September 30, 2020
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We would like to remind you that the deadline for filing the FBAR form, also known as FinCEN Form 114, for 2019 is October 15th 2020. Please ensure you submit your form online by this due date. You can complete and file the form at

Click Here

The Department of Treasury has powers to levy significant penalties if you do not meet your obligations to file.


September 30, 2020
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On August 28, the IRS announced that it would temporarily allow the use of digital signatures on certain forms that cannot be filed electronically. The agency added several more forms (PDF) to that list.

The IRS made this decision to help protect the health of taxpayers and tax professionals during the COVID-19 pandemic. The change will help to reduce in-person contact and lessen the risk to taxpayers and tax professionals, allowing both groups to work remotely to timely file forms.

The IRS added the following forms to the list of those being accepted digitally:

  • Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
  • Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
  • Form 709, U.S. Gift (and Generation-Skipping Transfer) Tax Return;
  • Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons;
  • Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts; and
  • Form 3520-A, Annual Information Return of Foreign Trust With a U.S. Owner.

September 30, 2020
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On 23 July 2020, the Treasury Department and the IRS published final regulations under Section 951A providing guidance with respect to the high-tax exception, which excepts certain ‘high-taxed’ income from being otherwise taxed as “Global Intangible Low-Tax Income” (GILTI). The final regulations maintain the same foreign tax rate threshold to be eligible for a high-taxed income exclusion while simultaneously modifying operational rules that may affect a U.S. individual’s decision to pursue the exclusion. In combination with these final regulations, Treasury and the IRS issued new proposed regulations conforming aspects of the Subpart F high-tax exception with the newly finalized GILTI high-tax exception, and providing for a single high-tax exception election under Section 954(b)(4).

Similar to the Subpart F High-Tax Exception, individual and corporate taxpayers may exclude from GILTI certain high-taxed income earned by a CFC. For this purpose, GILTI is deemed to be high-taxed if it is subject to an effective foreign tax rate in excess of 90% of the maximum U.S. corporate income tax rate. With a current U.S. corporate income tax rate of 21%, this equates to an 18.9% threshold for high-taxed income.

As compared to the proposed regulations, the final regulations offer more flexibility by allowing U.S. shareholders to elect into the high-tax exception on an annual basis. Generally, this applies for tax years beginning on or after July 23, 2020. This permits taxpayers to apply the election retroactively to any CFC tax year beginning after December 31, 2017, if they apply the final regulations consistently to each year for which the election is made.

U.S. individuals with interests in CFCs should discuss these changes with their U.S. tax advisors to better understand how to optimise the tax efficiency of their structures under these new regulations.


September 30, 2020
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Taxpayers are now required to report and pay CGT within 30 days for gains arising on UK residential properties. All disposals of UK real property made on and after 6 April 2020 by UK resident and UK non-residents must be reported through the new CGT on UK property account, which is separate to their personal tax account. The old NRCGT form can now only be used for disposals made prior to 6 April 2020.

HMRC has confirmed that it has fixed an issue with verification that was preventing some taxpayers (particularly overseas taxpayers) from setting up a Government Gateway account in order to access the CGT on UK property account.


September 30, 2020
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Chancellor of the Exchequer, Rishi Sunak, was due to deliver the next Budget in autumn. However, the Treasury have recently announced that the Autumn Budget will be scrapped this year because of the coronavirus pandemic. After borrowing and spending billions on the COVID-19 response so far, the Chancellor was reportedly considering different ways for this money to be clawed back. According to reports, a few of the areas that were going to be looked at were raising capital gains tax and corporation tax.

Mr Sunak has previously said some taxes will need to rise over the medium term. The reported tax increases under consideration included a sharp jump in corporation tax – reports suggested increasing corporation tax from 19% to 24% to increase revenue. Additionally, it was also suggested that capital gains tax might also be paid at the same rate as income tax to increase revenue.

The Chancellor has however insisted that a “horror show of tax rises” were not on the horizon. Mr Sunak said that while the Government “will need to do some difficult things” in an effort to “overcome short-term challenges”, this did not mean “a horror show of tax rises with no end in sight.” Mr Sunak also said that ministers will need to be honest with the public about the challenges ahead and show them how the Government plans to “correct our public finances and give our country the dynamic, low-tax economy we all want to see.”

Despite there being no Autumn Budget this year, there will be a spending review to set out the overall shape of government spending. Typically, the government outlines the state of the country’s finances in the Budget and, crucially, proposes tax changes. But any such decisions will now be put on hold until next year. Instead, the government will reveal how much each department is allowed to spend.

This could mean that the proposed tax changes are now just delayed. It is worthwhile taking these potential proposed changes into account during this period of ongoing uncertainty.

Please do not hesitate to contact us if you wish to discuss any of the matters above.


September 30, 2020
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A number of taxpayers have received letters from HMRC recently outlining that HMRC has information about their offshore income and gains. These letters seem to be different to previous letters which seemed to be ‘fishing expeditions’.

The latest version of the letter confirms that HMRC compared the information received under information exchange agreements with other countries, to the individual’s tax record and tax returns, before sending the letter. This indicates that the letter is not speculative. HMRC is taking a risk-based approach and is only contacting taxpayers where it is unable to reconcile the figures received under information exchange agreements to tax records and tax returns.

All the letters include a “certificate of tax position” form which HMRC asks the individual to complete and return whether they have additional tax liabilities to disclose or not. This is to encourage a response from the individual. HMRC generally gives 30 days from the date of the letter to respond.

If you have received such a letter, you should consider your position very carefully and the subsequent action that should be taken, especially whether the ‘certificate of tax position’ should be signed and returned. Frontier can of course assist with this matter, if you have received such a letter.


June 25, 2020
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The IRS issued its annual inflation adjustment for health savings accounts for 2021, at a time when many taxpayers are worried about their health in the midst of the coronavirus pandemic.

In Revenue Procedure 2020-32, the IRS stated that for calendar year 2021, the annual limitation on deductions for an individual with self-only coverage under a high deductible health plan is $3,600 (increase from $3,550 the previous year). For 2021, the annual limitation on deductions for an individual with family coverage under a high deductible health plan is $7,200 (increase from $7,100 the previous year).

A “high deductible health plan” is defined as a health plan with an annual deductible that is not less than $1,400 for self-only coverage or $2,800 for family coverage, and the annual out-of-pocket expenses do not exceed $7,000 for self-only coverage or $14,000 for family coverage.

The IRS announced in March that high-deductible health plans can now cover the cost of COVID-19 testing and treatment before the plan deductible is met.

As part of the CARES Act signed into law at the end of March, Congress is also now allowing people to use the HSA to pay for over-the counter drugs and medicine, such as pain relievers, without a doctor’s prescription. This essentially reverses a provision of the Affordable Care Act that required a prescription for such purchases. The CARES Act also allows the use of HSA’s for remote care services until 31st December 2021.


June 25, 2020
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This summer for the first time, taxpayers will be able to electronically file their Form 1040-X, “Amended U.S. Individual Income Tax Return.” Making the 1040-X an electronically filed form has been a goal of the IRS for a number of years, adding that it’s also been an ongoing request from the tax professional community and a continuing recommendation from the Internal Revenue Service Advisory Council and the Electronic Tax Administration Advisory Committee.

About 3 million Forms 1040-X are filed each year. Currently, taxpayers must mail a completed 1040-X to the IRS for processing. For now, only tax year 2019 Forms 1040 and 1040-SR returns will be able to be amended electronically. In general, taxpayers will still have the option to submit a paper version of the Form 1040-X.


June 25, 2020
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The US treasury department has now released proposed regulations in relation to changes to Like-Kind exchanges.

In Summary TCJA amended Section 1031 to limit its application to exchanges of real property. Deferral under section 1031, however, is not allowed for an exchange of real property held primarily for sale.

The proposed regulations add a definition for real property and address the receipt of personal property that is incidental to the real property exchange.

In the past the like-exchange rules applied to artwork and other collectibles for example.


June 25, 2020
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It’s now been a few week since the IRS first started making Coronavirus stimulus payments, and for most taxpayers with an AGI up to $75,000 for single filers, $112,500 for Head of Household filers and $150,000 for married filing jointly filers, this payment is automatic, either by bank transfer if your bank details were on your prior year tax return or by cheque sent to the address the IRS holds for you. This payment ($1,200 per taxpayer and $500 per dependent) is not considered as taxable income. Taxpayers can usually track their payment directly on the IRS website at

https://www.irs.gov/coronavirus/get-my-payment

There are exceptions for some eligible taxpayers and their dependents where the payment is not being sent. An example is if the spouse has an ITIN instead of an SSN, the system does not allow automatic payments. In cases such as this one, there will be a new entry on the 2020 US return form for the stimulus payment, and taxpayers can claim their payment that way.

There is currently a proposed second stimulus payment package on which the Senate may start work on shortly. Debates are still ongoing within the US Government; therefore further details are to follow.