0

On July 20th this year the Chancellor George Osborne announced the establishment of the Office of Tax Simplification (“OTS”) charged with the task of providing the Government with independent advice on simplifying the UK tax system. Not before time!

Today the OTS announced details of two initial reviews, which are to be completed before the 2011 Budget  – a review of all tax reliefs, and a review of small business taxation.

Tax Reliefs Review

As part of the important work in reviewing Britain’s tax system, the OTS has published the first ever comprehensive list of the UK’s tax reliefs and allowances on its website, and is now inviting comments and views from those who use them.

The 1042 reliefs demonstrate the challenge facing the OTS, which has also published details of the review criteria and methodology which will be used to evaluate the effectiveness and relevance of the reliefs, before reporting back later in the year.

Small Business Taxation

The OTS will provide an initial report to the Chancellor by Budget 2011 that identifies areas of the tax system that cause the most day-to-day complexity and uncertainty for small businesses and recommend priority areas for simplification.

Once the Government has considered the initial report the OTS will be asked to produce specific recommendations on tax simplification for small businesses.

As part of the initial report, the OTS will explore alternative legislative approaches to IR35. IR35 (the intermediaries legislation) is legislation introduced in 2000 to counter avoidance of tax on employment income where workers receive payments from a client via an intermediary (usually a personal service company) and the relationship between the worker and the client would otherwise be one of employment.

This is a welcome first step that I first wrote about back in July. I just hope that the concerns I had them will be properly addressed.

Also See:

Category: Taxation

No comments yet.

Leave a Reply