Quarterly Tax Returns
April 27, 2016
I have been contacted by small businesses and constituents who have raised their concerns regarding the Treasury’s proposals to introduce quarterly tax returns. As such, I made representations to the Treasury and I received the below response from the relevant Minister.
As you will see, Mr Gauke writes that the Government is introducing simple and personalised digital accounts which will remove the need for annual tax returns.
He goes on to say that the HMRC is working to ensure that the changes produce a light-touch process which makes working with HMRC easier. Mr Gauke states that the reforms will not mean the equivalent of four tax returns each year. Quarterly updates will be different in several respects, such as by providing an in year picture of tax positions meaning that people with have greater certainty about what they owe. In most cases, little information will be needed and it will be quicker to complete.
Mr Gauke writes that a number of consultation will be held this year, followed by testing before there is any wide spread introduction of the reforms. The new processes will not come into effect until 2018, with the full transition introduced over the next three years to allow people time to adapt to the new system. I hope this response reassures you that the Government intends to simplify the tax return process and make it easier for everyone to use rather than make it more complex.