Following the results of last week’s general election, we feel it is important to highlight the effect on April’s Finance Bill.
The Government dropped many of the proposals from it to facilitate the election and said that the rest would be included in a post-election Finance Bill. The election result could well prompt a rethink of some of those proposals.
One of the deferred proposals was HMRC’s ambitious plan of Making Tax Digital (MTD), the aim being for all businesses to have a digital tax account that is updated periodically so that the taxpayer can keep track of their affairs. This is a significant change to the way that businesses will need to record and report their activities to HMRC and for some, (the self employed, including partnerships, and those with a rental business whose annual turnover or combined income exceeds £85,000) MTD was intended to start in April 2018. We suspect that the election may have made this date unrealistic but HMRC has staked a great deal on it and so may well still aim to achieve it.
That said, the Cabinet reshuffle following the election result has meant a change at the top of the Treasury. Coupled with the Democratic Unionist Party’s deeply held dislike for the measures due to the perceived disproportionate costs on small businesses – especially those in rural communities – this may lead to the whole programme being shelved, even if only for those small businesses. The CBW MTD team will of course ensure that all our clients, particularly those who may be affected by the April 2018 deadline, are kept up to date on any developments from HMRC.
CBW has also been working closely with many clients regarding the major changes on the taxation of non-UK domiciled individuals from April 2017, and this is just one of many areas where we will be looking to see if there are any further updates, please click here to read more.
CBW will, as always, keep a close eye on developments over the coming weeks and months as decisions are made by our Government, and crucially communicate what we believe these will mean for our clients and contacts. To receive our updates, please click here.
As always, if you have any queries, please do not hesitate to speak to your usual CBW contact or click here to message one of our tax specialists.