Commenting on yesterday's publication of a series of tax documents and consultation reports by the government, Jonathan Yeomans, Head of Tax at untied, said:
"We saw a raft of new tax documents published yesterday on Tax Administration and Maintenance Day, and I'm hard-pressed to think of another period in recent years when so much new material has come out at once. It’s important that this translates into simpler tax for people and businesses. Existing systems are complex and siloed. Looking forward we want to see tax as something that is able to be embedded in how people and businesses go about their lives.
“To deliver this change, we are calling on HMRC to deliver on its commitments around supporting innovation, and to recognise the contribution that others can bring to deliver this quickly and effectively.”
Key focus areas include:
In-year tax. Those of us who are employees are used to having tax taken immediately from our salaries under PAYE, but for someone self-employed, it can be up to 21 months between earning and paying the tax on that income. HMRC is looking for opportunities to bring this tax payment closer to real-time.
has demonstrated that this can be delivered today with simple HMRC engagement.
Tax compliance as a condition for licensing in Northern Ireland and Scotland. From 2023, 50,000 taxi, private hire and scrap metal licences in Northern Ireland and Scotland will be conditional on an applicant having successfully completed a tax check to confirm they are appropriately registered for tax. These tax checks are already set to be introduced in England and Wales from April 2022, impacting around 400,000 individuals and businesses operating in these sectors.
Registration for self-assessment. HMRC is looking at the right time and mechanisms for people to be registering for self-assessment. This is good news. We do not think that the current processes and policies are helping taxpayers. This should not just be a policy fix but an operational one as well - we have raised with HMRC our concerns about the significant numbers of applications for self-assessment being rejected. On the same lines, recent HMRC communications to accounting and tax institutes finally acknowledged significant processing delays.
Consultation feedback. HMRC has also shared summaries of responses to various consultations over recent months. One of these relates to what a future tax framework should look like. The document makes extensive reference to the use of data and HMRC’s ability to pull this from third parties. For this to be successful at scale, we believe this needs to be done openly, transparently and shared with the taxpayer in order to maintain the trust that is also discussed as a key outcome.
Coming soon. New consultations will cover compliance around Individual Savings Accounts (ISAs), landfill tax, business rates, alcohol duties and how HMRC can modernise its tax debt collection procedures.
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