In William Archer v HMRC [2022] EWCA Civ 626, the Court of Appeal dismissed an appeal against penalties for late payment of tax following a judicial review of closure notices. The judicial review amounted to a reasonable excuse for late payment but not throughout the period of non-payment and the delay in making payment once that excuse ended was unreasonable.
SME Tax News
HMRC have issued their Agent Update for June 2023. We have summarised the key content for you with links to our detailed guidance on the topics covered.
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HMRC needs to have a re-think to find ways to simplify their Making Tax Digital (MTD) project in order to avoid vast future cost overruns. A National Audit Office (NAO) report this week shows that HMRC is currently 400% over budget. As far as throwing money into a vast 'black hole', few thought that anything could beat the IT disaster that was the COVID-19 Track n' Trace app. I hope that this is a wake-up call for all concerned. The MTD project now needs to be reviewed and aptly refined to ensure that it keeps up with technological change, delivers value for money and creates a significant improvement in tax reporting.
A new survey measures the impacts of IR35 and Off-Payroll Working reforms. It shows that in terms of their current engagements, two-thirds of professional contractors still favour working via the established model of a Personal Service Company. There is also good news for HMRC: its Check Employment Status Tool is giving acceptable results for contractors.
HMRC have published their Employer Bulletin for June 2023. We have summarised the key content for you, with links to our detailed guidance on the topics covered.
In Top-Notch Accountants Limited v HMRC [2023] TC08833, the First Tier Tribunal (FTT) found that the Coronavirus Job Retention Scheme (CJRS) conditions were not met. Documents produced in support of the claim had been deliberately manipulated.
The Chartered Institute of Taxation (CIOT) has reported that HMRC have commenced their compliance response to the Pandora Papers (The Papers). The Papers was a large leaking of documents containing sensitive offshore financial investment data in 2021. HMRC are now following up with individual taxpayers who they believe have not disclosed all taxable income.
HMRC's Making Tax Digital (MTD) project has overrun in costs by over £1 billion, and its still only half-baked.The National Audit Office (NAO) has issued a report, ‘Value for Money - Progress with Making Tax Digital’ which confirms that its not value for money. The taxpayer will conclude that the project has been poorly designed and mismanaged.
HMRC have announced that they are closing the Self Assessment telephone helpline for three months in order to re-direct staff to clear up the postal backlog. The closure comes after a decision to close its VAT registration helpline last month. Taxpayers who have tax queries are now being directed to search for answers to their queries online.
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Following research and consultation, HMRC is consulting on new proposals for tackling PAYE non-compliance by ‘Umbrella companies’. Quite why we need more new rules when we could surely just sweep up any stragglers by broadening the Agency rules in Chapter 7 Part 2 ITEPA 2003 is beyond me. We will keep following the consultations for you and see what comes out.