THE GOVERNMENT’S much vaunted plans to transform the tax system through digital technology – first mooted in last year’s Budget – now looks to have received a definitive fillip in the guise of a wave of new initiatives announced by the chancellor today.
Key among them is news that £71m in extra funding is being made available to improve the service HMRC provides to tax payers. This tranche of cash will help fund a seven day a week service by 2017 that will boast extended hours and Sunday opening on online services and tax and tax credit phone lines.
It has also vowed to improve existing telephone services and slash call waiting times by recruiting an extra 800 new call centre staff.
Other measures include a dedicated phone line and online forum for new businesses and the self-employed.
Kevin Hindley, managing director at Alvarez and Marsal Taxand UK, said: “HMRC sorely needs to improve the quality of its call centres to include better training of staff and lower waiting times. This should go some way to addressing these issues. The additional opening hours, and in particular Sunday opening, is very welcome.”
From 2018, landlords and the self-employed who keep digital tax records can adopt a pay-as-you-go payment plan.
Geraint Jones, head of private client tax services at BKL, said: “Anything that improves the service that HMRC offers to taxpayers in terms of quality of service and extended opening hours can only be a good thing.”
The government has vowed to consult on the measures later this year alongside deeper details of the Making Tax Digital programme.
But the government’s decision to abolish end-of-year tax returns in favour of online tax accounts has raised concerns among practitioners sceptical about the ambitious timetable and the long history of botched government IT projects.
Osborne confirmed in the 2015 Budget, his plans to switch to digital tax accounts for individuals and small businesses by 2020, with some five million small companies and the first ten million people making the switch in early 2016.
While many advisers saw the move as a natural progression for a system in need of an overhaul, the timetable and other practical issues have caused serious concern.
At the time of its initial announcement, HMRC moved to allay some of those concerns. Accountants, it said, would still be necessary because the system will at first, be voluntary, and many will still need help with compliance.
The ATT had previously expressed concern that the legislation was overly complex and created unnecessary complications within the practical working of the new allowances
Introduced in 2013 to encourage R&D investment, the scheme allows UK businesses to pay only 10% corporation tax on profits derived from any UK or certain EU patents
Yet, KPMG’s annual survey shows that the UK is still an attractive place to do business, despite falling in rankings in tax competitiveness and FDI appeal
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