皇冠体育app

Background

皇冠体育app independent Office of Tax Simplification鈥檚 (OTS) review聽of small business tax identified a population of businesses which want to 鈥渄isincorporate鈥� - change their legal form from a limited company to self employed - but a number of tax charges and administrative issues might be preventing this.

皇冠体育app OTS recommended that the Government introduce a relief against these tax charges alongside simplified administrative procedures for disincorporation. 皇冠体育app full OTS report can be found at:

Consultation

皇冠体育app OTS published two reports on this area 鈥� a discussion paper in July 2011 and the final report in March 2012.

This consultation built聽on these by: focusing questions specifically on those businesses identified by the OTS as most likely to want to disincorporate; further investigating the nature and scale of demand for the relief; examining some of the design parameters; and looking more closely at issues around creditor protection.

皇冠体育app consultation followed the Budget 2012 announcement that the Government would consult on the OTS proposal.

皇冠体育app Government was聽interested in views from a range of audiences, including individual businesses and their representatives, as part of this consultation. It was聽also interested in views from insolvency practitioners reflecting the links to the Companies Act.

皇冠体育app proposed disincorporation relief will:

• allow a company to transfer goodwill and an interest in land to its shareholders so that no corporation tax charge on the company arises on the transfer
• not extend to tax charges that might arise on the shareholders where, for example, the assets are distributed
• apply to companies with qualifying assets not exceeding 拢100,000. Qualifying assets are goodwill and land and buildings used in the business
• run for five years from April 2013.

Legislation will be introduced in Finance Bill 2013 to introduce disincorporation relief. 皇冠体育app draft of this legislation was published on 11 December and is now open for technical consultation. 皇冠体育app deadline for responses is 6 February 2013.

Related consultation

皇冠体育app OTS small business tax review also made recommendations on simplifying the tax system for the smallest businesses. As a result of this, on 27 March the Government launched a consultation on introducing a new, simpler cash basis for small self-employed businesses to calculate their tax from April 2013.

皇冠体育app consultation document can be found on the HMRC website using the following link:

皇冠体育app Government has also responded to this consultation and has published draft legislation on 11 December.

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