HM Treasury has released ‘2021 Review of the Office of Tax Simplification: Final Report’ which summarises its review of the Office of Tax Simplification (OTS) in its role as independent adviser to the Chancellor on simplifying the tax system.

The OTS was established in July 2010 and placed on a statutory basis by Finance Act 2016. HM Treasury is required to conduct a review of the OTS’s effectiveness every five years.

The first review concludes that the need for the OTS’s function has not diminished and making eight recommendations aimed at maximising the impact of the OTS over the next five-year period and beyond suggests that the OTS should:

  • Explicitly state the reasoning behind recommendations, particularly those with a simplification and policy trade-off.
  • Add two additional independent board members.
  • Consider appointing members with expertise in the digital sector and/or customer experience.
  • Draw up a skills and knowledge matrix that governs recruitment, particularly increasing the analytical and policy skills mix.
  • Prioritise recommendations made, giving regard to taxpayers impacted, ease and cost of implementation and potential trade-offs.
  • Engage professional survey expertise and implement an internal process for determining membership of a review’s Consultative Committee to ensure diverse representation.
  • Revisit the volume of its output to allow more time for research, engagement and embedding output.
  • Clarify its approach to, and interpretation of, ‘tax simplification’, including clarifying its aims and measurement of success and progress.

It is anticipated that the necessary legislation will be amended to allow the appointment of two additional board members in due course.

Useful guides on this topic

OTS explores change to UK tax year
The Office of Tax Simplification (OTS) has released a report entitled 'The UK tax year-end date: exploring the potential for change'. This report explores the benefits, costs and wider implications of a change to the UK's year-end tax date.

OTS review of CGT: Simplifying practical, technical and administrative issues
The Office for Tax Simplification (OTS) has published ‘Simplifying practical, technical and administrative issues’, its second report on Capital Gains Tax (CGT). It recommends extensions to certain reliefs and a new 60-day deadline for paying and reporting CGT on residential property sales.

OTS: Digital will simplify tax for self-employed
The Office of Tax Simplification (OTS)'s latest report, 'Tax reporting and payment: Simplifying tax for self-employed people and residential landlords' recommends that HMRC make further use of digital systems to simplify how self-employed people and landlords report and pay their tax.

OTS report on simplifying claims and elections
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.

External link

2021 Review of the Office of Tax Simplification: Final Report

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