CCH Personal Tax Release Notes

Transcription

1 CCH Personal Tax Release Notes

2 Legal Notice Disclaimer Wolters Kluwer (UK) Limited has made every effort to ensure the accuracy and completeness of these Release Notes. However, Wolters Kluwer (UK) Limited, its staff and agents will not be liable for any errors or omissions and use of the software is subject to the customer s licence with Wolters Kluwer (UK) Limited. These Release Notes should not be relied upon as a detailed specification of the system or the software. Wolters Kluwer (UK) Limited may make changes to these Release Notes from time to time. Copyright These Release Notes may not be copied, altered, edited, disposed of or distributed without the prior consent of Wolters Kluwer (UK) Limited. The content is confidential Wolters Kluwer (UK) Limited Elements of this product include software developed by MYOB Technology Pty Limited MYOB Technology Pty Limited. Distributed under licence by Wolters Kluwer (UK) Limited. Unless indicated otherwise all elements of this software product are owned by Wolters Kluwer (UK) Ltd. Trademark Rights Microsoft, Windows, Windows NT, Windows for Workgroups, Windows 98, 2000, XP, MS- DOS, Windows Vista, Windows 7, Windows 8, Windows 10, Windows Server, Microsoft SQL Server, and Microsoft Office, are either registered trademarks or trademarks of Microsoft Corporation. Novell and NetWare are trademarks of Novell Inc. Citrix MetaFrame is a registered trademark or trademarks of Citrix Systems, Inc. All rights reserved. All other trademarks are the property of their respective owners. Wolters Kluwer (UK) Limited 145 London Road, Kingston Upon Thames, Surrey KT2 6SR VERSION DECEMBER 2017 II

3 Contents Prerequisites 1 1. Legislative & Compliance Updates Carried Interest Comparison Report Exclusion 68 Validation Tax Return Creation and Workflow Digital Tax View DTA SA800 Land & Property Costs of replacing domestic items 9 III VERSION DECEMBER 2017

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5 Prerequisites Installing CCH Personal Tax This release is installed using the Central Suite Installer. This ensures that all prerequisites are in place and that all the products for which you are licenced are installed in the correct sequence. You can find out more about the Central Suite Installer here: sp?id=820 1 VERSION DECEMBER 2017

6 1. Legislative & Compliance Updates 1.1 Carried Interest The concept of Carried Interest was introduced into the 2017 Tax returns by HMRC. It is a share of the profits of an investment paid to the investment manager in excess of the amount that the manager contributes to the partnership, specifically in alternative investments i.e., private equity and hedge funds. Carried interest is chargeable to Capital Gains Tax and is taxed at 28%. It should be possible to set losses against Carried Interest however it is not currently possible to do this in CCH Personal Tax Allocation against losses We have created two override fields in the CGT summary panel allowing the Losses brought forward and used in the year and the Losses available to be carried forward to be overridden. This means that the values on the SA100 are correct and the return filed correctly. Note: These figures need to be calculated by you for any relevant cases. VERSION DECEMBER

7 Click the hyperlink and the override window appears: Enter details of the override and click back. The summary window is updated: The values in boxes 45 and 47 are updated on the Tax Return. To ensure that the tax calculation is correct use the existing hyperlink to enter an Adjustment to Capital Gains Tax. From the Capital Gains Tax data entry screen, click Adjustment to Capital Gains Tax and enter an override figure in the CGT adjustment screen. As Carried interest is taxed at 28% multiply the losses used by 28% and enter as a negative adjustment: Note: The override values are not rolled forward to the following year. The 2018 brought forward values must be reviewed and manually updated. Some clients have reported that the Losses available to be carried forward figure is sometimes doubled erroneously. If this happens, you may use the override facility to ensure the correct value is updated to box 47 of the return. 3 VERSION DECEMBER 2017

8 1.1.2 Schedules As it is not currently possible to allocate losses directly against Carried Interest, we have made adjustments to the CGT backing schedules where carried interest exists. The changes ensure that all values appearing on the SA108 are supported by entries appearing on the schedules. Addiitonally in these circumstances the Loss Allocation schedule is no longer produced as this is not be an accurate reflection of the losses position. The changes only affect taxpayers with Carried Interest. If your client does not have carried interest the existing schedules are automatically produced. VERSION DECEMBER

9 1.2 Comparison Report Following the release of the updated Tax computation by HMRC, it has been announced that HMRC are reviewing all tax returns submitted on paper and online for the year ended 5 April 2017 with a view to revisiting the calculations. Where the revised computations are different HMRC plans to contact the tax payer (and not their agent) with revised figures. In order that we may assist you to identify your potentially affected clients, we have introduced a comparison report identifying the CAL1/CAL2 (Box 1/Box 2) values from the most recently IR marked SA110 pages of the 2017 Tax Return and then comparing it with the values shown after upgrade to version of Personal Tax. This helps you to identify the clients likely to be contacted by HMRC advising them of a change to their Tax Liability for the year. To view the report select File > Tools > Tax Position Comparison Report: 5 VERSION DECEMBER 2017

10 Running the report may take some time, (AS PART OF OUR TESTING, WE RAN THIS ON A DATABASE WITH 3,000 CLLIENTS, THE REPORT TOOK MINUTES TO RUN) we have therefore introduced basic filtering options to help speed up the process: The report provides a list of all clients for whom a 2017 return has been submitted on line, listing the software version used and the values appearing in the CAL1/CAL2 boxes. To calculate the current tax position using HMRC s version 5.18 of the computation (as used in CCH Personal Tax version ) click Calculate. The updated values are calculated and the revised values appear in the report: Note: When running the report, please ensure that your short cut for Central is pointing to ClientFrameWork.exe. VERSION DECEMBER

11 1.2.1 Output to Excel To facilitate easy comparison of the data, click Export in the ribbon bar: Save the Excel file. Tip: If you wish to reorder the columns, we recommend that you do this after exporting the report to Excel and not within the Personal Tax report itself. Browse to the network location and open the file: Use the conditional formatting option to highlight where the same value is reported in the CAL1 columns or CAL2 if a repayment exists: Tip: Please see KB8766 for details on how to execute the conditional formatting. 7 VERSION DECEMBER 2017

12 In the above example Column C is highlighted for Captain James T Kirk as the values in Column C and F Match meaning there is no change in the calculated tax value for this client. Mr Comparison Test however is not highlighted meaning the values are different and may need reviewing. Note: We are only include clients for whom the return has been submitted online. During our testing process it was only a minority of cases identified as having different values. We believe this is due to Personal Tax including the exclusions at pre validation stage Dummy IR Marks Where a return has been submitted on paper or by a different agent / on different software an option exists in Personal Tax to enter a dummy IR mark. Where this has happened a value does not exist in the snapshot used to generate the latest values ; accordingly a values is not present in the Latest columns. After clicking Calculate, the Current CAL1 and CAL2 columns does contain the revised values: 1.3 Exclusion 68 Validation Following feedback from users, significant numbers of cases were being flagged as potentially falling under Exclusion 68, we were using the criteria supplied by HMRC which failed to take into account whether or not savings income was present. In this Service Pack we have added additional criteria to test for the presence of savings income and the Exclusion 68 warning only appears now where savings income exists. The criteria we have coded in this release is as follows: AND(c5.37 > c4.79, c5.35 < (c ,000), c5.76 > MAX(0, c c5.1)) which in English reads: AND(Total Savings income > Personal Savings Allowance, Non-savings income < Total allowances and deductions + SR_band, Taxable income > (Max (0, non savings income - Total allowances and deductions) VERSION DECEMBER

13 1.4 Tax Return Creation and Workflow In work had been undertaken to standardise the appearance of the workflow creation sections across the suite. As a result of this when progressing to the Workflow options stage the option specified in Tax System Parameters > Tax Return Creation Defaults no longer appeared (although the workflow was still created behind the scenes where appropriate). This has now been corrected and the option appears: 1.5 Digital Tax View DTA For users with CCH OneClick included in their licence, the View DTA button within a client s Tax Return was enabled regardless of the value the configuration key was set to. The button is now disabled when the configuration key is set to a value of zero. 1.6 SA800 Land & Property Costs of replacing domestic items When adding entries to the Cost of replacing domestic items for both Land & Property and Foreign Land & Property, where there is more than one source of income some users received the following message: The message no longer appears. 9 VERSION DECEMBER 2017