Tax experts have warned that the Inland Revenue’s tax changes could bring chaos to the first year of corporate self-assessment.
Their concerns came nine months before the 1 July 1999 deadline which will force September reporting companies to pay their first quarterly instalments of corporation tax in April.
Tony Ellgood, a tax partner at PricewaterhouseCoopers, said the introduction of CTSA was complicated by other company tax issues, including abolition of ACT, new transfer-pricing rules and the introduction of a GAAR. He said: ‘We hope to get better clarification, but a large number of people have not got their act together yet.’
Ros Upton, an Ernst & Young tax partner, criticised the Revenue’s decision for payment in instalments when the changes have not been clarified. ‘You cannot pay instalments half-way through the year when you don’t know what the profits will be,’ she said.
ACCA’s senior technical officer, Chas Roy-Chowdhury, said the tranche of changes will make the system complicated.
*The Revenue reported a rise in self-assessment returns for the 30 September deadline by 9,000 to 4,433,400 following increases in partnership and trust returns.
But of these, individual returns fell by 60,000 to 4,081,700.
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