Introduction to Luke Cheng, Assistant Director at A&M Taxand Scotland
We are delighted to welcome Luke Cheng to our corporate tax team in Glasgow.
Luke has joined as an Assistant Director and is a member of The Institute of Chartered Accountants of Scotland and The Chartered Institute of Taxation.
Prior to joining A&M, Luke trained with KPMG in corporate tax, had a role in industry managing a large Scottish private business’ tax affairs and most recently was part of the EY corporate tax team.
Luke will provide support to A&M Scotland’s Asset Manager team through advising investment fund’s investee companies on all corporate tax matters.
HMRC updated guidance on carried interest
Section 103KE of the Taxation of Chargeable Gains Act (“TCGA”) 1992, which forms part of the “Capital Gains Tax (“CGT”) carry” rules contains provisions which prevent carried interest from being taxed twice.
Broadly, where “tax” - such as income tax - has been paid on carried interest - for example, where the carried interest takes the form of dividend or interest income - this “tax” can be credited when calculating CGT payable by the carried interest holder under the CGT carry rules. This effectively has ensured that the carried interest is not subject to double taxation under, for example, income tax and CGT.
On 19 January 2022, HMRC updated the ‘Investment Funds Manual’ IFM37410 - Prevention of double taxation: Introduction - to indicate that “tax” in relation to section 103KE TCGA 1992 now only relates to UK tax. Consequently, based on this update, UK taxes should be the only taxes which can be credited under the CGT carry rules.
This change may have a particular impact on Fund Executives who are UK tax resident but are also US taxpayers.
We understand that The British Private Equity & Venture Capital Association are due to meet HMRC later this month and we will provide an update on any developments in due course.
Self Assessment deadline on 31st January 2022
HMRC issued a press release on 6 January 2022 outlining that HMRC would waive late filing and late payment penalties for Self Assessment taxpayers for one month.
This means that:
- Late filing penalties will not be issued if the Self Assessment tax return is filed online by 28 February 2022; and
- Late payment penalties will not be issued if the tax liability is paid, in full - or a Time to Pay arrangement is set up - by 1 April 2022.
Please note that interest will be payable from 1 February 2022 on outstanding tax liabilities.