue was made on 5 December, and states that there is no legal requirement for applicants to either complete a carbon footprint exercise or demonstrate that they are taking steps to reduce energy use and environmental impact.   Businesses are asked to ‘acknowledge a request’ to take steps to understand and reduce their energy use by completing the Government’s Climate Toolkit for Business, although there is no legal requirement to do so, and not doing so will have no impact on a business’ eligibility for the scheme.   Chartered Accountants Ireland also recommends that business use this toolkit as an opportunity to manage costs and manage their carbon emissions. Commenting, Chartered Accoutants Ireland's Sustainability Officer Susan Rossney said that businesses are struggling with competing priorities, and that the Government's toolkit could help: "We know that transformation is inevitable and it is possible for business to surivive and thrive in this environment. But businesses are struggling with competing priorities. They want to 'do the right thing' and reduce emissions, but have to balance pressures of work and year-end deadlines. While not obligatory to use, the Government's toolkit can help with this." The toolkit is easy to use, and requests information that is readily available in invoices from providers of energy, waste and water.  "It is not necessary for businesses to have all the data to hand in order to successfully complete a carbon footprint; for example, an estimate of vehicle fuels used for business travel is permitted if this is not readily available".  Businesses can also make use of the resources available on Chartered Accountants Ireland Sustainability Centre, where you can find a short video with tips on how to use the Government's Climate Toolkit for Business.   

In Irish news, Revenue has updated its guidance on making a claim for the Temporary Business Energy Support Scheme and Minister Donohoe is re-elected as President of the Eurogroup. In UK news, HMRC has sent an update on basis period reform and the Autumn Finance Bill is now progressing through the House of Lords. On the International front, the European Commission proposes new reporting rules for crypto-asset transactions. Ireland Revenue has updated its guidance on the Temporary Business Energy Support Scheme (TBESS) and recorded a webinar explaining the Registration and Claims process. The Minister for Finance and President of the Eurogroup Paschal Donohoe has been unanimously re-elected for a second term as the President of the Eurogroup. UK Read the update from HMRC on basis period reform. The Autumn Finance Bill is now progressing through the House of Lords.   International The European Commission has proposed new tax transparency rules for all service providers facilitating transactions in crypto-assets for customers resident in the European Union. 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.      

As part of the ongoing work of the OECD/G20 Inclusive Framework on BEPS (Inclusive Framework) to implement the Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy, the OECD is seeking public comments on the main design elements of Amount B under Pillar One. Amount B provides for a simplified and streamlined approach to the application of the arm’s length principle to in-country baseline marketing and distribution activities, with a particular focus on the needs of low-capacity countries.

At the final scheduled meeting of the Economic and Financial Affairs Council (ECOFIN) under the Czech Presidency of the European Council, ECOFIN approved its report to the European Council on tax issues. The report provides an  overview of the progress achieved in the Council during the term of the Czech Presidency, as well as an overview of the state of play of the most important dossiers under negotiations in the area of taxation.

The European Commission has proposed a series of measures to modernise and make the European Union’s VAT system function better for businesses and make the system more resistant to fraud by embracing and promoting digitalisation. Data from 2020 revealed that Member States lost €93 billion in VAT revenues with conservative estimates attributing one quarter of the missing revenues to VAT fraud linked with intra-EU trade.

The European Commission has proposed new tax transparency rules for all service providers facilitating transactions in crypto-assets for customers resident in the European Union. The new rules will take the form of an amendment to the Directive for Administration Cooperation (DAC) and will be referred to as DAC8. The proposal is consistent with the OECD initiative on the Crypto-Asset Reporting Framework (CARF) and the amendments to the OECD Common Reporting Standard (CRS).

Earlier this month, HMRC wrote to the House of Lords Economic Affairs Finance Bill Sub-Committee, setting out the Government’s decision on which of the options for easements for provisional figures is being taken forward in the context of basis period reform, and also provided an update on overlap relief and communications on this change. The key points from this letter were set out in an email to Chartered Accountants Ireland and are reproduced below. Provisional figures After considering the feedback provided by stakeholders and the legislative complexity and delivery implications of the options available, the Government has decided to allow businesses to amend provisional figures in the normal time limits for amendments. This will effectively allow businesses and agents to amend provisional figures at the same time as the business’s next tax return. HMRC will give effect to this easement by changing its guidance on provisional figures to relax the condition that currently asks businesses to make amendments to provide final figures ‘without delay’. This change will be made before the start of the transition tax year 2023/24. The Government views this option as providing the best balance between targeted administrative burden savings and avoiding adding significant new complexity to the tax system. Engagement on other options showed that they would require significant new legislation, complex eligibility rules, or would have wider effects on Income Tax Self-Assessment that would outweigh the benefits of removing the administrative burden associated with provisional figures. Overlap relief The provision by HMRC of figures for overlap relief was a recommendation of this Institute in its response to the consultation on basis period reform in summer 2021. According to the letter to the House of Lords Economic Affairs Finance Bill Sub-Committee, the Government is continuing to explore methods of providing overlap relief figures to taxpayers and their agents; whether by informing businesses and agents of overlap relief figures that HMRC holds, or providing a method for businesses and agents to request these figures from HMRC. In recognition of feedback that some businesses are seeking to change accounting date in 2021/22, for such businesses HMRC will now be able to provide details of overlap relief figures or historic profit figures on request, if these figures are recorded in HMRC systems. Taxpayers should ring the HMRC Self-Assessment Helpline and agents should ring the Agent Dedicated Line if they need this information to complete a 2021/22 tax return. Businesses which are changing accounting date or using overlap relief in 2022/23 or 2023/24 should wait until HMRC is able to provide further information on overlap relief support for these businesses and agents; HMRC is planning to provide certainty on this in the coming months. Communications on basis period reform Alongside specific comms on overlap relief and provisional figures, the Government is continuing to explore additional general communications for basis period reform. For unrepresented taxpayers, HMRC is also looking at providing specific and detailed support to help these individuals complete their tax returns for the transition tax year. HMRC has started more general communications about basis period reform, such as through news articles on GOV.UK and in the Agent Update and Employer Bulletin and plans to continue and expand this comms campaign to raise more awareness about basis period reform.

Last month, the Autumn Finance Bill 2022 passed all remaining stages in the House of Commons. The Bill is currently progressing through the House of Lords, where first reading took place on Thursday 1 December 2022. All remaining stages in the House of Lords are due to take place on 20 December 2022. As the Bill is a money bill, the House of Lords cannot make any amendments to it hence its passage through the Lords is a formality only and will be followed by Royal Assent. No date for Royal Asset is currently available.

HMRC’s monthly performance report for October 2022 has been published. At a recent appearance before the Treasury Committee, HMRC’s Chief Executive confirmed that waiting times are still around 15 minutes and need improvement. The recent statistics were published on the same day that HMRC experienced a phone outage. At a meeting of the Representative Body Steering Group last week, HMRC confirmed that it is investigating the cause of the outage. Chartered Accountants Ireland expressed that it was important for the root cause of the outage to be identified particularly given that it is now busy self-assessment season with the 2022/23 filing deadline approaching next month. HMRC is also considering the impact of the Royal Mail postage strikes on its activities and it was confirmed that where required, HMRC will be “sensitive” to taxpayers in the context of time bound inward and outward post. Chartered Accountants Ireland regularly discusses HMRC performance at forum meetings and is happy to accept feedback at any time.

The latest HMRC news and information bulletin from 8 December is now available. Key items which may be of interest include the publication of the latest Administrative Burden Advisory Board (“ABAB”) Annual Report last month and how to check if a business is subject to the plastic packaging tax. The ABAB report recommends that Making Tax Digital for income tax should be delayed by at least a year to properly address and resolve areas of concern. HMRC has also contacted us about a number of changes to the HMRC app, including a new function that allows taxpayers to copy and paste their Self-Assessment Unique Taxpayer Reference (“UTR”). Taxpayers can easily share their UTR with their tax agent, and by using the copy and paste function they can be sure it’s the correct UTR. HMRC has published a YouTube video showing just how easy it is to find your UTR on the app. Additional features added to the app also allow taxpayers to pay their Self-Assessment tax bill using the app. The improved app functionality will be promoted ahead of the Self-Assessment tax return deadline on 31 January 2023.  

If a museum or gallery is named in an order made by HM Treasury, VAT may be recovered on goods/services bought and used by it for non-business activities. This is particularly relevant to museums and galleries which offer free access. Applications to be named by Treasury Order have now reopened.  The closing date for this round of applications is 5pm Tuesday 3 January 2023. In order to be able to apply for admission to the list named by HM Treasury, the museum or gallery must:- be open to the general public for at least 30 hours per week, without exception; ·offer free entry, without prior appointment; hold collections in a purpose-built building; and display details of free entry and opening hours on the museum website. More information is available in the guidance. 

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit and HMRC has also published updated guidance about the law and regulations for Customs Civil Penalties. Miscellaneous updated guidance etc. The latest guidance updates, and publications relevant to EU exit are as follows:- Apply to operate a customs warehouse; Apply to delay or pay less duty on goods you import to process or repair; Apply to pay less duty on goods you export to process or repair; Apply to pay less duty on goods you import for specific uses; Check if an alcohol wholesaler in the Isle of Man is approved; Software developers providing customs declaration software; Check simplified procedure value rates for fresh fruit and vegetables; Attending an inland border facility; and Apply for release of a private vessel on payment of Customs Duty and VAT (C384 (Vessels)).