Meet the Co-chairs - TIAG
Mercer & Hole
Cohen & Company (Ohio)
Fineman West & Co. LLP
Meet the Co-chairs - TAGLAW
Williams Mullen (VA)
Author: Raj Seewooruttun
HMRC introduced new legislation in the Finance (No. 2) Act 2017 requiring those with undeclared offshore tax liabilities (Income, Capital Gains or Inheritance Taxes) to disclose the liabilities to HMRC. This has to be done on or before 30 September 2018 (and tax needs to be settled).
30 September 2018 is the final date for the disclosure and this coincides with the date more than 100 countries will exchange data on financial accounts under the Common Reporting Standard. In theory, HMRC’s ability to identify offshore non-compliance should increase very significantly and therefore, all taxpayers should take this opportunity to ensure that their affairs are in order before the deadline passes.
Failure to report any relevant information on or before 30 September 2018 means the taxpayer would be subject to the new ‘Failure to Correct’ penalty regime, which is much harsher than the normal penalty regime, with a minimum penalty of 100% of the tax unpaid! The Requirement to Correct (“RTC”) legislation can also be applied in respect to periods prior to 6 April 2017.
After two full Budgets in 2017, this Spring Statement was a less dramatic affair, with no announcements of tax changes. These will come in the Autumn Budget.
The Chancellor launched a number of consultations and other papers about future proposals. The subjects ranged from ways to squeeze more tax from international digital businesses to a proposal for extending entrepreneurs’ relief to some shareholders whose holdings drop below the qualifying 5% level. He has also been mulling the possibility of lowering the VAT threshold.
Last week’s Spring Statement may not have been full of headlines, but there are plenty of changes ahead for farmers and rural businesses, according to accountant Old Mill.
“Whether it’s a reduction in business rates, taxes on red diesel, relaxed planning permission regulations or tightening of Inheritance Tax relief, there is potentially a lot in the pipeline,” says Victoria Paley, manager at Old Mill.
On February 27th Finance Minister Bill Moreneau presented the 2018 Federal Budget titled “Equality and Growth”. The budget includes a focus on growing government revenues by increasing economic participation among women, visible minority Canadians and persons with disabilities, as well as substantial long-term investments in science and technology. The government suggests that increasing equality for women and enhancing women’s participation in the workplace (especially in technology and trades) could add $150 billion to the Canadian economy over the next decade.
As you may be aware, the US Government passed significant tax reforms in late 2017, and one of the major reforms was the wholesale conversion of its system of taxing corporate business income from a worldwide taxation system to a territorial taxation system. Under the old worldwide taxation system, business profits earned in a foreign subsidiary and repatriated to a US parent corporation were taxable in the US, with credit being provided for the foreign taxes paid by the foreign subsidiary. This meant that business profits earned in a lower tax jurisdiction would be subject to a “top-up” tax on repatriation to the US. Under the new territorial taxation system, business profits earned in a foreign subsidiary may be repatriated to the US without additional US income tax being applied.