Tax Bites - September 2025

Welcome to the latest edition of RPC's Tax Bites – providing monthly bite-sized updates from the tax world.

News

OECD provides further guidance on the application of the crypto-asset reporting framework

The OECD has published updated FAQ documents to provide clarity on the application of the crypto-asset reporting framework and amended Common Reporting Standard. The FAQ documents can be viewed here and here.

The implementing legislation (Reporting Cryptoasset Service Providers (Due Diligence and Reporting Requirements) Regulations 2025 (SI 2025/744)) comes into force on 1 January 2026, at which point reporting crypto-asset service providers will be required to collect certain information from customers and pass this on to HMRC for exchange with other implementing jurisdictions.

HMRC updates mini-umbrella fraud guidance

HMRC has updated its mini-umbrella company fraud guidance to reference the Upper Tribunal's decision in Elphysic Limited & Ors v HMRC [2025] UKUT 236 (TCC).

In Elphysic, the Upper Tribunal held that the Ablessio principle, which allows HMRC to deregister a company from VAT where that company has used its VAT registration number for fraudulent purposes, applies even in circumstances where the directors of the company were not aware of the fraud.

HMRC publishes new manual on multi-national and domestic top-up taxes

HMRC has updated its internal manual on the Multi-national Top-up Tax (MTT) and Domestic Top-Up Tax (DTT). MTT is the UK's implementation of the income inclusion rule and undertaxed profits rule. These are widely known as the GloBE rules, as set out in the OECD's Pillar Two Model Rules. DTT is the UK's implementation of a qualifying domestic minimum top-up tax, which applies the Pillar Two rules to UK entities.

The new manual is based on previously published draft guidance and responses to consultations on those drafts.

HMRC publishes response to its call for evidence on how offshore anti-avoidance legislation could be improved

HMRC has published a summary of responses it has received to its call for evidence on the operation of personal tax offshore anti-avoidance legislation. Respondents agreed that the existing 'patchwork' of rules was no longer reflective of the modern world and created uncertainty for taxpayers and HMRC alike. Areas for alignment and simplification were highlighted, particularly in relation to avoiding double taxation and resolving inconsistencies surrounding the treatment of income and capital losses.

Case reports

Tribunal allows trustee's appeal in inheritance tax case

In Accuro Trust (Switzerland) SA v HMRC [2025] UKFTT 464 (TC), the First-tier Tribunal (FTT) held that when a non-UK domiciled individual added assets to an offshore trust and later became UK-domiciled, assets deposited after becoming UK domiciled remained 'excluded property', for the purposes of inheritance tax.

Although the law was changed in July 2020 (by Finance Act 2019 amending section 48(3), Inheritance Tax Act 1984), to provide that the excluded property test is the domicile of the settlor at the time the property became comprised in the settlement, this decision provides some clarity for trustees considering pre-July 2020 cases. It is surprising that HMRC chose to fight this case and it will be interesting to see if HMRC seek permission to appeal the FTT's decision to the Upper Tribunal. 

You can read our commentary on the decision here.

Tribunal allows taxpayer's R&D appeal

In Realbuzz Group Ltd v HMRC [2025] UKFTT 493 (TC), the FTT allowed the taxpayer's research and development (R&D) appeal confirming that HMRC could not issue a discovery assessment because the information provided by the taxpayer to HMRC before the enquiry window closed was sufficient to enable a hypothetical HMRC officer to realise that tax had been under assessed.

This case reinforces the importance of proper disclosure by taxpayers to HMRC. Where sufficient information has been provided within the enquiry window to alert a hypothetical officer to a potential tax loss, HMRC cannot rely on its discovery powers contained in paragraph 41, Schedule 18, Finance Act 1998, as a fallback. This decision also highlights the value of well-structured R&D reports that demonstrate engagement with the R&D qualifying criteria.

You can read our commentary on the decision here.

And finally …

In collaboration with Temple Tax Chambers, our latest Tax Take webinar series explores the UK tax landscape and key considerations for professionals and business leaders seeking insights into the often-complex world of tax.

Through a series of webinars hosted by tax experts from RPC and Temple Tax Chambers, we will be exploring the following topics:

• Research & Development tax reliefs | Thursday, 2 October, 1200–1300
Hosted by: Stephen Morse, Barrister at Temple Tax Chambers and Alexis Armitage, Senior Associate at RPC

• HMRC's information powers | Wednesday, 5 November, 1200–1300
Hosted by: Keith Gordon, Barrister at Temple Tax Chambers and Daniel Williams, Associate at RPC

Register here.