Business Tax Briefing

Finance Bill progress update

The remaining Commons stages of Finance (No. 2) Bill 2024-26 took place on 11 March 2026. During the Report Stage debate, the only amendments accepted were those tabled by the government last week (see previous Business Tax Briefing for details). MPs then voted to give the Finance Bill its Third Reading.

The Bill has now moved to the House of Lords where it had its First Reading on 12 March 2026. The Lords’ version of the Finance Bill, reflecting all amendments made during the Bill’s passage through the House of Commons, has been published. This will effectively be the text of Finance Act 2026, as the Lords cannot change the Bill. As a reminder, the House of Lords has provisionally scheduled its Second Reading and remaining stages for Tuesday 17 March 2026, after which the Bill will be sent for Royal Assent.

HMRC publish consultation on standardising corporation tax computations

On 10 March 2026, HMRC published a consultation titled Modernising and standardising company tax returns. The consultation document sets out HMRC’s plans to develop a prescribed “standardised, fully tagged format” for corporation tax computations that accompany online submissions of the CT600 Company Tax Return form, applicable from October 2027 (in pilot) and mandated from September 2028. In addition, from 1 April 2027, HMRC propose to change their policy to require amendments to corporation tax computations and returns to be submitted online. The consultation closes on 2 June 2026. Further details are on tax@hand.

HMRC publish consultation on extending uncertain tax treatment regime

On 12 March 2026, HMRC published a consultation on proposed changes to extend the uncertain tax treatment (UTT) regime. The consultation seeks views on the government’s proposals to bring individual taxpayers and trusts within the scope of UTT, extend the taxes within scope to include stamp duty land tax, national insurance contributions, payments under the construction industry scheme, capital gains tax, and inheritance tax, and introduce a new ‘trigger’. The new ‘trigger’ would capture situations where there is more than one credible legal interpretation and HMRC’s view is not known. The government intends that any legislation will be introduced in the next available Finance Bill and apply to returns filed after 1 April the following year. The consultation closes on 4 June 2026.

Upper Tribunal clarifies approach to question of whether a person has begun to carry on a trade

The Upper Tribunal (UT) has handed down its decision in Putney Power Limited and Piston Heating Services Limited v HMRC, setting aside the original First-tier Tribunal (FTT) decision for errors of law, but reaching the same outcome in favour of HMRC for different reasons. The case focusses on whether Putney Power Limited (‘Putney’) and Piston Heating Services Limited (‘Piston’), had met a condition requiring them to have begun to carry on a trade.

On 4 April 2016, Putney and Piston issued shares to investors pursuant to the Enterprise Investment Scheme (EIS). However, HMRC and the taxpayers disagreed on whether the companies had begun to carry on a trade within two years of the share issue date, i.e. by 4 April 2018, and therefore whether the claims for relief under the EIS rules were valid. HMRC argued that while Putney and Piston’s activities prior to this date were legitimate business activities, they amounted to nothing more than getting ready to trade. The UT sets out that the companies’ anticipated trades consisted of the same two broad strands: receiving income by using gas to generate electricity and selling the electricity as soon as it was produced and receiving income by entering into the capacity market and agreeing to stand by and being ready to generate and sell electricity if called upon to do so. On a multi-factorial assessment of the facts and circumstances, the UT concluded that, as at 4 April 2018, both companies were still preparing to trade. The fact the companies were incapable of generating any income from their chosen trades on or before this date represented a firm pointer against the proposition that they had begun to carry on that trade. Although Putney had entered into a matrix of contracts, this formed part of its preparations to trade, rather than conducting the trade itself. By the same date, Piston had not entered into any binding commitments that would result in financial risk or reward.

Court of Appeal dismisses taxpayers’ appeal on partnership and intangible fixed assets

The Court of Appeal (CA) has unanimously dismissed the taxpayers’ appeal in Muller UK & Ireland Group LLP and others v HMRC. In 2013, three UK resident companies incorporated a limited liability partnership (LLP) and transferred their trades and certain assets to it. HMRC disputed whether intangible assets and goodwill transferred to the LLP should, as the taxpayers contended, be treated as falling within the intangible fixed assets regime of Part 8 Corporation Tax Act 2009 for the purposes of calculating the taxable profits attributable to each member of the LLP. This required consideration of the general rules for calculating the taxable profits arising to corporate partners from a trade carried on by a partnership – which requires computation of the profits as if a notional company were carrying on the same trade – and how the notional company concept interacted with Part 8 and, in particular, its rules on assets acquired from related parties.

The CA agreed with the 2024 decision of the Upper Tribunal (UT), that the absence of specific words treating the notional company as having the ownership attributes of the relevant partnership did not mean that the key related party provisions in the intangible fixed asset rules were incapable of applying. The CA agreed that, in order to calculate taxable profits, it was necessary to attribute the partnership’s ownership characteristics to the ownership of the notional company. Applied to the facts in this case, this meant each corporate member was to be considered a “related party” of the notional companies, and accordingly, the assets transferred remained outside of the scope of Part 8.

EMEA Dbriefs webcasts

As a reminder, the next EMEA Dbriefs webcast will take place on Tuesday 17 March 2026 at 12.00 GMT/13.00 CET. In EU Public Tax Reporting requirements in 2026, hosted by Mark Kennedy, our panel will discuss the EU Public Country by Country Reporting (PCBCR) requirements. We’ll explore the PCBCR rules, including potential early reporting requirements; commercial, tax and other reputational risks in relation to the disclosures; approaches to gathering CBCR data; technology options for gathering, verifying and reporting data; and choices which could potentially mitigate the compliance burden on businesses.

On 18 March 2026 at 10.00 GMT/11.00 CET, Chelsea Abraham and Kathryn Crane will be hosting a further EMEA Dbriefs webcast, Global Game Plan: Immigration Considerations for Short-term Sports Visitors. Our immigration specialists from across the UK, EU, and Middle East, will demystify the critical considerations for sports professionals and their support teams, concentrating on short-term travel.