Digital marketplaces to report sellers’ incomes from 2023

HMRC has published a consultation that outlines plans to implement reporting rules for digital platforms first put forward by the Organisation for Economic Co-operation and Development (OECD). In February 2020, the OECD consulted on proposed rules setting out how digital platforms should collect information about the income of sellers and report it to tax authorities. Under the new rules, websites and applications based in the UK will be required to report sellers’ income arising in the previous calendar year to…

HMRC has published a policy paper outlining the forthcoming changes to the penalties for late payment and interest harmonisation for taxpayers. The government intends to reform sanctions for late submission and late payments to make them ‘fairer and more consistent across taxes’. Initially, the changes will apply to VAT and Income Tax Self Assessment (ITSA). The changes will see interest charges and repayment interest harmonised to bring VAT in line with other tax regimes, including ITSA. Under the new regime,…

The Coronavirus Job Retention Scheme (CJRS) is being wound down on 30 September 2021 and data published by HMRC has revealed that 1.9 million workers remain on furlough. The data showed that the number of employees furloughed on the CJRS fell by 590,000 during June. The total number of furloughed workers is 1.9 million. The data also revealed that younger workers have been leaving furlough most quickly, whilst one in ten workers aged 65 or over were on furlough. For…

HMRC has updated the guidance on salary sacrifice. HMRC has removed the guidance on ‘Salary sacrifice arrangements set up before 6 April 2017’ as the transitional arrangements for calculating the value of the benefit came to an end on 5 April 2021. A salary sacrifice arrangement is an agreement to reduce an employee’s entitlement to cash pay, usually in return for a non-cash benefit. Employers can set up a salary sacrifice arrangement by changing the terms of the employee’s employment…

In response to HMRC’s consultation on simplifying the rules relating to land and property, the Institute of Chartered Accountants in England and Wales (ICAEW) has urged HMRC to abolish all VAT exemptions and remove all VAT options. The ICAEW stated that the VAT rules regarding land and property are ‘unnecessarily complex’ and stand to benefit from ‘significant simplification’. The Institute also highlighted the need for a more fundamental review of VAT exemptions. In its response, the ICAEW also argued that…

The Government has published draft clauses for the next Finance Bill, which broadly cover pre-announced policy changes. The Government is committed, where possible, to publishing most tax legislation in draft for technical consultation before the relevant Finance Bill is laid before Parliament. The consultation draft clauses is intended to make sure that the legislation works as intended. Each measure comprises A tax information and impact note (TIIN) Draft legislation An explanatory note which provides a more detailed guide to the…

HMRC has recently reported a consultation on how basis periods can be reformed for income tax for the self-employed. The consultation seeks to gather views on how best to implement a proposal to simplify the rules under which profits of an unincorporated trading business are allocated to tax years using basis periods. The consultation also includes suggestions regarding transitional rules for moving to the new system. HMRC aims to simplify the system before Making Tax Digital (MTD) for income tax…

A fifth grant covering May 2021 to September 2021 will be open to claim from late July 2021, the size of the grant will be made by how much your turnover has been reduced, in the years from April 2020 to April 2021. The grant is taxable and will be paid out in a single installment You must have traded in the tax year: Eligible applicants for the fifth SEISS grant must have been actively trading during the 2019/20 and…