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New Tax Changes Proposed

The government has also published its intention to change a number of other tax reporting issues. Some of the more impactful for smaller businesses and Self Assessment tax payers are reproduced below:

1.    Simple Assessment – legislation will be introduced in Finance Bill 2016 to provide a new power to allow HMRC to make an assessment of a person's Income Tax or Capital Gains Tax liability without them first being required to complete a Self Assessment return where it has sufficient information about that individual to make the assessment. This measure will have effect on and after the date of Royal Assent to Finance Bill 2016.

2.    PAYE - ‘On or Before’ Reporting Obligation Review – HMRC have carried out a review of the ‘On or Before’ reporting obligations for employers who use the Real Time information payroll filing process. Currently, existing micro employers (with 9 or fewer employees) using Real-Time PAYE may take advantage of a reporting relaxation to report all payments they make in a tax month ‘on or before’ the last payday in the tax month rather than 'on or before' each and every payday. This is a 2 year temporary relaxation which is legislated to come to an end on 5 April 2016: this measure confirms the temporary relaxation will end, as planned, aligning the treatment of existing micro employers with all other employers.

3.    Capital Gains Tax: payment on account – from April 2019 a payment on account of any Capital Gains Tax (CGT) due on the disposal of residential property will be required to be made within 30 days of completion of the disposal. Taxpayers will be able to reconcile their payment on account with their total CGT liability for the year, after the year end. Legislation will be introduced in Finance Bill 2017 and the government will publish draft legislation for consultation in 2016.