Revenue news

Liquidation assets

HMRC and the Department of Trade and Industry have issued a statement concerning Leyland Daf Ltd. The statement is made in light of the judgment made in the House of Lords on 4 March 2004. This altered the way in which liquidators of companies may attempt to recover the payment of liquidation expenses and pay the preferential creditors, where the companies have granted floating charges over their assets. The statement follows:
'In cases where the company has granted a floating charge, the costs and expenses of the liquidation will rank after sums payable to both the preferential creditors and to holders of a floating charge and will not be payable ahead of the floating charge security. We are aware of the implications of this decision on insolvency practitioners, who face the prospect of not being paid their costs and expenses, in respect of the winding up.
'The Crown departments, whilst understanding the predicament that the insolvency practitioners may find themselves in, wish to make it clear that we cannot deviate from the underlying principles of this judgment. However, because we have been asked to confirm our policy, we are issuing this statement by way of clarification, to confirm how we will apply the judgment to cases being worked by insolvency practitioners.
'In practice we will take no action to disturb cases where costs/fees etc. were paid before the date of the House of Lords judgment. But if other creditors take such action, which results in payment of a Crown dividend, the payment will be accepted. In all other instances we expect the terms of the judgment to be strictly applied.'
www.hmrc.gov.uk

Pre-owned assets

HMRC have amended their guidance on liability to pre-owned assets tax. The questions relating to land and chattels have been corrected and the effects of domicile and residence have been clarified.
www.hmrc.gov.uk

Pensions manual

The first chapter of the Registered Pension Schemes Manual, covering protection under the new simplified pensions regime, has been published by HMRC. Regulations will be laid covering a number of protection issues, and the chapter will be updated once those regulations are in place.
www.hmrc.gov.uk

Negligible values

HMRC have accepted the following securities as having negligible value during May 2005 for the purposes of a claim under TCGA 1992, s 24(2).

Where the value of shares has become negligible, an allowable loss may be established by the owner claiming that they are treated as being sold and reacquired, either on the date of the claim or at a specified time within the two tax years prior to the date of claim.
See www.hmrc.gov.uk/cgt/negvalist.htm for the full list of negligible value securities.

Issue: 4012 / Categories: News , Inheritance Tax