Delegates came to London’s Code Node for The Angle 2022 - Markel Tax’s thought-leadership event - to hear how a changing tax environment has created new challenges for accountants up and down the country.
Published on 20 October, 2022
distinctive red branding, added to the modern interior, created an ‘edgy’ feel
for the event, reflecting current concerns around uncertainty in the UK’s
Brodie, director of Markel Tax, kicked off proceedings by saying how delighted
he was to have everyone back together in a room to discuss some of the key tax
issues of the day. He made light of the fact that, due to recent government
events, it had been difficult to plan for the day but also acknowledged that
the U-turns have created a challenged situation for everyone - hitting home the
pertinence of events like The Angle.
introduced associate director, David Harmer, to discuss IR35, one of the areas
most affected by the government’s recent change of course.
David Harmer – Associate Director at
10 reinstated, David’s view was that the pressure for end clients to respond
and make decisions about contractor status would now increase. ‘End clients’
currently include all public bodies and larger companies, but the changing
political and economic landscape could eventually mean that smaller companies
will also come under this banner, according to David.
covered the current IR35 legislative environment, including the obligations of
all parties in the chain and the three determinants of status: substitution,
control and mutuality. The CEST peculiarities were also discussed: how HMRC’s
own assessment tool does not provide an accurate assessment of status and how
several organisations have faced large tax bills after relying on it, including
government departments to the tune of £120m! David closed by touching on some
of the changes we might see in 2023, including an increase in chapter 10
policing as well as greater scrutiny of MSCs, self-employed status and umbrella
Next up was
John Lewis to cover the often-thorny issue of tax investigations.
John Lewis – Senior Tax Consultant at
John was an
HMRC inspector before joining Markel Tax 18 months ago. His view that there are
fewer enquiries than pre-March 2020, was reinforced by a show of hands in the
room confirming that only three of the audience had a client currently going
through an investigation. However, HMRC’s tactics have shifted by the more
psychological use of ‘nudge’ letters. Nudge letters can target a wider
population, represent minimal cost and put the onus on recipients and their
accountants to respond.
of ‘careless penalties’ was also addressed with confirmation that HMRC are more
reluctant than ever to suspend this type of fine in a material shift that would
affect the clients of many of those in the room.
having the advantage of seeing alternative dispute resolution (ADR) from both
sides of the desk, he has noted a shift in HMRC’s position where the previous
ability to resolve matters within a more open forum before going to the
tribunal stage has been watered down. Administratively, 1 June 2022, saw
several changes – including the ability to now take session notes out of the
room – although HMRC are seemingly not yet ready to release full details of the
changes within their guidance and factsheets.
brief break for refreshments, Adam Ellerington took the stage to talk R&D
Adam Ellerington - Senior R&D Tax
Manager at Markel Tax
that new legislation from 1 April 2023 is still in draft form. However, a
number of changes are anticipated – one positive, two less so.
definition of ‘software’ will now include data and cloud computing costs.
However, the revenue will be refocusing relief towards the UK, thereby largely
excluding costs associated with using overseas contractors. Thirdly, there are
significant administrative changes with applicants now required to submit
supporting documentation that has been signed off by a senior officer in the
generally, HMRC are becoming more stringent towards the issue of R&D claims
having seen this incredibly useful form of relief somewhat abused over the last
few years by the use of aggressive marketing tactics and spurious claims.
– Associate Partner at Claritas Tax
Last to present
was Sam Hart of Claritas Tax who expertly covered the subject of trusts and how
they can be used to manage tax liability in great detail for the audience.
closed with Stuart Brodie facilitating a panel session with each presenter
being asked a series of challenging questions.
opportunity to network followed what everyone agreed were hugely successful and
informative sessions with some of the industry’s most experienced practitioners
providing their views on many of the hot tax topics of today.
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