MVL - Autumn Statement

[TheCyclingProgrammer]

That two year thing is nasty.

Presumably becoming a permo won't be classed as being "involved in a similar trade or activity"???

I would have thought not, as being employed is not trading.

However I wonder if that could catch those who close a Ltd but then start trading as self-employed instead (OK not many contractors work this way but seems a possibility).

[alphadog]

Would it be fair to say that even if someone commenced an MVL tomorrow, given that there is a good chance they will not receive their final distribution until after 6 Apr 2016, they would be unwise to work again for two years?

My initial reading of the draft legislation suggests that could be the case.

[TheFaQQer]

I would have thought not, as being employed is not trading.

However I wonder if that could catch those who close a Ltd but then start trading as self-employed instead (OK not many contractors work this way but seems a possibility).

Or those that close down to go permie, the job collapses after a year and then they set up another limited company.

Or those that have more than one company in the same line of business, eg. one man band and a small consultancy with other people.

[TheCyclingProgrammer]

Or those that close down to go permie, the job collapses after a year and then they set up another limited company.

I was specifically referring to the "same trade within 2 years" rule, which would catch the above scenario, but that wouldn't necessarily make you caught by the TAAR if the other rules don't apply.

In the above case I would imagine it is down to the person to show that the reason why the closed their company was neither mainly or partly for the purpose of gaining a tax advantage to avoid being caught by the TAAR - in the case of closing down to start a permanent job that might not be too difficult.

Hopefully HMRC will publish examples of what they would and wouldn't consider to be caught.

[AtW]

It seems to me that the government are trying very hard to remove the differences in tax treatment between the capital and income tax regimes - at least to the extent that overall they gain a similar slice of the overall funds in either case. As such I am quite certain that there will be further changes over time.

+1

The only reason they did not change CGT is because they want to do something big to it - "reform archaic" CGT probably and "simplify" the tax system... meaning much higher taxes.

Read details now and it seems unexpectedly mild measures - you can still do it, but just not do same trade for 2 years. I guess they gone mild on this because they plan to hike up CGT rates anyway.

[WordIsBond]

As always it is deliberately confusing to anyone, apart from the author, who himself was obviously confused to begin with.

FTFY

FTFY

[jamesearljones]

Just wondering if anybody in the know has some understanding/interpretations on the new capital distribution rules.

[RockyBalboa]

Would it be fair to say that even if someone commenced an MVL tomorrow, given that there is a good chance they will not receive their final distribution until after 6 Apr 2016, they would be unwise to work again for two years?

My initial reading of the draft legislation suggests that could be the case.

Good question!

[Maslins]

Just wondering if anybody in the know has some understanding/interpretations on the new capital distribution rules.

As a few people have said in this and other threads on the subject, basically going forwards if you restart in the same trade within 2 years of liquidating, you run the risk HMRC tax the distributions as dividends rather than as CGT receipts.

[RockyBalboa]

As a few people have said in this and other threads on the subject, basically going forwards if you restart in the same trade within 2 years of liquidating, you run the risk HMRC tax the distributions as dividends rather than as CGT receipts.

Would this apply now to the second distribution, as asked above, as it is highly likely one would receive it before April?