In this edition of RSM’s weekly round-up of the most important tax news, we cover the latest developments. Please feel free to share this update with any of your colleagues.
Investing in cryptocurrencies? Then watch out for capital gains tax changes
With the Budget fast approaching some of the possible capital gains tax changes may have a strong effect on investors in cryptocurrencies. We consider the impact of a couple of projected changes. Will more people be drawn into the tax net, with more administration for little return?
Heard of the 60% tax rate? Welcome to 67.5% income tax!
The complexity of the current income tax rules already results in individuals paying an effective 60% income tax rate on income between £100,000 and £125,140. Proposed measures from the chancellor in the Autumn Statement look set to make that worse. Introducing: the 67.5% income tax band.
Incorporating a problem?
The announcements from the Treasury in advance of the Budget are that tax bills will increase for everyone, and with potential changes to capital gains tax and income tax, the restriction to mortgage interest relief may have more of an impact on landlords. Advisors are expecting a spike in incorporations as a result of the expected changes, but there is potentially a serious issue for unsuspecting taxpayers where bank debt is refinanced as part of the restructure.
Non fungible tokens – how does the VAT work?
The market in non-fungible tokens has been hit badly by the plunge in cryptoasset values caused by the FTX exchange bankruptcy. With the market having expanded rapidly and now contracting, suppliers of NFTs will need to consider the tax implications to help prevent non-compliance and unexpected tax exposures arising.
The non-dom IHT threat and crypto conundrum
There has been a lot of focus on the preferential tax treatment for non-UK domiciled individuals ahead of the forthcoming Autumn Statement and whether these tax advantages may be restricted in the future. One tax advantage that hasn’t received as much attention is the IHT position for non-doms. A change to these rules could lead to an exodus of non-doms from the UK. The issue is highlighted by the confusion over the IHT treatment of cryptoassets held by non-doms.