Other news in brief

The Exchequer Secretary to the Treasury has confirmed that draft clauses for the next Finance Bill, covering pre-announced policy changes will be published on 21 July “along with accompanying explanatory notes, tax information and impact notes, responses to consultations and other supporting documents”. There are a number of policy changes that are due to come into effect in 2026 for which draft clauses might appear, but we won’t necessarily see everything, particularly if the Government is still working on the drafting (most likely where consultations have only recently closed) or has not made a final decision on a policy. Some of the measures we might see include: reform of Agricultural Property Relief and Business Property Relief; reform of the tax treatment of carried interest; the introduction of a dedicated service to provide advance tax certainty for major projects; and reform of the UK’s transfer pricing, permanent establishment and Diverted Profits Tax rules, although the consultation on the latter only closed on 7 July 2025 so it may be too soon for updated draft legislation to be ready. We will provide commentary on what is actually released in the next edition of Tax Matters Digest.

As mentioned previously in Tax Matters Digest, the rules for the UK’s Pillar Two Multinational Top-up Tax (MTT) recognise taxes paid under certain other jurisdictions ‘qualifying’ income inclusion rules and domestic top-up taxes, and regulations were published earlier this year setting out lists of territories with recognised taxes. Those regulations also gave HMRC the power to specify additions to each list by notice. Further regulations - The Multinational Top-up Tax (Pillar Two Territories, Qualifying Domestic Top-up Taxes and Accredited Qualifying Domestic Top-up Taxes) (Amendment) Regulations 2025 – have now been made, coming into force on 24 July 2025. These new regulations enable an HMRC notice that specifies additions to the lists of Pillar Two territories, qualifying domestic top-up taxes, and accredited qualifying domestic top-up taxes to take effect from a date before the notice is published. This is a procedural change to ensure the effective date of changes in the UK aligns with the date in the central record of internationally agreed qualifying territories and taxes published by the OECD/G20 Inclusive Framework without the need for numerous UK statutory instruments with would otherwise be required due to the retrospective nature of these changes.

HMRC are hosting a new webinar which may be of interest to some readers, covering the Transitional Safe Harbour rules which simplify compliance for groups within scope of the new OECD Pillar Two taxes. The webinar takes place at 3:45pm on Thursday 10 July and will include information on the Safe Harbour requirements, Country-by-Country reports (CbCR) and qualification tests.

The UK regulations for the new Crypto-Assets Reporting Framework and the updated Common Reporting Standard (CRS2.0) have been laid before Parliament. Both come into effect from 1 January 2026. The changes will affect banks, asset managers and insurance companies as well as bringing e-money providers and crypto-asset service providers into scope for the first time. The regulations are largely as expected, but it is important to note the major shift in penalty regimes - under both CARF and CRS there is a £300 penalty per account for failure to collect a self-certification or to apply due diligence, and a £100 penalty per account for incorrect reporting. The regulations also introduce a penalty for customers of institutions who fail to provide a self-certification when requested of up to £300.