Archive for September, 2016

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Making Tax Digital: 1/7 Start here

September 21, 2016

This is the first of seven posts I plan to make over the next couple of weeks on the subject of “Making Tax Digital”.  There are detailed proposals out for consultation till the beginning of November and which you can find from this landing page on gov.uk.  There is also an introductory video and an invitation to sign up for a “webinar”, a seminar conducted over the internet with some clever software.  You might also have seen my preliminary thoughts in this blog entry.

Why am I adding to all this verbiage with blog entries?  Because I don’t think anyone with an actual business to run will have time to read all this stuff, and I think it’s important.  So I’m going to try and summarise what the issues are, and how businesses can best respond.

My first thought is this: NO MANDATION WITHOUT REPRESENTATION

Mandation?  HMRC wants to “mandate” the proposals, make them compulsory, in other words you are going to have to start keeping digital records under pain of penalties.  But HMRC is using this technocratic, stick-seven-consultation-documents-on-a-website-and-expect-that-means-people-know-about-it, method of letting people know.  Surely small businesses are too busy running a business to read this stuff and are unlikely to know it’s there to be looked at in the first place.  The small business community is represented in HMRC circles by a Digital Advisory Group and by ABAB, the Administrative Burdens Advisory Board, and – no disrespect to the volunteers on those groups who do a lot of unpaid work on behalf of small businesses everywhere – have most small business owners even heard of their existence?

Watch this space!

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Serendipity

September 16, 2016

The House of Lords are looking into the process of law making.  I imagine a submission consisting of my previous post and the suggestion they just stop doing it for a while might not be entirely welcome?  But I can’t say I’m not tempted…

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Tax Simplification: A Modest Proposal

September 12, 2016

There’s to be another Autumn Statement at the end of November.  Oh joy.

Here’s an idea.  Stop having an annual Finance Bill, an annual Budget, and an annual Autumn Statement.  Replace them with some kind of “state of the union” style speech telling us how we’re doing (and there goes the Autumn Statement), a Financial Statement – a set of annual accounts and details of routine uprating of allowances etc (and there goes the Budget), and, best of all, a Tax Bill that the Chancellor has to bid for space for alongside all the other bids for Parliamentary time that are out there, so the temptation to mess with the edges is abolished along with the Finance Bill.

Seriously.  Just stop letting Treasury and HMRC policy wonks float their favourite ideas as “budget starters” and do away with the thousand page Finance Bills.  Maybe you’d end up with a Tax Bill about every year anyway… and maybe you wouldn’t.  A moratorium on tax changes till after Brexit?  How about it?

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A quick note on citizen stakeholders. And, tents.

September 5, 2016

I bloody hate the term “stakeholder”.  It started off as a reasonable sort of idea, that a business doesn’t just have to answer to its shareholders but has a wider responsibility to its customers, employees, suppliers and to society in general.  The current usage of stakeholder, so far as I can see, is to mean ‘anyone who might affect or be affected by an organisation’, in other words it’s a word in danger of becoming almost meaningless.  Unless you’re HMRC.

Yes, HMRC had its annual “stakeholder conference” today.  Yes, yes, I know it’s going to look like I’m having a massive attack of Lyndon B Johnson’s tent syndrome because I wasn’t invited, but bear with me.  Whoever they invite (here’s the list from the first one, in 2013) they can’t hope to include everyone.

But they bloody should include everyone, because we are all stakeholders in – affected by the actions of – our national tax authority.  At the very least, you’d think a twenty-first century government department with ambitions to make itself one of the most digitally advanced tax authorities in the world could manage to live stream the conference so we didn’t have to follow it second hand on twitter.

Nobody cares, I think I hear you say?  Well, people don’t know what they don’t know.  I have been conducting a little experiment lately where every time I have a conversation with a small business owner (and I mean a really small business – the hairdressers and taxi drivers of this world, the coffee shop owners and pub landlords) I have asked them about Making Tax Digital, the ambitious plan to make HMRC digital by making us all keep records electronically and none of your excel spreadsheets and carrier bags of records either.  None of my small businesses had heard of MTD, unless I have prompted them with the “four tax returns a year” horror stories from the budget before last, and then it’s been a vague, might have come across it.  And then I have (to the best of my knowledge and ability) explained it, and then I have spent the rest of my visit scraping them off the ceiling and advising them to write to their MP and to answer the consultation rather than shouting at me.

In other words, no-one is interested in HMRC until it does something that affects them.  And MTD will affect us all: we are all stakeholders.  Talk to us all, HMRC: not just to the Usual Suspects but to the people who won’t know they’re interested till you interest them.  Because interested is better than furious, honest.

 

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