President Trump and Republican lawmakers currently are considering a second round of tax reform legislation as a follow-up to last year’s Tax Cuts and Jobs Act (TCJA). House Ways and Means Committee Chair Kevin Brady (R-TX) just released a broad outline, or framework, of what the tax package may contain. And while this offers a glimpse of what might happen, as we learned with the TCJA there will be many changes along the way before passing final legislation.

Proposed Framework

One of the main themes of the proposed legislation is to make permanent certain provisions in the TCJA, including:

  • Federal income tax rate cuts for individual taxpayers,
  • The doubled child tax credit, and
  • The deduction for up to 20% of qualified business income (QBI) from pass-through entities (sole proprietorships, partnerships, LLCs and S corporations).

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Author: Wayne K. Berkowitz CPA, J.D., LL.M.

Rightfully so, we have all been occupied with the U.S. Supreme Court decision in Wayfair, but that doesn’t mean we should forget about the basics of sales tax planning. As has always been the case, a simple change in a transaction’s structure or the check of a box (or not) can either be a big money saver or a huge unexpected cost.

Read more: Sales Tax Slip-Ups; Back to Basics in the Age of Wayfair

Author: Richard Collier

Unfortunately, yes. Tax continues to be a challenge for the charity sector, and VAT is no exception. The VAT regime can be a mixed experience for charities. There are beneficial rules on advertising spend (potentially zero-rated), fund raising events (exempt if qualifying) & sales of donated goods (zero-rated) amongst others, but significant challenges remain.

Read more: Tax on charities – surely not?

Rural businesses which run furnished holiday lets or livery stables could now benefit from Inheritance Tax relief following two favourable court cases.

Previously, neither holiday lets or DIY liveries qualified for Business Property Relief (BPR), as HMRC views them as investment activities rather than trading businesses. But the two court cases – which were won by the taxpayers – could be turning that on its head, explains Catherine Vickery, tax consultant at Old Mill accountants.

“There has been a raft of cases in the past few years where the taxpayer has lost out on this issue – perhaps there is now a change of tide against HMRC? It doesn’t mean that all liveries and holiday lets will qualify for BPR but it seems there are things you can do to increase your chances of success.”

Read more: Courts ease tax relief bindings for rural businesses

There is broad agreement between global Tax Authorities that the means by which companies in the digital sector can be subject to corporate tax in overseas territories has not kept pace with the manner in which many multinationals today generate profits across multiple locations.

Specifically, current international rules make it difficult to apply tax on companies which generate income from customers in a particular territory, but without any need for employees or premises to be in that location. Current tax principles generally require some form of physical presence overseas to enable the Authorities to pin a corporate tax liability onto the entity.

Read more: Taxation of the Digital Economy – Changes are Coming