Tax

As the UK braces itself for a second wave of COVID-19 the UK Chancellor has announced the Treasury’s Winter Economy Plan with the aim of protecting jobs and supporting businesses over the coming months. Despite the measures introduced in the Chancellor’s Summer Statement (reported by us https://www.proskauer.com/blog/chancellors-summer-statement-focuses-on-hospitality-sector), the UK’s economic recovery “is fragile” amidst the rising number of infections. Key points to note from today’s announcement: A new Job Support Scheme will be introduced from 1 November for six months with the aim of protecting “viable” jobs for those that have had to reduce their hours because of the…
On July 27, 2020, Senate Republicans introduced a series of bills and proposals that have been collectively referred to as the “Health, Economic Assistance, Liability Protection and Schools Act” (the “HEALS Act”).[1] The HEALS Act would enhance and expand certain provisions of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) (H.R. 748), and provide additional forms of relief, including certain tax credits for employers. This blog summarizes the most important tax proposals in the HEALS Act and compares them with the Health and Economic Recovery Omnibus Emergency Solutions Act (the “HEROES Act”)[2] that was…
As the UK’s lockdown is relaxed and unemployment figures are expected to continue to rise, the UK Chancellor gave his summer statement announcing measures to stimulate the economy as it recovers from the effects of coronavirus with a clear emphasis on encouraging people to spend money, particularly in the hospitality sector, to try to protect as many jobs as possible. The UK Chancellor stated the stark fact that in the space of two months during the pandemic the UK’s economy contracted by 25%, which is the same amount as it grew in the previous eighteen years and the IMF expects…
Originally published on April 2, 2020. Last updated as of June 9, 2020. On March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act (H.R. 6201), and on March 27, 2020, he signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) (H.R. 748).  This alert summarizes certain tax-related provisions of these new laws and has been updated to reflect subsequent guidance from the Internal Revenue Service (the “IRS”) on these provisions, and the Paycheck Protection Program Flexibility Act of 2020 (H.R. 7010). Sick and Family Leave Credits. Beginning April 1, 2020,…
The UK government has opened a consultation on draft legislation concerning the taxation of coronavirus business support payments. HMRC want views on the technical effectiveness of the proposed legislation in ensuring that grants covered by the legislation are subject to tax. Such grants include the much-reported Coronavirus Job Retention Scheme (“CJRS”) (as reported by us https://www.proskauer.com/blog/uk-government-announce-coronavirus-job-retention-scheme) and the Self-Employment Income Support Scheme (“SEISS”) (as reported by us https://www.proskauertaxtalks.com/2020/03/covid-19-uk-chancellor-announces-measures-to-support-the-self-employed/) introduced by the UK Chancellor. The legislation will also apply to: (a) the Small Business Grant Fund, the Retail, Hospitality and Leisure Grant Fund and the Discretionary Grant Fund, (b)…
Originally published on April 8, 2020. Updated as of May 20, 2020. In an effort to halt the spread of the novel coronavirus Covid-19 (“Covid-19”), on March 14, 2020 the French government mandated a shut-down of non-essential businesses and other venues open to the public. The shut-down ended on May 11, 2020. Among the businesses concerned were retail stores, shopping centers, and restaurants. Businesses were authorized to continue their online activities and related deliveries. The shut-down did not impact businesses that are considered “essential to the life of the nation”, such as food shops, drugstores, banks, and gas stations (the…
In light of COVID-19, and in response to requests from European trade associations, the European Commission has published its proposal to amend Directive 2011/16/EU which deals with various strands of administrative co-operation in the field of taxation. Significantly, the proposal includes an extension to the time limit for reporting information under the new rules on cross-border tax arrangements know as DAC 6 (implemented by Council Directive 2018/822/EU). Many member states have already implemented DAC 6 in domestic legislation. However, a lack of detailed guidance, the potential for differences in interpretation of key terms in DAC 6 between member states and…
On May 12, 2020, House Democrats introduced the Health and Economic Recovery Omnibus Emergency Solutions Act (the “HEROES Act”) (H.R. ___), a $3 trillion stimulus bill that would provide additional relief in response to the COVID-19 pandemic and resulting economic downturn.  The HEROES Act would eliminate the limitation on the deduction for state and local taxes for 2020 and 2021 and enhance and expand the earlier Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) (H.R. 748) and the Families First Coronavirus Response Act (the “FFCRA”) (H.R. 6201). However, the HEROES Act would also reverse some of…
We continue our blog series on COVID-19 implications on executive compensation matters with a post that addresses considerations relating to amending performance goals under equity and other incentive awards. Setting meaningful and effective performance goals often requires significant focus and analysis by compensation committees with the assistance of their advisors and management.  In light of current economic challenges, stock price volatility and business uncertainty surrounding COVID-19, performance goals and the corresponding targets governing annual and multi-year cash and equity-based incentive awards established in early 2020 or prior will likely not be achieved for many companies.  Accordingly, companies that sponsor these…
On May 6, 2020, Senators Chuck Grassley (R. Iowa) and Ron Wyden (D. Ore.), the Chair and Ranking Member of the Senate Finance Committee, introduced the Small Business Expense Protection Act of 2020 (S. ___),[1] which would reverse a recent Internal Revenue Service (“IRS”) Notice and permit deductions for expenses that relate to loan forgiveness under the Small Business Administration’s Paycheck Protection Program (the “PPP”). On May 8, 2020, a bipartisan group of Representatives introduced the Jumpstarting Our Businesses’ Success Credit Act (the “JOBS Credit Act”) (H.R. ___), which would expand the employee retention tax credit available…
On March 18, 2020, President Trump signed into law the Families First Coronavirus Response Act (“FFCRA”) (H.R. 6201), and on March 27, 2020, he signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) (H.R. 748). This alert summarizes certain loan and tax-related provisions of these new laws that are most relevant to nonprofit organizations.…
The COVID-19 pandemic has been wreaking havoc on the economy generally, and with respect to many asset classes of real estate, specifically, and the general consensus now is this unfortunate situation will not abate for some time in the future. Not surprisingly, with businesses closed, employees furloughed, and revenue streams severely challenged, many owners of real estate and their tenants are simply not making rent and debt service payments. When that happens, the value of the real estate is reset, leaving the equity and possibly some of the debt impaired. When fighting for survival it might seem like tax considerations…
On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) (H.R. 748).  This blog post summarizes the tax provisions of the CARES Act, and has been updated to reflect subsequent guidance from the Internal Revenue Service (“IRS”) on these provisions. Economic Impact Payments.  The CARES Act provides a refundable tax credit for 2020 of $1,200 to individual filers with adjusted gross incomes of $75,000 or less (or $112,500 or less for a head of household), and $2,400 to married couples filing jointly with adjusted gross incomes of $150,000 or…
On April 1, 2020, the Internal Revenue Service (“IRS”) posted on its website a series of frequently asked questions (“FAQs”) that explain the COVID-19-related tax credits available to small and midsize employers who are required to provide paid leave under the Families First Coronavirus Response Act (the “FFCRA”), which was signed into law by President Trump on March 18, 2020.  This blog summarizes some of the key items addressed by the FAQs, including which employers are eligible for these credits, and the requirements and documentation necessary for claiming the credits.…
In response to the COVID-19 crisis HMRC has updated its guidance on the process for getting documents stamped and paying the stamp duty, including that: Stock transfer forms should not be posted to the Stamp Office. Instead an electronic copy (which can be a scanned PDF) should be emailed to HMRC at stampdutymailbox@hmrc.gov.uk. The form should be fully completed, signed and dated. For these purposes HMRC will accept e-signatures. (https://www.gov.uk/guidance/pay-stamp-duty) Where instruments have already been posted a notification letter should be resubmitted electronically giving details of payments made in respect of the transaction. HMRC will not physically stamp…