There are just ‘days left’ for the Consultative Committee of Accountancy
Bodies to appeal to the Treasury to reverse its earlier decision and extend tax
relief for early adopters of work in progress (WIP) accounting rules.
Lobbying by the accounting umbrella group has previously won tax relief for
the accounting practitioners and their clients, who are set to suffer a tax hit
as a result of UITF Abstract 40. The abstract changed the way service providers
accounted for revenue and WIP.
But the Treasury did not extend the relief to firms that adopted the
accounting treatment early.
Now Derek Allen, director of tax at ICAS, has warned that CCAB should make up
its mind on whether to lobby the Treasury.
‘It’s still very much up in the air,’ said Allen, ‘but the impending March
Budget means that a decision has to be made in a matter of days’.
ACCA head of tax Chas Roy-Chowdhury was more optimistic that a decision would
be reached by CCAB in favour of urging paymaster general Dawn Primarolo
to extend the relief.
‘It is fair for early adopters to be able to adjust their accounts,’ said
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