TaxSource Total

Here you can access summary of the key current tax developments in Ireland, the UK and internationally as reported by Chartered Accountants Ireland

The report of key tax developments are displayed per year, per month, by Ireland, the UK or International and by report title

Finance Bill receives Royal Assent

The Finance Bill 2012 received Royal Assent and became Finance Act 2012 on 17 July.

The Act reflects the various legislative changes announced not only at Budget 2012 but also proposals that have been ongoing for some time, including major reform of the UK's controlled foreign company legislation.

In respect of the controlled foreign company legislation HMRC has issued, for consultation, draft guidance on how the new legislation is to be applied. Details are available at http://www.hmrc.gov.uk/drafts/cfc.htm.

A useful summary of all changes effective this Finance Act and those that will not be enacted until next year can be found in the HM Treasury document Overview of Tax Legislation and Rates.

As part of the Budget announcements readers will recall that the Government announced a cap on income tax reliefs to take effect next year. HM Treasury and HMRC are now consulting on the implementation of the cap. It is intended that once responses to the consultation have been received, draft legislation on the cap will be published in late Autumn.

By way of reminder the proposed cap will be introduced from 5 April 2013 and will be set at £50,000 or 25% of an individual's income, whichever is greater. The consultation document sets out the scope of the cap and invites comments on the implementation and delivery of the cap, including, in particular, responses to: how an individual's income will be defined and calculated for the purposes of the cap; when the cap will apply; how reliefs will be ordered; and the operation of the cap through Income Tax Self-Assessment.

The reliefs that will be capped are listed in Chapter 2. Tax relief on investment in the EIS will not be included in the cap and the vast majority of other investment in small business is also intended to be unaffected. While relief against general income will be capped, the ability to offset losses against future profits from the same business will remain unlimited.

Finance Act 2012 can be accessed on the Parliament website at http://www.legislation.gov.uk/ukpga/2012/14/enacted