Calendar year basis of assessment a ‘simplification’

The CIOT has responded to HMRC’s consultation on the taxation of investment income received from overseas. Alignment of the UK’s tax year with the calendar year for the purposes of overseas income would be a potential simplification notes the Institute. Clear communication and guidance around what basis of assessment applied to different types of income would however be essential to avoid confusion. That could be side-stepped by considering a much more significant change: aligning the UK tax year generally with the calendar year as the CIOT reflects: ‘We would encourage the Government to look again at this as it could potentially simplify the UK tax system in the long term and make compliance easier particularly since more and more data is being shared internationally as new exchange of information agreements are developed eg through the OECD. Also multinational businesses and internationally...