The Office for Tax Simplification (OTS) has published its report ‘Claims and elections review: simplifying administrative processes’ giving a number of recommendations to help to improve the operation of claims and elections.

The report notes that almost all of the UK’s 1,190 tax reliefs require a claim to be made and considers how the administrative processes for making claims and elections could be simplified.

A total of 15 recommendations are given, with Income Tax, Corporation Tax, Capital Gains Tax and VAT all being considered in the review.

General recommendations, to benefit the largest number of taxpayers included:

  • Making business and Personal Tax Accounts the hub for all taxpayer engagement with HMRC and adding the facility to make standalone claims with the upload of supporting documentation where required.
  • Ensuring time limits for claims and elections refer to a tax year or accounting period end.
  • Ensuring consistency in time limits for amending claims and elections within and outside a return.
  • Improving the functionality of online forms.
  • Making guidance clearer on how claims and elections should be made and increasing the number of templates available.

The report also makes a number of specific recommendations to benefit a broad spectrum of taxpayers, including:

  • Expanding the ability of employees to make Expense Claims within their personal tax accounts.
  • Streamlining the number of different levels of employee Flat Rate Expenses.
  • Restricting the ability to carry back Gift Aid donations to high-value donations, allowing the carryback of part of such donations and allowing tax returns to be amended within normal timescales for a carryback claim.
  • The provision of a template for capital allowance elections to agree the value of Fixtures.
  • The introduction of a de minimis threshold below which companies would be exempt from reporting their deductions allowance for Loss Relief purposes.
  • Widening the scope of the form to reclaim tax on Loans to Participators, allowing agents to undertake the process online and introducing a specific provision to facilitate earlier repayment of tax on loans to participators in the case of liquidations.
  • Reversing the operation of section 431 elections for Employment Related Securities purposes such that unrestricted market value applies automatically with an option to file an election to disapply that treatment.

HMRC welcomed the work undertaken by the OTS and advised it will carefully consider the recommendations in the report.


Time limits for making claims & adjustments
What is the time limit for making a claim for capital allowances? What is the time limit for amending a capital allowances claim?

Time limits for tax assessments, claims and refunds
What are the time limits for claiming a tax refund? How far can HMRC go back and raise an assessment? How many years back can a taxpayer appeal? What are the time limits for correcting a tax return?

Gift Aid carryback must be via an original tax return
In Alan Firth Webster [2020] EWHC 2275 (Ch), the claimant’s case for 'rectification' of his 2016/17 tax return to correct a Gift Aid claim error was dismissed by the court. It confirmed that a Gift Aid carryback election must be made in an original tax return.

Claims and Elections Review: Call for evidence 

External link

OTS Claims and Elections Review