Weekly tax brief | 9 March 2021

25 per cent corporation tax makes personal service companies less attractive
Tim Parr
The 25 per cent corporation tax rate from 1 April 2023 will largely eliminate the benefit of personal service companies. In fact, the commercial advantages of employment status for workers will mean that individuals who have operated through personal service companies may be keen to go on to the payroll.

New penalty regime for VAT returns in 2022 – good news or bad?
Sarah Halsted
The government has confirmed in the Budget that the unpopular default surcharge regime for late submission and payment of VAT returns will be replaced next year. Who will be the winners and losers under the new system? 

Can HMRC build back better after the pandemic?
Alex Foster
 As we all look forward to emerging from the pandemic and resuming a more normal life, now is a good time for HMRC to reflect on any positives that have come out of the situation, specifically looking at the department’s processes and how it communicates with taxpayers?

HMRC set to strengthen civil information powers
Justin Stevenson
 HMRC is set to further strengthen its civil information powers following confirmation that a new Financial Institution Notice is to be introduced in Finance Bill 2021.

HMRC’s investment in fighting fraud and error
Sarah Saunders
The Budget contains measures to give more funds to help HMRC improve its technology and fight fraud. Predictions suggest the investment should more than pay for itself.

And finally… the super-deduction: why 130 per cent?
Tim Parr
The Chancellor’s Budget announcement of a super-deduction of 130 per cent was a necessary step given the announcement of the increase in the main rate of corporation tax to 25 per cent from April 2023.