Draft legislation for Finance Bill 2021 published

The government has published further draft legislation for the Finance Bill 2021 in addition to those released in July. The latest provisions cover the plastic packaging tax tax implications of the withdrawal of the London inter-bank offered rate and hybrid and other mismatches. The measures on the construction industry scheme and research and development are summarised below. 

Construction industry scheme: Four amendments are legislated on the construction industry scheme. The first amendment simplifies the deemed contractor rules to prevent manipulation of the current rules so that a business cannot deliberately avoid operating the scheme. The second clarifies the rules on deductions for materials purchased by a sub-contractor to fulfil a construction contract to remove the scope for different interpretations. The third provides new powers for HMRC to restrict construction industry scheme set-off claims to prevent contractors incorrectly reducing their employer liabilities. The final amendment expands the...