The CIOT has published a number of proposals for consideration ahead of the 27 October 2021 Budget covering the following:
On employment taxes and pensions, the CIOT suggests:
The CIOT is concerned about individuals who have entered into arrangements that are subject to the loan charge and are now being asked to repay the loan by organisations which claim to own or control the loans. It recommends that the government considers introducing legislation to prevent assignment and/or enforcement of these loans by including a 100% tax charge on any proceeds or profits arising from such activities, the imposition of penalties on assignors/assignees, or (looking beyond simply tax measures) legislating to make such loans unenforceable as contrary to public policy.
The CIOT also recommends that the government consider an early high-level consultation on the implications of remote working abroad, covering:
The CIOT also repeats a request made last month (see Tax Journal, 24 September) for the government to review the taxation of employee ownership trusts (EOTs) to encourage take-up and discourage their abuse.
Pete Miller, chair of the CIOT’s Owner Managed Business Committee, said that there was clear support for the EOT tax regime but ‘removing unnecessary costs from the process of transferring a company into employee ownership should be a priority’.
‘We are also concerned that some advisers seem to be recommending EOTs as a tax planning measure without any real commitment to employee engagement, he said.
‘In particular, we have heard of advisors recommending EOTs simply as an interim tax-saving step where the intention is, in the relatively short term afterwards, to sell off or float the company. This suggests a lack of genuine commitment to employee engagement,’ Miller said. ‘We think it is worth exploring ways to guard against this outcome and the consequent loss of tax revenue. One option would be to require EOTs to be resident in the UK as a condition of accessing the favourable tax treatment.’
The CIOT has published a number of proposals for consideration ahead of the 27 October 2021 Budget covering the following:
On employment taxes and pensions, the CIOT suggests:
The CIOT is concerned about individuals who have entered into arrangements that are subject to the loan charge and are now being asked to repay the loan by organisations which claim to own or control the loans. It recommends that the government considers introducing legislation to prevent assignment and/or enforcement of these loans by including a 100% tax charge on any proceeds or profits arising from such activities, the imposition of penalties on assignors/assignees, or (looking beyond simply tax measures) legislating to make such loans unenforceable as contrary to public policy.
The CIOT also recommends that the government consider an early high-level consultation on the implications of remote working abroad, covering:
The CIOT also repeats a request made last month (see Tax Journal, 24 September) for the government to review the taxation of employee ownership trusts (EOTs) to encourage take-up and discourage their abuse.
Pete Miller, chair of the CIOT’s Owner Managed Business Committee, said that there was clear support for the EOT tax regime but ‘removing unnecessary costs from the process of transferring a company into employee ownership should be a priority’.
‘We are also concerned that some advisers seem to be recommending EOTs as a tax planning measure without any real commitment to employee engagement, he said.
‘In particular, we have heard of advisors recommending EOTs simply as an interim tax-saving step where the intention is, in the relatively short term afterwards, to sell off or float the company. This suggests a lack of genuine commitment to employee engagement,’ Miller said. ‘We think it is worth exploring ways to guard against this outcome and the consequent loss of tax revenue. One option would be to require EOTs to be resident in the UK as a condition of accessing the favourable tax treatment.’