The UK government on January 18 launched a consultation on revised draft guidance on the upcoming uncertain tax treatment notification requirement for large businesses.
The new draft guidance reflects amendments received in response to feedback on an earlier draft released in August.
The uncertain tax treatment notification requirement is scheduled to take effect April 1. It will apply to companies and partnerships with a with a UK turnover above GBP 200 million (USD 273 million) and/or a UK balance sheet total over GBP 2 billion (USD 2.72 billion). This includes UK branches and permanent establishments of non-UK companies that meet the thresholds.
To comply with the uncertain tax treatment requirement, in-scope companies and partnerships will have to notify HM Revenue & Customs with respect to any relevant tax returns (e.g., corporate, VAT, PAYE) that include an “uncertain amount.” This includes amounts for which provision has been made in the taxpayer’s accounts to reflect that a different tax treatment may be applied to a transaction, as well as amounts to which a business has applied a tax treatment based on a legal interpretation that is inconsistent with a “known position” of HMRC.
The consultation is open until February 1. The government expects to publish final guidance by February 28.
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