Tax news in brief
Highlights from the broader tax news week ending 22 December, which includes: guidance from HMRC on disguised remuneration schemes that avoid tax by selling business revenues to trusts, changes to land transaction tax, Royal Assent of the Taxation (Post-transition Period) Bill 2020 and OECD guidance on transfer pricing implications of the COVID-19 pandemic.
Disguised remuneration: Spotlight on tax avoidance by selling revenues to trusts
HMRC has published guidance specifically looking at tax avoidance arrangements where businesses sell future revenues to a trust to avoid paying tax and national insurance contributions. The guidance outlines the claims made by those offering such arrangements, as well as why taxpayers should not use them. Read the guidance in Spotlight 57.
Changes to land transaction tax (LTT) announced in Welsh draft budget
The draft Budget on 21 December announced a 1% increase in the higher residential rates of LTT and changes to non-residential rates and bands that will apply from 22 December 2020. The Welsh Government also confirmed that the temporary increase to the nil rate band of LTT for residential property transactions will end on 31 March 2021. Find out more.
Taxation (Post-transition Period) Act 2020
The Taxation (Post-transition Period) Bill 2020 received Royal Assent on 17 December 2020. Find out more.
OECD guidance on the transfer pricing implications of the COVID-19 pandemic
On 18 December, the OECD released a 31-page document setting out transfer pricing guidance recognising the practical challenges the pandemic has presented. It focuses on four priority issues all relating to an application of the arm's length principle comparability analysis, losses and the allocation of COVID-19 specific costs, government assistance programmes and advance pricing agreements. Read the guidance.