A summary of key legal updates for the Private Client sector over the past week is as follows.
Making Tax Digital
The HMRC Making Tax Digital for income tax self-assessment ("MTD for ITSA") quarterly reporting system is being delayed for a further year. It will now be introduced in April 2024 for self-employed persons and landlords with an annual business income over £10,000. This delay is set out in regulations published on 23 September – the Finance (No 2) Act 2017, Sections 60 and 61 and Schedule 14 (Digital Reporting and Record-Keeping) (Appointed Day) Regulations 2021 - which also confirm the previously announced policy that trusts, estates, trustees of registered pension schemes and non-resident companies will not be required to join MTD ITSA. The primary legislation already exempts charitable trusts, trustees of exempt unauthorised unit trusts, the underwriting business of members of Lloyds, holders of shares in real estate investment trusts and participants in open-ended investment companies. Remittance basis taxpayers will not be required to comply in respect of their foreign income, although MTD reporting requirements will apply to their UK-source income. HMRC’s MTD for ITSA delayed for further year | STEP
The consultation on aligning probate fees in England and Wales to a single fee of £273 for all applicants closed on 23 September. The response submitted by the Society of Trust and Estate Practitioners ("STEP") urges that the distinction between professional and non-professional applicants' fees (currently £155 for professionals and £215 for non-professionals) should remain, and that the present "inadequacies" with the probate service be addressed before a fee increase is introduced. Subject to the outcome of the consultation, the Ministry of Justice intends to implement the revised fees in early 2022. Professional bodies respond to proposed probate fee increases in England and Wales | STEP
Advance Decision case
In PW, Re  EWCOP 52, the Court ruled it was in the best interests of an 80-year-old Jehovah's Witness to have a blood transfusion in circumstances where she lacked the capacity to make that decision. In doing so, the Court ruled invalid an advance decision in respect of such treatment which the woman made 20 years previously. Under s.25(2)(c) of the MCA 2005, an advance decision is invalid if the creator has done anything clearly inconsistent with the advance decision. The "clearly inconsistent" actions in this case included: a health and welfare Lasting Power of Attorney that the woman had recently made which did not include any refusal of blood transfusions; a recent request for a Do Not Resuscitate notice to be removed from her medical notes; and a statement made shortly before the hearing that she would have a blood transfusion if it would save her life. Also of relevance was that the advance decision had been made 20 years ago and not been reviewed or updated since. The key point for those advising on advance decisions is that clients should keep them under regular review, perhaps at the same time as their Will. High Court rules invalid advance decision by Jehovah's Witness | Practical Law (thomsonreuters.com)
HMRC "nudge" letters to non-doms
HMRC has begun to send "nudge" letters to individuals whom it believes have failed to report their liability to pay the remittance basis charge in 2019/20. Recipients are those whose records indicate they have lived in the UK for seven out of nine years or twelve out of fourteen years prior to 6 April 2019 and have claimed to be non-UK domiciled. Such individuals are being invited to submit an amended tax return without a formal enquiry being started. Residency and the remittance basis charge – HMRC one to many letter (tax.org.uk)