Office of Tax Simplifications published a report including how to simplify reporting and payment arrangements for self-employed and landlords.
The Office of Tax Simplification (OTS) has published a report in which the main recommendations include merging individuals’ personal and business tax accounts, and reporting of income to HMRC by intermediaries or third parties. The integrated tax account should be able to receive and display data about self-employment income and rental income, including that reported by third parties, and also include a calculation of additional tax with an option for the individual to make regular payments on account of their tax liability during the tax year.
The report also introduces reporting from intermediaries and third parties (which are to be identified on a sector-by-sector basis), which would help to ensure effective reporting, provided this is fully integrated into the individual’s tax account. Consideration should also be given in the future to the withholding of tax from third party payments to the individual.
The overarching message from the OTS was that the new system, should it be developed, must be flexible, and taxpayers and third parties who might be required to provide information to HMRC should be given sufficient notice of changes along with key steps to be taken. Government is yet to respond to the recommendations made by the OTS.
For further information please contact :
© 2020 KPMG LLP a UK limited liability partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organisation please visit https://home.kpmg/governance.