Management of Taxes


The draft legislation in clause 91 follows a consultation document “Strengthening Tax Avoidance Sanctions and Deterrents: A discussion document” issued on 17 August 2016.  The response document issued on 5 December 2016 referred to modifying the existing penalty regime for users of tax avoidance, “so that penalties are chargeable when complex tax avoidance arrangements are defeated”. HMRC state in the explanatory notes to the draft legislation that the aim of the clause is to act as a disincentive to entering into tax avoidance.

To reduce complexity, cut down costly errors and create a more stable, predictable environment for taxpayers, the Government must change the way it makes tax and budget decisions, argues a new report from CIOT and two other institutes.

This is the latest in a series of consultations by HMRC which is considering changing the sanctions available for offshore tax evasion. It is proposing to introduce a ‘Requirement to Correct’ (RTC) obligation that aims to compel those with offshore interests who have yet to put their UK tax affairs in order to do so by September 2018 ahead of the widespread adoption of the Common Reporting Standard (CRS).  Taxpayers who fail to correct their tax affairs by September 2018 will be subject to a single, tougher set of Failure to Correct (FTC) sanctions for offshore tax evasion.

The CIOT comments sent to HMRC on 12 October on HMRC’s Discussion document “Strengthening Tax Avoidance Sanctions and Deterrents” in which HMRC were seeking views on the following specific proposals:

The CIOT comments sent to HMRC 12 October on Strengthening Tax Avoidance Sanctions and Deterrents.

The Finance Committee of the Scottish Parliament issued a call for evidence at the end of June 2016 to assist their inquiry on a Scottish approach to taxation. This follows the devolution of taxation powers via the Scotland Act 2012 and 2016, which means a greater focus on revenue-raising. As a result, the Finance Committee wished to start a debate on the approach to adopt in developing a Scottish approach to taxation.

A year ago, in his speech to Labour Conference, Shadow Chancellor John McDonnell announced he had commissioned a review of HMRC. That review, chaired by Professor Prem Sikka, reported today.

HMRC yesterday announced plans for a major reorganisation, with current directors-general being assigned new responsibilities

HMRC are running an event on 7 October 2016 in London aimed at SMEs and agents affected by Automatic Exchange of Information.  The event will include speakers from HMRC, industry and agents and will provide opportunities for 1-2-1 ‘surgeries’ plus small group discussions on due diligence best practice.

CIOT members, other tax professionals and anyone else with an interest in how tax policy is made, are invited to comment on a new paper published by CIOT, the Institute for Government and the Institute for Fiscal Studies.