Finance Bill 2016 – Corporate Tax, IP and Partnerships

 Corporate Tax, IP Tax  Comments Off on Finance Bill 2016 – Corporate Tax, IP and Partnerships
Jan 272016
 

In the last two Budgets, the Government did a lot of heavy tinkering with the rules on goodwill related intangibles. In the first Budget of 2015, they stopped tax relief when a company acquired such assets from a related party, and in the second, Summer Budget of 2015, they extended this treatment to unrelated parties. One would have expected the Big Bad Wolf to be satiated by now, but it seems not – Autumn Statement 2015 has given us yet another set of restrictions on intangibles related tax relief.

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Budget 2015 Entrepreneurs’ Relief – New Rules on Joint Ventures and Partnerships

 CGT, Corporate Tax  Comments Off on Budget 2015 Entrepreneurs’ Relief – New Rules on Joint Ventures and Partnerships
Mar 302015
 

This year’s Budget has not been very kind to entrepreneurs’ relief, the 10% tax rate that applies when an individual sells a business. We’ve already seen in last year’s Autumn Statement, the introduction of rules to restrict the relief when a business incorporates. This year’s Budget saw two more measures aimed at people intending to access the relief when they shouldn’t be.

In this article we shall look at the new rule on joint ventures and partnerships. What was the law before the Budget, what is the law now, and why was the law changed? Continue reading »

Jan 182015
 

Updated January 2016

In the case of Drilling Global Consultant LLP v HMRC, a limited liability partnership (“LLP”) was denied the annual investment allowance on upgrading an aircraft on the basis that its members weren’t all individuals. The result is a straightforward application of the capital allowances legislation. However, the arguments put forward by the LLP are of some interest, as well as being totally wrong.

(This article can be downloaded in pdf format at Academia.edu.)

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Partnership Consultation – Profit Allocation Schemes to close

 Partnership Tax  Comments Off on Partnership Consultation – Profit Allocation Schemes to close
Jul 012013
 

HMRC published its Consultation Paper on partnerships a few weeks ago. In Part One, we looked at the proposals concerning disguised employment. In this part, we shall look at profit allocation schemes and what the Government is intending to do about them. Continue reading »

Partnerships and Disguised Employment – turning business owners into employees

 Partnership Tax  Comments Off on Partnerships and Disguised Employment – turning business owners into employees
Jun 042013
 

HMRC has published its Consultation Paper on partnerships, which can be found at the GOV.UK website. There are two areas being targeted:

  • Disguised employment – relating to limited liability partnerships or LLPs only. Partners who are in substance employees, will be treated as employees – leading to a potentially higher tax bills for both “employee” and the LLP;
  • Profit and loss allocation schemes – where profits and losses can be shifted between various members of the partnership to minimise the overall tax burden. It is proposed to stop this from happening.

In this article we shall look at the proposed new rules for disguised employment. Profit and loss allocation schemes will be discussed in a later article. Continue reading »

Incorporating Goodwill – Can you claim tax relief when you become a company?

 Corporate Tax, IP Tax  Comments Off on Incorporating Goodwill – Can you claim tax relief when you become a company?
May 052013
 

One of the key tax issues when a sole trader or partnership incorporates an existing business is the treatment of goodwill. In particular, can the new company claim tax relief for writing down the goodwill after acquiring the business?

This should be possible for those who started business recently – by which we mean, those businesses set up from 1 April 2002 onwards. But if your business is more established, then we have a problem…

UPDATE From 3 December 2014 it is no longer possible to claim tax relief for internally generated goodwill in line with the accounts when incorporating a business. This is due to the announcement in the Autumn Statement of 2014 restricting deductions for goodwill when a close company acquires a business from an individual or partnership, and the company is related to the seller(s). 

However, the following article is still relevant to the question of when a person becomes entitled to shares in a company that are to be issued to him under a contract.

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