Highlights from the broader tax news week ending 26 October, which includes: new legislation for the health and social care levy and simplifying inheritance tax rules. A deadline reminder for final CJRS claims, more agent webinars from HMRC and confirmation that HGV drivers on temporary visas are not entitled to tax relief on accommodation.
Health and Social Care Levy Act 2021 receives Royal Assent
The Health and Social Care Levy Act 2021, legislating for a temporary one-year 1.25% increase in Classes 1, 1A, 1B and 4 national insurance contributions (NIC) from 6 April 2022 and a new health and social care levy which extends to those over state pension age from 6 April 2023 received Royal Assent on 20 October 2021. The related 1.25% increase in dividend tax rates from 6 April 2022 will be legislated for in the next Finance Bill. Further details: PM confirms increase to NIC and dividend tax rates.
Deadline for September CJRS underclaims
Employers who made a mistake in their coronavirus job retention scheme claim for September 2021 that means they received too little money must amend their claim by Thursday 28 October. While HMRC has agreed with the professional bodies including ICAEW that off-sets are possible where there has been an overclaim and an underclaim in the same claim period, where the net result is an underclaim, this 28-day deadline applies. Read more.
Legislation simplifying IHT rules laid
On 21 October 2021, the Inheritance Tax (Delivery of Accounts) (Excepted Estates) (Amendment) Regulations 2021 (SI 1167/2021), were laid before the House of Commons and will come into force on 1 January 2022. The regulations deliver a simplification to inheritance tax (IHT) rules announced on Tax Day in March. The amendment will ensure that more than 90% of non-taxpaying estates will no longer have to complete IHT forms when probate or confirmation is required. ICAEW’s Tax Faculty is providing a detailed look at the changes in the December issue of TAXline.
No tax relief on accommodation for HGV drivers on temporary visas
Following the government’s announcement of 4,700 additional temporary visas for HGV drivers to transport foodstuffs, HMRC has provided clarification on whether such workers would be entitled to tax relief on living accommodation under the existing temporary workplace rules. HMRC has reaffirmed that the usual rules will apply and no reliefs will be available. HMRC cites s339 of the Income Tax (Earnings and Pensions) Act (ITEPA) 2003, stating that as these workers will be attending their UK workplace for a continuous period during the three to six months that they will be working in the UK, the UK workplace is considered permanent and the 24-month rule is overridden. If the accommodation provided does not constitute living accommodation, says HMRC, then the provision will be caught by s201 of ITEPA instead. Further information is available in EIM32125 and EIM11321.
More HMRC webinars to support agents
HMRC is ramping up their live webinar offering for tax agents, known as “Talking Points”, opening registration for a host of hour-long webinars in November. Alongside support on the new plastic packaging tax and the risks of working with umbrella companies, agents can sign up for webinars on Making Tax Digital for VAT, capital allowances and vehicles, and trade losses. HMRC is also hosting a two-part webinar on income from property for individual landlords, with the first half focused on restricting finance cost relief and cash basis eligibility. The second instalment meanwhile will tackle main expenses and deductions.
This guidance is created by the Tax Faculty, recognised internationally as a leading authority and source of expertise on taxation. The Faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.