An entrepreneur, accountant and mainly an International Strategic Consultant specialising in Project Finance and Sovereign Risk analysis and funding.
A past Business School External Examiner and Moderator and ad hoc lecturer with an increasing focus on SME activity from 1998 and particularly technology and Venture Capital.
A widely published writer on global economy, business and technical issues.
An activist, promoting both SME and SMP interests to Government and regulators, as a representative of professional bodies and their holistic interests and concerns.
I am going to try to persuade HMRC that effectively their new partnership is the same trade.
It seems "Trade" is the critical word. For example, if say a carpenter who had been building and installing fitted wardrobes, ceased that activity but became self employed as a jobbing carpenter, he would still be working as a carpenter: not for example, a butcher...
Why do I state "Terminal Losses"? Since treating the case as such allows terminal loss relief. Thus the opportunity to write off the asset pool which as earlier explained was groaning with years of 4X4 disposals suffering from the abolition of Balancing Allowances. The clients could not use contract hire instead of purchasing the vehicles, as they were exclusively used for continental hire and therefore the hirer had to carry the registration document; contract hire means the owner retains the registration document.
The unrelieved losses amount to £106,796; unless they can be carried forward.
Is their no chance of arguing the “similar” business is a continuation of the old?
Yes indeed, David: it is a new partnership with a different trading name, using the same - reduced size - premises and trading in the same area of activity; and this will be my argument to HMRC.
Many thanks for all your responses. Certainly an eye opener!
Well, we as practitioners know full well what a mess HMRC are in and leaving aside the wondrous "Justification" of the Covid-19 pandemic, which has been a beautiful excuse for not only government agencies but also major system-critical companies to cite in excuse for their utter disinterest in replying to anyone.
For me, this demands the question, how on earth do HMRC plan to deal with and manage the shortly to be imposed nonsense of MTD-VAT, let alone the full blown version expected at some not so distant time in the future?
We all know the utter shambling mess Government and its agencies are in and have been for some time, now: for example, I recently had a letter from DVLA which threatened to suspend my driving license if I didn't reply within 14 days of the date of the letter: err, which letter wasn't actually posted (according to the franking) until the 14 days had already expired!
I regret I have inadvertently confused those kind enough to respond.
1. The client did not commence trading in 2017: it was many years priorpre-1997 and the current year rules.
2. I was under pressure plus my IT systems were causing horrendous online problems:
3. The client was working until a few days before becoming seriously ill and being whisked into an isolation ward:
Thus owing to trading period/fiscal year straddle:
Tax Year: 2019-20 = basis period- 01-11-2018 to 31-10-2019:
Tax Year: 2020-21 = basis period - 01-11-2019 to 31-10-2020:
Tax Year: 2021-22 = basis period - 01-11-2020 to date of demise, being 23-12-2020:
Therefore, how does one capture the income between 01-11-2020 and the client's demise?
One reply suggested cessation:
After waiting for one hour, I did finally manage to speak to the Agent Helpline, who pulled in a technical agent to assist.
The net result was I need to file a return for 2019-20 (I had been awaiting a P60 arising from his occupational pension).
I also need to file a return for 2020-21 and use a longer period of account, to take in the period from the end of the usual trading year to the date of decease; and to treat this as a cessation simultaneously.
My answers
Same VAT Number.
I am going to try to persuade HMRC that effectively their new partnership is the same trade.
It seems "Trade" is the critical word. For example, if say a carpenter who had been building and installing fitted wardrobes, ceased that activity but became self employed as a jobbing carpenter, he would still be working as a carpenter: not for example, a butcher...
Why do I state "Terminal Losses"? Since treating the case as such allows terminal loss relief. Thus the opportunity to write off the asset pool which as earlier explained was groaning with years of 4X4 disposals suffering from the abolition of Balancing Allowances. The clients could not use contract hire instead of purchasing the vehicles, as they were exclusively used for continental hire and therefore the hirer had to carry the registration document; contract hire means the owner retains the registration document.
The unrelieved losses amount to £106,796; unless they can be carried forward.
Many thanks for all your comments and input.
I will let you all know if I succeed!
The previous partnership has ceased.
A new partnership trades:
1. In part of the original premises:
2. Same partners:
3. Similar activity.
Yes indeed, David: it is a new partnership with a different trading name, using the same - reduced size - premises and trading in the same area of activity; and this will be my argument to HMRC.
Many thanks for all your responses. Certainly an eye opener!
Well, we as practitioners know full well what a mess HMRC are in and leaving aside the wondrous "Justification" of the Covid-19 pandemic, which has been a beautiful excuse for not only government agencies but also major system-critical companies to cite in excuse for their utter disinterest in replying to anyone.
For me, this demands the question, how on earth do HMRC plan to deal with and manage the shortly to be imposed nonsense of MTD-VAT, let alone the full blown version expected at some not so distant time in the future?
We all know the utter shambling mess Government and its agencies are in and have been for some time, now: for example, I recently had a letter from DVLA which threatened to suspend my driving license if I didn't reply within 14 days of the date of the letter: err, which letter wasn't actually posted (according to the franking) until the 14 days had already expired!
Makes you proud to be British, huh?
Why did I not accept the advice given, herein?
Purely since no one justified their advice and this case is a complicated probate matter to boot.
Perhaps someone can explain why their suggested advice was correct, please?
I regret I have inadvertently confused those kind enough to respond.
1. The client did not commence trading in 2017: it was many years priorpre-1997 and the current year rules.
2. I was under pressure plus my IT systems were causing horrendous online problems:
3. The client was working until a few days before becoming seriously ill and being whisked into an isolation ward:
Thus owing to trading period/fiscal year straddle:
Tax Year: 2019-20 = basis period- 01-11-2018 to 31-10-2019:
Tax Year: 2020-21 = basis period - 01-11-2019 to 31-10-2020:
Tax Year: 2021-22 = basis period - 01-11-2020 to date of demise, being 23-12-2020:
Therefore, how does one capture the income between 01-11-2020 and the client's demise?
One reply suggested cessation:
After waiting for one hour, I did finally manage to speak to the Agent Helpline, who pulled in a technical agent to assist.
The net result was I need to file a return for 2019-20 (I had been awaiting a P60 arising from his occupational pension).
I also need to file a return for 2020-21 and use a longer period of account, to take in the period from the end of the usual trading year to the date of decease; and to treat this as a cessation simultaneously.
Many thanks for all your input and ideas.
ALL profits arising after decease are taxed!
Income from stocks and shares; CGT, IHT.
The rapacious taxman's greed knows no bounds!
Yes: more system problems I'm afraid. Now (I hope) resolved.
Please read my latest posting.
Please read my latest posting.