ICAEW Tax Faculty provides analysis of the announcements relating to tax administration and HMRC in the Spring Budget 2017.
The government response to the MTD consultations, published on 31 January 2017, deferred decisions on two important issues:
The Spring Budget announced that MTD will not become mandatory for small businesses and landlords with turnover below the VAT threshold until April 2019.
ICAEW welcomes this deferral of a year for smaller businesses which will allow more time for the software to be tested and for the necessary communication and training to take place. It will also allow for the gathering of data on the impact, including the cost to businesses and the impact of the tax gap which the government expects to be reduced by better record-keeping under MTD.
There was no mention of the turnover threshold which was previously announced at £10,000, other than draft legislation is to be introduced to allow the level of the exemption to be introduced through regulations.
The latest timetable for the start of MTD, subject to exemptions, is:
As anticipated, a consultation document with specific proposals for late submission penalties and penalty interest for late payment will be published on 20 March 2017. A consultation document on MTD for corporation tax and larger partnerships is also expected but is not listed in the schedule of future consultations.
The draft Finance Bill 2017 legislation published on 31 January 2017 will be expanded to:
In respect of the second bullet point above, we await more detail but this may provide an alternative way of reporting non-business income outside of self assessment.
The OOTLAR provides a list of all upcoming consultations relating to Budget measures, as follows:
|Employer-provided accommodation||20 March 2017|
|Withholding tax exemption for debt traded on a multilateral trading Facility||20 March 2017|
|Non-resident companies chargeable to income tax and non-resident CGT||20 March 2017|
|Landfill tax – extending the scope to illegal disposals||20 March 2017|
|Alcohol duty rates and bands||20 March 2017|
|Heated tobacco consultation||20 March 2017|
|VAT: fraud in the provision of labour in construction sector||20 March 2017|
|Digital tax administration||20 March 2017|
|Employee business expenses||20 March 2017|
|Taxation of benefits in kind
||20 March 2017|
|Oil and gas – tax for late life oil and gas assets
||20 March 2017|
|Red diesel call for evidence||20 March 2017|
|VAT – split payment model||20 March 2017|
|HGV road user levy||Spring 2017|
|Rent-a-Room relief||Summer 2017|
|Plant and machinery leasing – response to lease accounting changes||Summer 2017|
|HMRC Large Business Risk Review||Summer 2017|
|Tackling disguised remuneration avoidance schemes||Later in 2017|
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