The government has given in to pressures to moderate its Budget proposals regarding the taxation of multinational companies. The government will still restrict the use of mixer companies for tax purposes, but has extended the transition period announced in the Budget and made other changes. The aim is to make the UK an attractive place...Read More

The interest rate for underpayments on quarterly instalments is reduced from 8% to 7% from 20 April 2000. The rate for overpayments remains unchanged at 5.75%. [2000]Read More

Notes have been published concerning taxation of commercial websites and Internet servers. Under OECD guidelines a business is taxed in a country where it has a permanent establishment. If a business is taxed in two or more countries, a measure of relief is provided so that the business pays no more tax than if it...Read More

Customs has corrected a notice regarding the reduced rate of VAT on energy savings materials. Electric dual immersion water heaters with foam insulated water tanks are not energy saving materials which qualify for the reduced rate, as Customs incorrectly stated in its Budget notice 39/00. Installation of electric dual immersion heaters are eligible for the...Read More

Customs is increasing the threshold for compulsory bespoke VAT retail schemes from £10 million to £100 million annual turnover, it was announced in 2000. A retailer with an annual turnover below this new limit may still apply for a bespoke scheme if the existing schemes are either impractical or do not give a fair and...Read More

The quarterly limit for PAYE payments is increased from £1,000 a month to £1,500 from 6 April 2000. [2000]Read More

Compensation paid by banks on dormant accounts of Holocaust victims and frozen during the war will be exempt from tax. The banks are attempting to trace victims or their descendants with a view to restoring their frozen wealth. The initiative is called Restore UK. [2000]Read More

A fundamental question of the nature of a supply for VAT purposes was again considered by the VAT tribunal. British Airways operated a voucher system whereby a passenger whose flight was delayed could obtain free food from restaurants in the airside of the airport. Customs argued that the restaurants were supplying the food to the...Read More

The Urgent Issues Task Force has issued Information Sheet 37 in 2000 on accounting for national insurance on national insurance contributions on share option gains. Broadly the UITF proposes that provision should be made for national insurance on outstanding share options ar the national insurance rate applied to the difference between the market value of...Read More

Auditing guidance on pensions is expected in June 2000 because of continuing confusion about existing rules on disclosures in accounts. The guidance is not expected to contain any new provisions. It will simplify codify auditors’ existing responsibilities. Since the Pensions Act 1995 became effective in 1997, an increasing number of auditors have been disciplined for...Read More