20 November

Tax Updates- November 2020

AIA, Digital Signature CGT, Self Employed Grant

Claim & Activity Based School Holiday Cubs VAT

AIA limit to remain at £1m until 1 January 2022

The UK government is extending the £1m annual investment allowance cap for a further year in a bid to stimulate investment. The annual investment allowance (AIA) had been due to revert to £200,000 on 1 January 2021 following a two-year period of being raised to £1m.

*The AIA is available for expenditure on most plant and machinery, the primary exception being expenditure on cars.

Digital signatures for CGT relief

HMRC has updated its guidance on capital gains tax (CGT) relief on gifts and similar transactions confirming that it will accept digital signatures on the claim for hold-over relief form. The form needs to be signed by the transferor and the transferee, however, in light of measures to stop the spread of coronavirus HMRC has confirmed it will accept digital signatures until further notice.

Check updated Guidance

https://www.gov.uk/government/publications/relief-for-gifts-and-similar-transactions-hs295-self-assessment-helpsheet/hs295-relief-for-gifts-and-similar-transactions-2020#how-hold-over-relief-works

Respond to SEISS trading cessation emails by 20 November

SEISS claimants who have received an email from HMRC querying whether they have continued to trade need to respond by 20 November or they will not be eligible for a further claim.

In October 2020, HMRC emailed approximately 24,000 Self-employment Income Support Scheme (SEISS) claimants where it held information suggesting that the taxpayer had ceased trading. Recipients of this email need to respond by Friday 20 November, using the dedicated HMRC form, and if they do not do so they will not be able to make a further claim under the scheme.

Activity-based school holiday clubs exempt from VAT

HMRC has clarified its policy on the VAT liability of “activity-based” school holiday clubs following a First Tier Tribunal (FTT) decision that such clubs fall within the welfare exemption.

In RSR Sports Limited (Decision No TC07453), the FTT ruled the activities offered by RSR in its school holiday camps were an adjunct to the essential service which was childcare. The FTT also distinguished the case from Sports Academies (Decision No TC05171) in that the staff held no coaching or teaching qualifications and were merely overseeing activities.

Check Updated Guidance

https://www.gov.uk/government/publications/revenue-and-customs-brief-18-2020-vat-liability-of-school-holiday-clubs-first-tier-tribunal-decision/revenue-and-customs-brief-18-2020-vat-liability-of-school-holiday-clubs-first-tier-tribunal-decision#the-ftts-decision-and-hmrcs-revised-policy

Accreditations