Key tax measure dropped from US bill
The government has welcomed news that section 899 has been removed from the One Big Beautiful Bill in the United States. Section 899 provides for the introduction of retaliatory measures where a non-US person or company has links with a country that has implemented an “unfair foreign tax”, including: an undertaxed profits rule; digital services tax; or diverted profits tax. The UK has all three of these taxes.
It would appear that the US has won concessions from other nations. The G7 has confirmed that it intends to deliver a “’side-by-side’ solution under which U.S. parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing U.S. minimum tax rules to which they are subject”.
Separately, Canada, a member of the G7, has announced that it will “rescind” its digital services tax “in anticipation of a mutually beneficial comprehensive trade arrangement with the United States”.
Guidance on filing forms P11D
HMRC has reminded employers that the deadline for submitting forms P11D and P11D(b) for 2024/25 is 6 July 2025. HMRC’s guidance includes helpful tips for completing the forms and explains how to submit them. Read more about forms P11D and P11D(b) in this recent article from ICAEW.
Cost contribution arrangements and transfer pricing
In March 2025, the government announced that it intended to offer clearance on the tax treatment of cost contribution arrangements (CCAs) through advance pricing agreements (APAs). HMRC has now published guidance that explains how it will operate the CCA APA programme, including a sample agreement.
Paper 2024/25 tax returns
HMRC has updated the documents which set out whether a tax return should be filed on paper rather on online for:
HMRC says that, although the documents are produced for software developers, it understands that some tax agents find them useful when dealing with clients with complicated tax affairs.
Lump sum reporting
HMRC has published guidance that sets out how to report pension commencement excess lump sums (PCELS) and stand-alone lump sums (SALS) for 2025/26. It also provides links to guidance on reporting for 2024/25 and on how to correct an error.
Employers’ PAYE and disputed charges
HMRC has said that it will introduce an online form to enable employers to report disputes on their pay as you earn (PAYE) liabilities. Currently, employers can call HMRC’s employer’s helpline on 0300 200 3200 or write to HMRC at:
PT Operations North East England
HM Revenue and Customs
BX9 1BX
United Kingdom
Further information will be provided in due course.
Other international tax news
CFE Tax Advisers Europe has published its latest collection of tax top 5 developments, including a summary of the OECD’s report on how tax administrations are advancing digital reform. Key points include that over 70% of administrations are using AI.
Tax Faculty
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