Highlights from the broader tax news for the week ending 14 December 2022, including: a change for HMRC’s Agent Team; a transitional period for applying the domestic reverse charge to relevant supplies of scaffolding; the Welsh draft budget for 2023-24; the latest Employer Bulletin from HMRC; EU agreement on pillar 2; and expansion of the investment management exemption.
Agent Maintainer Team
HMRC’s Agent Maintainer Team is now part of its Customer Compliance Group.
If you need to correspond with the team, please write to the new address below:
Agent Compliance Team
HM Revenue & Customs
VAT on scaffolding - transitional period
Having confirmed its position in November on the VAT liability of scaffolding, HMRC has now announced that there will be a transitional period for businesses to implement the new policy.
Until 1 February 2023, businesses can use either reverse charge accounting or normal VAT rules for relevant supplies of scaffolding.
Businesses do not need to adjust, as a result of the change in policy, the VAT accounting of relevant supplies made before this date.
Welsh draft budget 2023-24
The Welsh draft budget for 2023-24 was published on 13 December.
The Welsh government proposes to maintain parity with income tax rates in England by setting the Welsh rate of income tax (WRIT) for 2023-24 at 10p. WRIT works by reducing each of the three income tax rates for Welsh taxpayers by 10p. The Welsh government then decides whether to set WRIT at 10p or at a different rate.
Land transaction tax rates remain unchanged from those that came into effect on 10 October.
Subject to approval by the Senedd, landfill disposal tax rates for 2023-24 will be: £102.10 per tonne (standard rate); £3.25 per tonne (lower rate); and £153.15 (unauthorised disposals rate).
The Welsh government also proposes to continue providing support for those sectors most directly affected by the pandemic through a 2023-24 retail, leisure and hospitality rates relief
scheme. In addition, the non-domestic rates multiplier in Wales will be frozen in 2023-24. Transitional relief will also be available to those ratepayers whose liability is increasing by more than £300 as a consequence of the 1 April 2023 revaluation.
Employer Bulletin: December 2022 includes a reminder to make sure PAYE liabilities payable in January 2023 clear into HMRC’s bank account on or before 20 January as the 22 January electronic payment deadline is a Sunday. Employers using HMRC’s variable direct debit facility should note that HMRC’s employer liabilities and payments account shows interest charges between the normal due date of 22nd until the direct debit payment is collected, at which time the interest charge is reversed and cancelled.
Council of the EU reaches agreement on pillar 2
EU member states have reached agreement to implement at EU level the minimum taxation component, known as pillar 2, of the OECD’s reform of international taxation. The directive must be transposed into member states’ national law by the end of 2023. Read more.
Expansion of the investment management exemption to include cryptoassets
HMRC has published the outcome of its consultation into the expansion of the investment management exemption (IME) to include cryptoassets. The summary includes findings regarding definitional aspects and possible exclusions from the IME in relation to certain UK activities involving cryptoassets. HMRC has shared draft regulations with consultation respondents and plans to introduce the regulations by the end of 2022.
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.