Business Tax Briefing

A weekly round-up of corporate, employment and indirect tax news  

02/10/2020

COVID-19: help and information

To help inform our clients and to enable them to understand how businesses can respond, recover and thrive in these times we are running a series of webinars focused on the economy, on particular sectors and on key roles within an organisation. You can register for future webcasts and view archived webcasts here. You can access more information here and also at our Deloitte global COVID-19 webpage. You can also sign up to our Deloitte Tax Atlas COVID-19 Tax and Fiscal Measures microsite, which provides a high-level summary of tax and fiscal coronavirus measures that have been announced by governments, and our COVID-19 Signal Topic email alerts, here.

Commission to appeal Apple State aid case to CJEU

The European Commission has decided to appeal to the CJEU against the General Court's judgment of July 2020 in the Apple/Ireland State aid case. The General Court annulled the Commission's decision of August 2016 that Ireland granted illegal State aid to Apple via tax rulings issued by the Irish Revenue on the method to determine chargeable profits in Ireland. Ireland’s Minister for Finance Paschal Donohoe TD has issued a statement reiterating Ireland’s contention that no State aid was given.

Self-assessment: self-serve Time to Pay arrangements

Further to announcements in the Chancellor’s Winter Economy Plan, HMRC have confirmed that self-assessment taxpayers can now apply online for additional support to help spread the cost of their personal tax bill into monthly payments. The limit for the online payment plan service was £10,000. From 1 October 2020, this has increased to £30,000 for self-assessment taxpayers. Individuals who wish to set up their own self-serve ‘Time to Pay’ arrangements must have no outstanding tax returns, have no other tax debts and have no other HMRC payment plans set up. The debt needs to be between £32 and £30,000 and the payment plan must be set up no later than 60 days after the due date of a debt. Interest will be applied to any outstanding balance from 1 February 2021. Time to Pay arrangements are possible for larger debts and/or deferrals of more than a year, but these must be arranged by telephone rather than via the online service.

Botswana, Eswatini, Jordan, Namibia sign OECD Multilateral Convention

The OECD has announced that four more countries - Botswana, Eswatini (formerly Swaziland), Jordan and Namibia - have signed the Multilateral Convention on Mutual Administrative Assistance in Tax Matters (the Convention), bringing the total number of jurisdictions that participate in the Convention to 141. The Convention enables jurisdictions to engage in a wide range of mutual assistance in tax matters: exchange of information on request, spontaneous exchange, automatic exchange, tax examinations abroad, simultaneous tax examinations and assistance in tax collection. The list of participating jurisdictions has been updated.

Social Security (Disregarded Payments) (Coronavirus) Regulations

The government announced that, from 28 September 2020, people on low incomes who have tested positive for COVID-19, or have been told by NHS Test and Trace to self-isolate, that cannot work from home and have lost income as a result, would be supported by a Test and Trace Support payment of £500. The Social Security Contributions (Disregarded Payments) (Coronavirus) (England) Regulations 2020 come into force on 22 October 2020. Their effect is to disregard payments made under the Test and Trace Support Payment Scheme in England so that payments under the scheme will not be liable to employer or employee Class 1 National Insurance contributions (NICs). Employers will not be liable to Class 1A NICs in respect of the payments. A Tax Information and Impact Note on the regulations has also been published.

Government responds to PAC report on management of tax reliefs

The government has responded to the recommendations contained in the Public Accounts Committee's report of July 2020 Management of Tax Reliefs. The Committee observed in its report that the full cost of tax reliefs that support government’s economic and social objectives is not known and could exceed £159 billion a year. It also considered that HM Treasury and HMRC had made unacceptably slow progress in improving their management of tax reliefs, and need to markedly improve their reporting on the cost, beneficiaries, and impact of tax reliefs. The government has accepted eight recommendations on gathering and publishing information. However, it has not accepted recommendations that HM Treasury should prepare a report setting out the results of its value for money assessments of tax reliefs in 2021, and that HMRC should, within 12 months, have evaluated the impact of pension tax reliefs.

BEPS MLI: Jordan deposits instrument of ratification

Jordan deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (BEPS multilateral convention or MLI) with the OECD on 29 September 2020. Jordan's finalised list of reservations and notifications is here. The list of countries' provisional or ratified MLI positions has been updated as at 29 September 2020.

Forthcoming Dbriefs webcast

The next Dbriefs webcast is on Thursday 8 October 2020, 13.00 BST/14.00 CEST. The title is UK Coronavirus Job Support Scheme - An Introduction To Eligibility, Required Employer Funding And Submitting Claims from our Global Mobility and Employment Taxes series, hosted by James Warwick. During the webcast our panel of experts will discuss the new UK Coronavirus Job Support Scheme following the end of the Coronavirus Job Retention Scheme (CJRS) and the potential impact on various organisations. To register for the webcast, click here.

Tax Inspectors Without Borders: annual report

Tax Inspectors Without Borders (TIWB), a joint OECD/United Nations Development Programme initiative which was launched in July 2015 to strengthen developing countries' auditing capacity and multinationals' compliance worldwide, has published its latest annual report. The TIWB initiative has 80 completed and ongoing programmes in 45 countries and jurisdictions worldwide. The report finds that the international community continues to make progress towards strengthening developing countries' ability to effectively tax multinational enterprises, despite the adverse impact of the COVID-19 pandemic.

VAT and e-commerce: Commission guidelines published

The European Commission has published explanatory notes which clarify the new VAT e-commerce rules that will come into force from 1 July 2021, and which provide practical examples for suppliers, marketplaces and platforms involved in e-commerce transactions. The notes provide further guidance on, amongst other things, the marketplace facilitation criteria and the use of simplification schemes. The Commission estimates that the new rules will generate an additional €7 billion annually, by ensuring that all e-commerce sales from outside the EU are subject to VAT. To hear more about the new rules and their implications for your business, please register for our webcast on Thursday 8 October 2020, 12.00 BST/13.00 CEST. (Contact: Jane Curran).

Trader Support Service launched

With fewer than 100 days until the end of the transition period, the government has launched the Trader Support Service (TSS), which will help traders moving goods that are affected by the Northern Ireland Protocol (including movements of goods between GB and NI) from 1 January 2021. As well as guidance, online training and webinars, the TSS will provide a free end-to-end support package to manage import, and safety and security declarations on behalf of traders. HMRC have written to businesses who might benefit from the TSS, and updated their online guidance. (Contact: Zoe Hawes).