This report highlights some of the Tax Faculty’s activities since the last report to 3 June 2019, and what we are working on at the moment.
This year's Wyman Symposium was held on 10 July 2019 in Chartered Accountants' Hall, with the topic 'Making the case for new taxes'. The audience of over 100 tax professionals heard four speakers who each set out a new tax policy idea and on which the audience voted for their preferred choice.
Tax Faculty conference
This year’s Tax Faculty conference on 5 July 2019 covered a wide range of topics including EU exit and the changes to off payroll working. It concluded with a practical points session from the Tax Faculty. Reports on the conference will be included in the September and October editions of TAXline.
Significant meetings and other activity
Meetings with Jesse Norman, Financial Secretary to the Treasury
Off-payroll working meetings
Continuing our dialogue with HMRC to clarify, and where possible simplify, practical aspects of the off-payrolling regime:
Office of Tax Simplification
Anita Monteith and Caroline Miskin met with members of the Office of Tax Simplification (OTS) to give early thoughts on its latest project, Simplification of tax reporting and payment arrangements for the self employed, which will consider easier ways to report taxable income by the self-employed and landlords of private residential property. The work will look at whether the processes involved could be made easier to understand and improved and builds on earlier work where the OTS considered the impact of the platform economy on how people manage their tax. The Tax Faculty will be hosting a webinar to encourage further discussion in September.
HMRC/HM Treasury Tax Policy School
Anita Monteith spoke at the Tax Policy School. The Tax Policy School is run by HMRC for civil servants moving into policy roles within HMRC and HM Treasury. The purpose of the week is to train policy officials in best practice when it comes to developing and presenting tax policy proposals through a series of talks and a group simulation exercise. Around 300 of their staff have been put through the school since 2014 when it started. Attendees are put into teams to work on an individual tax policy submission, which is then presented to a panel of judges at the end of the week, and a ‘winner’ selected. The judges always include senior Board members of HMRC and HMT and senior members of the tax profession. Jim Harra chaired this year and Anita was a member of the panel.
News from the committees
Technical Committee is due to meet on 13 August 2019. Agenda items include draft Finance Bill legislation, better policymaking, tax simplification, making tax digital, HMRC agent strategy, HMRC powers, HMRC service standards, off-payrolling, purchases of own shares, disclosable cross-border business arrangements (known as DAC6), and devolved taxes to mention but a few items.
Employment taxes and NIC
Employment Taxes & NIC Committee met on 10 July and on 5 August 2019. Topics for the 10 July meeting included off-payrolling, state aid and employment allowance (we shall be responding to HMRC’s invitation to comment), social security post Brexit, NAO inquiry into the interaction of universal credit and RTI, and RTI data quality, for which latter item HMRC’s Steve Shorrock joined us. The 5 August meeting covered the draft Finance Bill legislation and off-payrolling.
The Tax Faculty continues to follow up HMRC service issues through regular HMRC forums including the online agent forum, Virtual Communications Group, Issues Overview Group, Joint Initiative Steering Group, Compliance Reform Forum and Employment & Payroll Group.
The Tax Faculty has also been exploring other avenues to escalate service issues which are not being resolved through the standard routes as reports from members are suggesting a deterioration in the service being provided by HMRC.
Practitioner Tax Committee met on 5 June 2019.
With input from the committee the Tax Faculty has developed two new guides for tax agents, one on HMRC digital forms and one on HMRC digital services for agents.
Private Client Committee held its regular four monthly meeting on 20 June 2019. There was also a virtual meeting on 7 August to discuss the draft clauses in the Finance Bill.
Large business and international tax
Large Business and International Tax Committee met on 3 June 2019.
SME business tax
SME Business Tax Committee met on 2 April and 2 July 2019. Topics discussed included off payroll working, making tax digital, partnership expenses, entrepreneurs' relief and capital allowances.
The VAT committee met on 16 June 2019.
Making Tax Digital
The ICAEW MTD hub www.icaew.com/mtd was updated as the submission date for the first mandatory quarterly MTD for VAT returns on 7 August 2019 approached.
The number of MTD related queries from members has remained stable and the Tax Faculty is working with the ICAEW Technical Enquiry Service to ensure that we provide appropriate support to members.
The Tax Faculty has continued to engage with HMRC on MTD through the Software Advisory Group, the Joint VAT Consultative MTD sub-committee and the Additional Needs Working Group, providing feedback from members and obtaining clarity on a number of areas of technical uncertainty. This engagement has included an ICAEW led working group on issues around the agent services account and sign-up processes which are causing most difficulty. Frank Haskew, Anita Monteith and Caroline Miskin met Clare Sheehan and Anna Thomas on 22 July 2019 to discuss the progress of MTD.
TAXline: June 2019
In this issue, Paul Aplin provides his own perspective on tax, Sue Moore considers the impact of the EU money laundering directive on trusts, Joanne Walker looks at the Scottish income tax system for 2019/20 and Peter Bickley reports on a selection of points from the CIOT/ATT London Branch Employment taxes conference.
TAXline: July 2019
In this issue, Tina Riches considers HMRC’s updated view on tax avoidance schemes, Anita Monteith considers what lies over the horizon for Making Tax Digital, Julie Butler looks at how to treat wayleaves and Sarah Bradford explores the tax treatment of travel expenses incurred by employees in a range of situations.
TAXline: August 2019
In this issue, Kathryn Cearns OBE talks to journalist Caroline Biebuyck about the challenges in creating a more straightforward tax system, Bryan Crawford considers the actions that taxpayers should be taking when it comes to buildings allowances and Caroline Miskin explains Making Tax Digital for VAT’s recordkeeping requirements.
The following TAXguides have been published since the last report:
TAXguide 10/19: Expenses and Benefits
This TAXguide looks at the charge to tax on benefits and expenses, associated exemptions and deductions and, where a tax charge arises, the calculation of the taxable amount. It also examines the reporting obligations which result from the provision of expenses and benefits, and also at ways in which this burden can be reduced.
TAXguide 11/19: Capital allowances update
This TAXguide will cover the key changes to the capital allowances regime since Tax Practice supplement 21 on the subject in September 2008.
TAXguide 12/19: supplementary anti-money-laundering guidance for tax practitioners
Guidance for those providing tax services in the United Kingdom, on the prevention of money laundering and the countering of terrorist financing.
HMRC digital services for agents
This guide explains the HMRC digital services available to tax agents, how they can be accessed and the latest information on how HMRC intends to develop services in the future.
HMRC digital forms for agents
This guide lists and provides links to the digital forms available to agents.
The Tax Faculty is actively involved in producing content and providing information for the tax section of the ICAEW Brexit hub (see https://www.icaew.com/technical/economy/brexit).
Tax Faculty Webinars, TAXtalk, TAXbites and Podcasts
The following webinars have been produced since the last update:
In this webinar Charlotte Barbour, director of taxation, ICAS, and Frank Haskew, Head of Tax, ICAEW provide an overview of the devolved tax powers, and pointers to areas where care needs to be taken when advising clients across the UK.
Disguised remuneration, contractor loans and the 2019 charge
Since our original webinar in August 2018, several key milestones have passed, more is now known about the information which must be provided, the potential penalties and what help is available. In this webinar, Rebecca Benneyworth reprises the earlier recording and brings viewers up to date.
Employment taxes update
In this webinar Kate Upcraft and Peter Bickley cover the latest developments in the employment tax arena, including; preparation for the roll out of the IR35 off-payroll reforms to the private sector, tax regimes and optional remuneration arrangements.
David Kirk explores a number of recent key IR35 cases, mainly around employment status.
Steve Wade and Neal Smith consider prospective changes to the regime which from April 2020 will encompass non-small private sector business clients as well as public sector clients of contractors providing personal services through their own companies.
All Tax Faculty webinars and events can be found on a dedicated events page. TAXtalk and the MTD webinars are free to all members. Several new TAXbites have been produced, mainly on MTD.
Representations and Consultations
Tax representations submitted
The following formal representation has been submitted since the last report:
ICAEW REP 61/19 Devolved taxes - a policy framework for Scottish tax
A response dated 6 June 2019 to a consultation published by the Scottish government on 14 March 2019.
ICAEW REP 62/19 Transposition of the Fifth Money Laundering Directive
The Private Client Committee contributed to this response as it appertained to trusts dated 6 June 2019 to a consultation published by HM Treasury on 15 April 2019.
Consultations on which responses are being developed by committee volunteers and faculty technical managers are as listed below.
Employment allowance: eligibility & state aid
20 August 2019
Double tax dispute resolution in EU (CT, IT, CGT)
27 August 2019
Self-employed tax – reporting (OTS)
30 August 2019
Digital services tax
5 September 2019
Draft Finance Bill clauses
VAT: partial exemption and capital goods scheme
26 September 2019
Disclosable cross-border business arrangements (DAC6)
11 October 2019