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Faculty news: May 2023

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Published: 04 May 2023 Update History

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Frank Haskew looks at the restrictions on HMRC's ADL and examines the response to the IESBA exposure draft, plus details representations and committee meetings.

Tax Administration and Maintenance (TAM) Day 

On 27 April, the government published a variety of material as part of its TAM day. These included an expected consultation document on potential criminal offences for tax avoidance scheme promoters who continue selling tax avoidance schemes even though issued with a stop notice. Read the Tax Faculty’s summary

Restrictions on HMRC’s agent dedicated line (ADL)

At a meeting of the Representative Bodies Steering Group on 5 April, HMRC announced that the ADL would be severely restricted from 17 April to 2 June 2023. We expressed concern that the restriction in the ADL coupled with a further deterioration in HMRC’s service performance will have a serious impact on ICAEW members. The Tax Faculty is still considering what further action can be taken to improve matters and seeking assurances that the ADL will be restored in full with effect from 3 June 2023. 

Representational work

On 18 April, the Tax Faculty hosted a face-to-face meeting with HMRC at which our recommendations on the PAYE aspects of HMRC’s consultation document on simplifying and modernising HMRC’s income tax services through the tax administration framework were discussed.

MTD small business review

A team from the Tax Faculty met HMRC’s Making Tax Digital income tax self assessment (MTD ITSA) team to discuss the review for small businesses and landlords (broadly those with turnover of less than £30k). ICAEW’s position is that aspects of the policy (in particular quarterly reporting) need to be reconsidered and that the focus should be on digital record keeping. 

As a further follow up to this meeting, on 19 April we hosted a virtual roundtable comprising ICAEW members in practice and HMRC’s MTD team. The feedback from members was very aligned with that already provided to HMRC by the Tax Faculty and members also suggested that quarterly reports should not be required by taxpayers with turnover below the VAT threshold. Members were also doubtful about HMRC’s ability to deliver the MTD project, including the necessary customer support that will be required.

Bournemouth University visit

On 12 April, Anita Monteith led a team from the Tax Faculty to host a visit by students from Bournemouth University, who each presented an idea for reform of the UK tax system. Anita had visited the University in 2022 and presented a session explaining how ICAEW assesses new tax policy proposals. This visit gave an opportunity for the students to prepare and present their own tax policy suggestions as part of their final year assessment. Our thanks also go to Chris Sanger (EY Global Government and Risk Tax Leader and EY EMEIA and UK&I (Tax Centre) Tax Policy Leader) for supporting the event. 

CFE Tax Advisers Europe

On 20/21 April, Tax Faculty participants took part in the latest meetings of the CFE Tax Advisers committees in Brussels. These included meetings of the Professional Affairs Committee (PAC) and the Indirect Taxes Committee.

Professional conduct – responding to the IESBA exposure draft

As reported last month, we have been considering the exposure draft published by the International Ethics Standards Board (IESBA), which inserts new sections on tax planning and related services into IESBA’s existing ethical standard. We are also exploring with fellow Professional Conduct in Relation to Taxation (PCRT) bodies the possible scope for how the UK’s pan-professional PCRT might be reconciled with the IESBA proposals in such a way that preserves the PCRT as the prime UK ethical code for those who provide tax services in the UK. If you have any comments, please send them to Frank Haskew

Tax Faculty Committee meetings 

During the month, there were meetings of the Technical and Oversight Committee, the Employment Taxes and NIC Committee, the Private Client Committee, the VAT and Duties Committee, the Duties Sub-committee and the Tax Policy and Reputation Committee. 

Representations published

We submitted two representations in the month, as follows: 

ICAEW REP 028-23 VAT in the digital age. ICAEW commented on the VAT in the Digital Age proposals, which were published by the European Commission on 8 December 2022.

ICAEW REP 029-23 ADS proposed amendments. ICAEW responded to proposed amendments to the Additional Dwelling Supplement published by the Scottish Government on 8 February 2023.

Webinars and other events 

20 April – R&D tax relief changes webinar. We held a successful webinar where members of Mazars’ tax team explained the impact of the latest changes to the R&D tax relief rules. Our thanks go to Gary Collins, Chris Ridley and Matt Day from Mazars and to Tax Faculty Business tax manager Richard Jones for moderating the event. 

26 April – Tax in Practice webinar for ICAEW’s Small Practitioners Community, in which Caroline Miskin was joined by Rebecca Benneyworth. 

TAXguides

TAXguide 01/23: Payroll rates, allowances and thresholds in 2023/24 has been prepared by Ian Holloway in advance of his upcoming webinar on 16 May – Tax Faculty Payroll and Rewards update 2023.

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