The UK tax system can be complicated and there are periodic moves to improve it. In a recent article in the FT, the Office of Tax Simplification (OTS), an independent statutory body that aims to make the UK tax system less complex, was cited as suggesting the online system be made easier to enable taxpayers to see different types of income in one place and be able to make ad hoc payments towards their tax bill if they wanted to. They are also pushing for tax payers to be able to regularly report information to HMRC using their online accounts, rather than once a year as they currently do.
The
number of self-employed people in the UK is around 5 million and whilst some
employ accountants, those who attempt to file their own tax return can end up
making costly errors by failing to pay what they should or missing out on
benefits. The recent example of self-employed people not paying enough Class 2
National Insurance contributions and so not accruing enough for a full state
pension highlights the dangers.
Getting
it wrong can be just as costly for companies.
We wrote
an article at the end of last year which asked “Is it time to overhaul Britain’s tax
system?” and explored some of the issues raised around this
question.
HMRC’s
increasingly forceful recovery measures
It
appears that HMRC is implementing more assertive measures to recover tax, from
both businesses and individuals, and over the last few years has shown that it
is prepared to recover tax outstanding as austerity measures have been
implemented and the government seeks to reduce its deficit.
The
Direct Recovery of Debts from 2015 gave HMRC the power to recover money owed
from individuals from their bank or building society accounts. According to a
government report published on the 16th April 2019, entitled “Review of the direct debt recovery
intervention”, this has raised around
£178m in tax revenue from April 2016 until
December 2018, with very few complaints or appeals.
With the
Budget now scheduled for March and given the Conservative Party’s pre-election
manifesto promising to cut taxes, there could be some welcome changes for both individuals,
who should see the threshold for national insurance contributions rising to
£9,500 a year this coming tax year, and businesses benefiting from a range of
tax cuts, including a reduction in business rates.
However,
the tax rules can still be difficult to navigate and innocent mistakes are
still penalised by HMRC so if you think your tax calculation from HMRC is
incorrect, it’s important to have an expert to help you.
Contact us
If you
think you’re owed a tax refund it will be time consuming and challenging for
you to recover on your own, so why not talk to us. Here at Sestini & Co we
dedicate considerable time and expertise to keeping up with changing case law
and ensuring we are up to date with the tax rules.
If
you need help with any tax-related issues and
would like to speak to us, give us a call
on 01761 241 861 or email us today.
We will be pleased to advise you or to invite you into our
offices in Paulton, near Bristol and Bath, for a consultation.
