Finance Bill 2017: Corporate tax reporting requirements ‘a burden’

Finance Bill 2017: Corporate tax reporting requirements 'a burden'

Companies must report on their complex financial structures including offshore accounts and notify HMRC

DETAILS on corporate tax reporting requirements have been released in the draft of the Finance Bill 2017.

The government intends, with the draft bill, to tackle tax evasion and avoidance as well as supporting business through the tax system, implementing policies following the Budget 2016 and the Autumn Statement.

 

The Finance Bill plans to prevent the use of disguised remuneration schemes, introduce a new tax avoidance scheme penalty. It will also create a new legal requirement to correct a failure on the payment of UK tax on offshore accounts and investments.

The new legal requirement is that companies must report on their complex financial structures including offshore accounts and notify HMRC, they will receive a notification number to provide to their clients who will be using it in their tax return or personal tax account.

Dawn Register, tax partner at BDO, said: “HMRC are trying to ensure that there are no loopholes for people avoiding common reporting standards. There will be concerns on reporting structure as many people and companies will already be tax compliant, it creates another administrative burden on those already fully tax compliant. HMRC are trying to catch those avoiding tax but it makes you wonder if more layers of rules are really needed.”

The consultation on draft legislation published 5 December 2016 will run until 1 February 2017, with final details being confirmed in Budget 2017 and legislation introduced in the corresponding Finance Bill.

David Prestwich, tax partner at Mazars, commented: “The most important aspect for accountants is actually what has not been covered in the draft bill. Also, the chance to further demonstrate why the UK is the number one place to do business was missed.”

In the recent Autumn Statement the government provided incentives to encourage business, social investment, and infrastructure. This included increasing the amount of Social Investment Tax Relief and providing 100% business rates relief.

Jane Ellison, financial secretary to the Treasury, said: “We are recognised as having one of the world’s most effective tax regimes and this government is acting to ensure it continues to provide certainty for businesses, fairness for workers and a sound tax base. We are making sure we are prepared to meet the challenges and seize the opportunities presented by Brexit.”

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

Professional Services Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine

Accounting Firms Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021

Making Tax Digital Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource