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CTG NEWSLETTER - 19 NOVEMBER 2021
This week's newsletter includes details of the Finance Bill and a newly announced Tax Administration and Maintenance Day, which will take place on 30 November. We would also draw your attention to the recording of the recent Expert Insight Session on the future of the tax system which was a really fascinating session. You can also register for forthcoming events on payroll giving and tax issues for small charities.

We apologise to members for any issues they have encountered in receiving the newsletter - our Mailchimp account has now been "authenticated" as well as "verified" so we hope that any previous issues will be resolved soon!
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EXPERT INSIGHTS
FUTURE OF THE TAX SYSTEM
In this session Pierre Arman and Carolyn Norfolk from EY explored the tax administration trends emerging globally and a look forward as to how technology could shape tax functions in the future. If you missed the session you can watch a recording of this fascinating session here and access the slides here. Please share with colleagues across the finance function.
FUTURE SESSIONS
The next session in the Expert Insight series will focus on tax issues relevant to smaller charities. Joining CTG Chair, Richard Bray, will be Alexandra Gear (CTG Director and Director of Finance Operations at the MS Trust), Les Howard (VAT consultant at vatadvice.org) and hopefully a representative of the Small Charities Coalition. This session will take place on either 1 or 2 December 2021 (the finalised date will be confirmed ASAP), from 4pm for an hour, and you can express your interest in attending by completing this form or contacting info@charitytaxgroup.org.uk.

On 18 January 2022, speakers from the charities Cancer Research UK, Barnardo's and Together for Animals will talk about the value of Payroll Giving for their charities and the steps that are needed to increase take-up across the sector. Further details will follow shortly, but you can express your interest in attending by completing this form or contacting info@charitytaxgroup.org.uk.
PREVIOUS SESSIONS
Slides and recordings of Expert Insight sessions on VAT developments, Making Tax Digital for VAT, Employment taxation, Business Rates, Brexit, Tackling the Gift Aid Gap, and Budget 2021 can be found here.
ROUND UP OF TOPICAL DEVELOPMENTS
TAX ADMINISTRATION AND MAINTENANCE DAY
The Government has announced that there will be a Tax Administration and Maintenance day on 30 November 2021. A number of documents will be published, including consultations for announcements made at Autumn Budget and Spending Review 2021, summaries of responses to recently closed consultations and technical information notices.

None of the announcements will require legislation in the Finance Bill, and the day will follow a similar format to March 2021’s Tax Policies and Consultations Update

FINANCE BILL 2021-22
The Finance Bill 2021-22 has been published, legislating for tax changes announced by the Chancellor at last week’s Budget. This includes the extension of tax reliefs for museums, galleries, theatres and orchestras to 31 March 2024. The Bill passed second reading on 16 November 2021. You can read the full contents of the Finance Bill 2021-22 and also the Bill’s explanatory notes which includes details of the measures including their implementation dates.
HMRC PERFORMANCE IN 2020-21
The Public Accounts Committee The Committee will hold its annual evidence hearing with senior HMRC officials on the overall position of UK tax revenues and how HMRC manages the taxation ‘tools’ at its disposal to achieve policy ends; the ‘tax gap’ of taxes owed which are not collected through error, avoidance or evasion; the administration of Covid support schemes through HMRC in this year of unprecedented public spending and potential losses to error and fraud in those schemes; and the longstanding issue of debt owed to HMRC and how it is being recovered. Submissions are requested by 24 November 2021.
CAMBRIDGE UNIVERSITY BOATHOUSE VAT CASE
Cambridge University Boathouse Ltd (CUBL) built a boathouse at Ely for £5m which it licenses to the university’s three elite rowing clubs, whose stated goal is to beat Oxford in the boat race each year. The construction was funded through donations and loans, with the licence fee generating just enough revenue to cover the boathouse’s maintenance and utilities costs. HMRC denied input tax recovery on the construction, on the basis that the licence fell within the sporting exemption. The FTT has ruled, however, that the license was granted to the clubs and not to the individual rowers who were members of the clubs. For example, CUBL provided storage for the expensive boats that belonged to the clubs, but rowers were not allowed to store their own kit or equipment there. The sporting exemption only applied if the “true beneficiaries” of CUBL’s supply were the rowers. The FTT held that CUBL had granted rights to the clubs and not to the rowers, and therefore its supply was not exempt under the sporting exemption, and CUBL was not barred from recovering input tax on that basis. We are grateful to Nick Comer at Deloitte for allowing this case report to be shared with CTG members.
GOVERNMENT PREPAREDNESS FOR THE PANDEMIC
A new National Audit Office (NAO) report finds that government was not fully prepared for the wide-ranging impacts of the COVID-19 pandemic. The report finds, among other things, that the Government lacked detailed plans for employment support schemes.
MANAGING TAX DEBT DURING THE PANDEMIC
A new report by the NAO considers how well HMRC has managed tax debt through the pandemic – in particular, whether it has adapted sufficiently to the changing nature and scale of that debt and the wider circumstances that affect taxpayers’ ability to repay tax. the report concludes that It argues that HMRC does not have the resources to deal with the ongoing fall out of the pandemic and needs to adapt to face the challenge.

Responding separately to the publication of HMRC accounts for 2020-21, Gareth Davies, Head of the NAO said“The COVID-19 pandemic has significantly reduced tax revenues and made it more difficult for HMRC to take enforcement action. Now that the initial impact of the pandemic has eased, normal tax compliance levels should be restored. HMRC also needs to recover money paid out through fraudulent claims made under the COVID-19 support schemes.”
CHECK IF YOU ARE AT RISK OF TAX AVOIDANCE
HMRC has published guidance on how to check your risk of being involved in tax avoidance if you're an agency worker or contractor working through an umbrella company. It may be useful for charities to advertise this tool to any contractors in this position, but the website does note: "This interactive risk checker only covers the most common signs of tax avoidance to look out for".
TAX CHANGES TO TACKLE CLIMATE CHANGE?

The House of Lords Environment and Climate Change Committee is seeking written submissions for its inquiry into behaviour change in the context of climate change (mitigation and adaptation) and the environment (e.g. biodiversity, water, waste and the circular economy, and air pollution) by Monday 13 December 2021.

The main focus of the inquiry is on behaviour change, though not in isolation, as the Committee is also interested in the wider conditions needed for people to make changes and the sequencing of related policy measures.

One question asks: "How should the Government consider the balance between... encouraging changes to individual behaviour; regulatory approaches...; and fiscal measures (including taxation)?"

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