- Following a 2021 consultation on how the tax administration framework could be improved, with respect to large businesses, the government is focusing on reducing uncertainty by, for example, setting up stakeholder working groups and providing better guidance and new Guidelines for Compliance (GfC). A Large Business pilot to accelerate long running transfer pricing enquiries ran in 2023 (AR pilot). The government also aims to improve the cooperative compliance experience.
- In 2023, the government ran two consultations: The Tax Administration Framework Review: information and data (on how HMRC's information and data-gathering powers could be updated to enable digitalisation of services, improve compliance and reduce administrative burdens, focussing on, inter alia, on standardising data provision from third parties, more flexible legislation, pre-population of returns) and The Tax Administration Framework Review: Creating innovative change through new legislative pilots, looking at a new approach to pilot changes.
- A further consultation was launched in February 2024: The Tax Administration Framework Review: enquiry and assessment powers, penalties, safeguards, seeking views on a range of potential opportunities to reform certain aspects of tax administration.
- Following 2023 commitments to report on tax simplification, at Spring Budget 2024 the government announced metrics to measure its progress. The government will track the views of small businesses and individuals on the ease of dealing with tax issues, and the ease of finding information (from HMRC’s annual customer survey); will measure ease of dealing with HMRC from the survey offered after using HMRC’s phone or digital services; and will include HMRC’s estimate of the net change in cost to businesses of meeting tax obligations.
- Also at the Spring Budget 2024, the government invested £140 million to improve HMRC’s ability to manage tax debts.
- Timing: Further GfCs are expected in 2024. The work on the cooperative compliance experience is ongoing. HMRC received a number of submissions to the AR pilot and those cases are being worked through. HMRC are seeking feedback on the process, particularly to establish any reasons why more submissions weren’t received. The information and data call for evidence and the consultation on legislative pilots both closed on 20 July 2023 and the government is considering the feedback received. The February consultation closes on 9 May 2024.
Resources (click to open)
- Spring Budget 2024, the Red Book, page 40 Box 2.C Tax Simplification (the Chancellor of the Exchequer, March 2024)
- The Tax Administration Framework Review: enquiry and assessment powers, penalties, safeguards (HMRC, February 2024)
- Simplification update - ministerial statement (The Financial Secretary to the Treasury, Nigel Huddleston MP, January 2024)
- HMRC simplification update (HMRC, January 2024)
- A letter from the Financial Secretary to the Treasury to the Chair of the Treasury Committee on tax simplification (December 2023)
- The Tax Administration Framework Review: information and data (HMRC, consultation, April 2023)
- The Tax Administration Framework Review: creating innovative change through new legislative pilots (HMRC, consultation, April 2023)
- Guidelines for Compliance (Collection, HMRC, October 2022)
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