To apply from April 2020
Although some of the amendments to existing corporate interest restriction and loss relief legislation will have effect from 1 April 2017 when the rules commenced, others are effective from later dates between 1 January 2018 and 1 April 2019.
The changes to the Corporate Interest Restriction rules as a result of the introduction of IFRS 16 will generally have effect for periods of account beginning on or after 1 January 2019, although certain amendments to the long funding lease rules will only have effect for leases entered into on or after 1 January 2019.
The changes for non-UK resident companies will have effect on and after 6 April 2020.
"These provisions will be welcomed by those investing in intellectual property in the UK. This is a further indication of the UK’s willingness to review and reform existing legislation to make the UK a more attractive location for investment in intellectual property-rich businesses."
"These reforms appear to be a welcome step for approved EIS fund managers and investors alike.
The increased emphasis on investment in KIC’s is of little surprise, whilst the relaxed time period for deploying capital will be beneficial for approved fund managers and their investment opportunities.
Investors should also benefit from the reforms by being able to claim relief earlier through offsetting their relief against income tax liabilities in the year before the fund closes.
The digitisation of the certificates and paperwork will also be welcomed for all parties involved through reducing the administrative burden previously involved with Venture Capital Schemes."
The Government plans to publish draft legislation for consultation in Summer 2019. The changes will have effect from 6 April 2020.
Some taxes collected and held by businesses on behalf of other taxpayers will instead be held in trust by the business to be paid to HMRC rather than be paid over to other creditors.
HMRC is to be made a preferred creditor to prevent taxes paid by employees and customers and held by insolvent businesses from being distributed to other creditors. The taxes to be held in trust will cover VAT, PAYE income tax, employee National Insurance Contributions and Construction Industry Scheme deductions. There is no change to the taxes paid directly by businesses, such as corporation tax and employer National Insurance Contributions. The change will, however, only be enacted in Finance Bill 2019-20.
"This change will adversely affect all unsecured creditors of insolvent businesses; for example ordinary trade suppliers, who will now likely receive less in an insolvency process, as more value is transferred to HMRC as a preferred creditor."
The change will from 6 April 2020.