September 2021 tax deadlines you should be aware of

September 2021 tax deadlines include a couple of extra areas to bear in mind this year that you may not be aware of, one resulting from the end of the 5% VAT rate for the hospitality industry and the other concerning claiming refunds for settlement agreements resulting from certain loan charge arrangements.

30 September 2021 tax deadlines – Loan Charge settlement agreement refund

Following the Loan Charge review in December 2019 (The Morse Review), HMRC accepted several changes to Loan Charge settlement arrangements. This included that under certain circumstances, taxpayers who entered into a settlement agreement with HMRC and were not liable to the Loan Charge are entitled to a refund.

Importantly, the deadline for claiming a Loan Charge refund is 30 September 2021.
 
The conditions for claiming a refund ahead of the September 2021 tax deadlines are as follows:

  • Where arrangements were entered into before 10 December 2010 and HMRC failed in protecting its position, for example if HMRC didn’t open an enquiry or raise an assessment and invited taxpayers to settle on a voluntary basis.
  • Where arrangements were entered in to between 10 December 2010 to 5 April 2016 and the taxpayer made a ‘reasonable disclosure’ and HMRC also failed to protect its position.

Whilst we understand that HMRC has already contacted those entitled to a refund, it has reported that only a small proportion of refunds have so far been processed.

Claims need to be lodged with HMRC by 30 September 2021. We recommend that all taxpayers should check if they are entitled to claim refund and where appropriate, take professional advice and subsequently lodge a claim.

End of the 5% VAT rate for the hospitality Industry

In June 2020 the Government introduced a temporary reduction in VAT for the hospitality industry to 5%. This ends on 30 September, when it increases to a 12.5% transitional rate. This will then apply until it reverts to the standard VAT rate of 20% on 1 April 2022.

As no anti-forestalling legislation applies to this VAT change, there is an opportunity to make VAT savings for advanced purchases, as for any payments received by 30 September the 5% VAT rate will apply (and subsequently the 12.5% rate for advance purchases after this date, but ahead on 1 April 2022).

Alexander & Co – comprehensive tax advice

Alexander & Co offers one of the most comprehensive and robust tax services in the region. The team has a wide range of expertise covering both corporate and personal tax.

We are a boutique firm that encompasses the expertise and experience of the Big Four firms, with the added assurance of a personal, hands-on approach. This approach ensures partners and senior staff members remain available to clients and our expertise provides a comprehensive service, with full in-house capabilities, including specialist property advice, inheritance tax and estate planning, research and development and capital allowances advice.

Our specialist tax services also include mergers, acquisitions and company reorganisations, where we are particularly well regarded.

Please contact us to discuss how we can assist you, using the form below, or alternatively callus on 0161 832 4841 or email info@alexander.co.uk

Further information relating to this article can be found here:

Personal Tax advice

Corporate Tax advice

VAT Services

Government confirms changes to loan charge policy and implementation

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