Established in 2010, KPMG's Tax Director Forum brings together tax professionals working in industry from across Scotland.
With an agenda, driven by its members, the Forum meets three times per year, focussing on topical matters affecting the modern tax department. KPMG's leading specialists are fully involved to ensure the Forum is receiving up-to-date and practical insight on any given topic and are available to discuss matters affecting specific members.
Moreover, with each event concluded with drinks and canapés, the Tax Director Forum provides an opportunity for Scotland's in-house tax community to meet regularly and establish networks.
UK Chancellor's Budget 2012 NEW
Visit KPMG’s dedicated Budget website to download our comprehensive analysis and find out what the Budget could mean for you.
If you missed KPMG's Budget 2012 WebEx briefing on 22 March 2012 or you would like to refer back to the presentation, you can watch the recording here.
Alternatively, you can download the slide pack here for future reference.
Consultation on an 'above the line' credit for Research and Development (R&D) NEW
On 27 March 2012, HM Treasury published its consultation document on the ‘above the line’ (“ATL”) credit for Research & Development expenditure, which can be accessed here. The document articulates some basic principles that an ATL credit would be expected to meet, suggests two alternative models, and poses a large number of questions. The consultation period is scheduled to end on 29 June 2012, with draft legislation for the 2013 Finance Bill intended to be published with the 2012 Autumn Statement.
A fundamental feature of the proposed ATL regime, that is apparent from the consultation document, is that the new regime is intended to apply for claims made from 1 April 2013 rather than to expenditure incurred from that date. If the current two year time limit for making a claim is maintained, it would seem that ATL claims can potentially be made on expenditure incurred in accounting periods ending as far back as 2 April 2011 – i.e. expenditure incurred as far back as April 2010. If carried through, this could mean that R&D claims become much more attractive for loss making, large companies on current and recent R&D expenditure.
Key points to note from the consultation document are:
- The ATL credit will be paid at a grossed-up rate and will be taxable.
- The level of the ATL credit would be at least 9.1%, but this may increase, dependent on the answers to certain questions posed in the consultation.
- The consultation document envisages the possibility of the ATL being beneficial to foreign owned companies that are not currently claiming UK R&D tax relief because of DTR reasons, and seeks input as to whether this would be the case.
- The ATL would either stand in place of the large company scheme, or possibly run alongside it. The SME R&D regime would be unaffected, but where an SME was required to claim under the large company scheme rules (for example on subsidised R&D) it could access the ATL credit.
Our advice is that loss making companies undertaking R&D, which have not previously made R&D Tax Relief claims, should consider preparing a claim for accounting periods where the two year claims window will end on or after April 2013. Preparing claims and capturing the qualifying data should be undertaken as soon after the R&D has been undertaken as practicable. All companies potentially affected by the ATL regime should review the consultation document and feed in any comments to HMRC / Treasury directly or via KPMG who will be collating comments on behalf of clients.
If you have any questions or comments, please speak to your KPMG contact or, our R&D specialist, David McKay on 0131 451 7790 or via email.
Finance Bill 2012 Draft Clauses published on 6 December 2011
The Government’s Tax Consultation Framework, published in March 2011, sets out a new tax policy cycle for the development of the tax system. Under this framework, proposed tax changes are subject to consultation at the detailed policy design stage and also after the draft legislative clauses are published. The draft clauses published on 6 December 2011 will be subject to consultation until 10 February 2012. These measures will be included in Finance Bill 2012 together with the associated secondary legislation.
The areas covered by the draft clauses include:
- New Controlled Foreign Company ("CFC") Regime
- Patent Box
- Amendments to Research & Development ("R&D") tax relief
- Amendments to the Capital Allowances rules
- Statutory Residence Test for individuals – although its introduction is to be delayed until 6 April 2013
KPMG’s report on the draft clauses can be accessed by following the link below:
Finance Bill 2012 Draft Clauses - KPMG Report (PDF 480 KB)
UK Tax Competitiveness Report 2011
As discussed at our last Forum, the UK’s corporate tax competitiveness appears to have finally turned a corner, according to research commissioned by KPMG in the UK.
This improvement is driven by reforms to the taxation of foreign profits and the government’s commitment to making the UK tax system the "most competitive in the G20". The 50p tax rate is having a limited effect so far on businesses' ability to recruit senior talent but is "bad PR" for Britain, the survey finds.
KPMG’s full report can be accessed by following the link below:
UK Tax Competitiveness Report 2011 (PDF 1.05 MB)
Tax rates online
We are pleased to announce the introduction that will allow you to view and compare the latest tax rates, reviewed on a weekly basis.
The online tool allows for the comparison of multiple tax types in one country and one type of tax rate (e.g. corporate tax) across a maximum of five countries. Corporate and indirect tax rates are currently available, with individual income tax and social security rates expected to be added later this year. A permanent link will be maintained from the Tax Director Forum microsite.
The launch of the online tool coincides with the release of the 2011 Global Corporate and Indirect Tax Survey. The survey compares corporate tax rates as of 1 March 2011 with equivalent rates back to 2000, as well as providing information on value added or goods and services taxes in 114 countries over the past six years.
