The Office of Tax Simplification has published an interim report on its VAT simplification review and has issued a further call for evidence around the eight broad areas of complexity identified. The report poses a number of specific questions based on these areas:
The Office of Tax Simplification has published an interim report on its VAT simplification review and has issued a further call for evidence around the eight broad areas of complexity identified. The report poses a number of specific questions based on these areas:
Registration threshold: the implications of raising or lowering the threshold, which is already higher than in most other countries, given that some 44% of registered businesses already operate below the threshold in the UK;
Multiple rates: the boundary issues causing complexity around categories to which the standard rate, reduced rate, zero rate and exemption apply and consider whether these still reflect the current business environment;
Partial exemption, option to tax and capital goods scheme: alternatives or improvements to these processes, regarded as some of the most complicated areas of VAT;
Special accounting schemes: the extent to which the flat-rate scheme, retail schemes, tour operators margin scheme, agricultural flat-rate scheme, cash accounting and annual accounting schemes continue to be relevant in providing simplification;
Admin, penalties and appeals processes: the need for improved HMRC guidance, the perception of subjectivity and inconsistency in the system of VAT penalties and unfairness associated with the default surcharge (which MTD is due to replace), and aim to encourage better understanding of the statutory review process through improved decision letters;
Formal rulings: areas of VAT that would benefit most from a formal rulings system as a means of providing certainty;
Making tax digital: opportunities where simplification might be necessary to comply with MTD, and whether MTD will replace annual accounting and other simplified schemes altogether; and
Sector specific issues, including agriculture, higher education and research, charities, property and construction, and whether HMRC could show more flexibility in its handling of businesses.
The OTS asks for comments by 30 June and intends to publish its final report in the autumn. See http://bit.ly/2m6WbvM.
The Office of Tax Simplification has published an interim report on its VAT simplification review and has issued a further call for evidence around the eight broad areas of complexity identified. The report poses a number of specific questions based on these areas:
The Office of Tax Simplification has published an interim report on its VAT simplification review and has issued a further call for evidence around the eight broad areas of complexity identified. The report poses a number of specific questions based on these areas:
Registration threshold: the implications of raising or lowering the threshold, which is already higher than in most other countries, given that some 44% of registered businesses already operate below the threshold in the UK;
Multiple rates: the boundary issues causing complexity around categories to which the standard rate, reduced rate, zero rate and exemption apply and consider whether these still reflect the current business environment;
Partial exemption, option to tax and capital goods scheme: alternatives or improvements to these processes, regarded as some of the most complicated areas of VAT;
Special accounting schemes: the extent to which the flat-rate scheme, retail schemes, tour operators margin scheme, agricultural flat-rate scheme, cash accounting and annual accounting schemes continue to be relevant in providing simplification;
Admin, penalties and appeals processes: the need for improved HMRC guidance, the perception of subjectivity and inconsistency in the system of VAT penalties and unfairness associated with the default surcharge (which MTD is due to replace), and aim to encourage better understanding of the statutory review process through improved decision letters;
Formal rulings: areas of VAT that would benefit most from a formal rulings system as a means of providing certainty;
Making tax digital: opportunities where simplification might be necessary to comply with MTD, and whether MTD will replace annual accounting and other simplified schemes altogether; and
Sector specific issues, including agriculture, higher education and research, charities, property and construction, and whether HMRC could show more flexibility in its handling of businesses.
The OTS asks for comments by 30 June and intends to publish its final report in the autumn. See http://bit.ly/2m6WbvM.
