Here is a summary of the change:
– All those affected will be provided with more information in writing along with a new reference number for Corporation Tax.
– Individuals will still need to complete their SA700 for the tax year ending on 5 April 2020 for which a notice to file will be sent to them in April 2020.
– Corporation Tax returns are to be submitted online using the Inline eXtensible Business Reporting Language (known as iXBRL). For more information CLICK HERE.
– The change from Income Tax to Corporation Tax will not create a disposal event for the purposes of the Capital Allowances Act 2001 and to ensure that income is neither taxed twice, nor falls out of account, and that an expense is only relieved once.
The good news is that any business already completing the SA700 will benefit from being able to use online filing instead of manually completing and filing a return under the Income Tax self-assessment regime. This is a step forward in terms of the Government’s Making Tax Digital strategy. It is important to emphasise that provision has been made for the grandfathering of existing Income Tax losses so that it will be possible to carry them forward to the Corporation Tax regime. These can be offset against future UK property business profits that are chargeable to Corporation Tax. However, they will not be available for offset against other types of income and it will not be possible to surrender these losses as group relief.Hannah Roynon-Jones