Frank Haskew, Head of the Tax Faculty, reports on recent developments at the Tax Faculty.
Autumn Budget 2021 and the Finance Bill 2021-22
We submitted evidence to the Treasury Select Committee on certain measures announced in the Autumn 2021 Budget. The Finance Bill 2021-22 was published on 4 November 2021 and we will be making representations on a number of clauses in the Bill, including basis period reform and uncertain tax treatments. We also expect to brief MPs in due course on a number of key clauses in the Bill on which we have concerns.
We would welcome comments on the Bill. Please send them to Peter Bickley.
The Hardman Lecture 2021
Former ICAEW President and former Chair of the Tax Faculty Paul Aplin presented our annual Hardman Lecture, when he gave an excellent talk entitled ‘Tax & Technology: Opportunity, Threat or Big Brother’. Aplin covered the many IT and data developments that are likely to drive changes in how tax is administered and what a tax practice might look like in the future.
I am pleased to report that we had more than 500 registrations for the lecture, which highlights that we can reach a much wider audience using virtual methods. We have asked Aplin to chair a new working party called Tax Professional 3.0, which will review what help and support we should be providing to members to make the most of opportunities afforded by the digital future.
Making Tax Digital
The Tax Faculty is finalising a new monthly series of Making Tax Digital (MTD) webinars, which will run through 2022. The plan is to provide support to members on different components of the MTD programme. Please keep an eye on our website for further details.
We continue to be concerned about some of the underlying policy aspects of MTD – in particular, the quarterly reporting requirements that, while they will provide HMRC with considerable amounts of data, are likely to be of little or no benefit to taxpayers and merely add administrative costs and burdens.
Basis period reform
We are currently reviewing the draft basis period rules to see whether they achieve their intended purpose and do not impose unnecessary burdens and create uncertainty. Although we recognise that the reforms will result in some simplification of the tax system by removing overlap relief, we remain concerned that the resulting uncertainty and compliance burdens will outweigh any benefits that might arise from its removal. We will continue to press for a reconsideration of this proposal.
Consultations and representations
On 5 November, we met with the National Audit Office to contribute to its investigation into the lessons that HMRC has learned from the introduction (in 2017) of the IR35/off-payroll working reforms.
We continued to engage with HMRC and with colleagues at the Chartered Institute of Taxation to arrange a follow-up meeting to consider concerns that members have identified with poor practices in the research and development reclaim sector.
We also continued to submit a number of informal representations to HMRC on a range of employer and national insurance contributions issues. We also met with HMRC’s Director of its Agent Strategy for a quarterly catch-up.
Committee meetings
During the period, there were virtual meetings of the Tax Policy and Reputation Committee and the Tax Faculty Board.
Webinars and other events
On 29 November, Kate Upcraft and Ian Holloway of the Tax Faculty’s Employer Taxes Committee presented a webinar on how to avoid being named and shamed by making mistakes with the National Minimum Wage.
On 30 November, Anita Monteith and Caroline Miskin presented a webinar designed to bring all members up to date on Making Tax Digital (MTD) developments. You can watch both webinars again by following the links on the ICAEW website.
We also participated in a number of ICAEW regional events and attended a round-table webinar of the tax directors of the Global Accounting Alliance, exploring tax issues facing the profession.
Finally, Anita Monteith and I presented a tax session to ICAEW Council members, which included the likely next steps on the compulsory PII consultation, MTD and basis period reform, and how ICAEW should develop a strategy for addressing green taxes
TAXguides
During the period, we published TAXguide 18/21. This guidance is designed to help employers ensure that payments made to HMRC are allocated correctly.