Plans For Quarterly Tax Returns Rubbished

In a report published on 5 April, the Administrative Burdens Advisory Board (ABAB) has warned that the plans announced by George Osborne to introduce a new digital tax system for the self-employed (including mandatory quarterly updates) would create a significant added burden in terms of accounting records and costs for SMEs.

Quoted by the Guardian:

“Compulsory digital record-keeping and quarterly online updates is not an approach we can endorse.

We are concerned that the proposals for quarterly updates will be more burdensome than they currently are with increased record-keeping and compliance costs. This will have a big impact on the smallest of businesses.”

The Federation of Small Businesses doesn't think much of the idea either.

Mike Cherry, national chairman, said:

“Forcing small firms to pay for expensive digital accounting software so they must submit extra tax returns is not going to help anyone. It will simply add to the cost of doing business in the UK. When every independent body and expert is lining up to tell you to stop, slow down and think again, it might be time to take a breather and listen to their concerns.”

A spokesperson from HMRC said:

“We are focussed on creating a tax system that is more effective, more efficient and easier for taxpayers and we will work closely with stakeholders to address their concerns. 99% of businesses already file their corporation tax online and 98% of VAT returns are filed online. 

The new digital accounts, which are not being introduced until 2018, will simply integrate the different information businesses already provide to HMRC into a simpler, streamlined system. This will reduce the burden of updating HMRC for small businesses.”

Let's see how that works out in reality then!

Tax does have to be taxing.

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