Weekly tax brief | 2 September 2020

New £15 billion VAT refund scheme for NHS and central government could impact net funding and supporting businesses
Scott Harwood and Sarah Halsted
The Government has announced plans to simplify the way public bodies, including the NHS, recover VAT they are charged on outsourced activities and infrastructure projects. While this may seem welcome news upfront, the proposed full refund model could radically change the market for contractors and private sector competitors and may have a net effect on core public funding.

Why are US figures used in the algorithm which calculates the UK tax gap?
Sarah Saunders
The tax gap is HMRC’s estimate of the difference between the tax which should be paid, and the tax that is actually paid. It is a key factor in determining tax policy. It is therefore surprising to learn that US calculations of non-disclosure percentages are currently used to calculate the UK tax gap. The radical differences between the UK and US tax systems suggest this must distort the results.

Will employers terminate their gig economy workforce first with no redundancy pay?
Carolyn Brown
Workplace law is changing. As we await the definitive Supreme Court judgement on working status in the Uber case, and as CJRS tapers off, will employers terminate their gig economy workforce first without redundancy termination payments? We review the latest developments.