Helping newly registered businesses meet their tax obligations
Helping newly registered businesses meet their tax obligations

Author: Great Britain: National Audit Office

Publisher: The Stationery Office

Published: 2006-12-06

Total Pages: 40

ISBN-13: 9780102943825

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There are around 700,000 new businesses starting up each year, all of which are required to register with HM Revenue & Customs for their different liable taxes. If a business takes on employees for example they will need to pay, PAYE, and if the business has a turnover exceeding £61,000 they then become liable for VAT. Businesses though need to register separately for each tax for which they are liable. This NAO report examines opportunities for the HM Revenue & Customs to further improve the help to new businesses, and looks at three areas: the compliance record of newly registered businesses; the process of registering for a tax; the guidance and advice provided by the Department. The report also highlights a number of conclusions and recommendations, including: the Department should target those newly registered businesses which are likely to benefit most, such as those entirely new to business and have least understanding of their tax obligations; new businesses should be encouraged to use the email alert service provided by Business Link; the Department should make guidance forms easier to understand and complete and also work more closely with other organisations such as tax agents, Business Link and financial institutions to coordinate help for new businesses in general; the introduction of a single online tax registration for businesses would be beneficial; and the Department should work towards a one stop telephone information system to cover all taxes.

Engaging with tax agents
Engaging with tax agents

Author: Great Britain: National Audit Office

Publisher: The Stationery Office

Published: 2010-10-13

Total Pages: 40

ISBN-13: 9780102965483

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Good tax agents, third parties paid by taxpayers to act on their behalf in their dealings with HM Revenue & Customs, help their clients get their tax right. But, self-assessed income tax returns filed by customers represented by agents are more likely to have under-declarations of tax (resulting from error, failure to take reasonable care or evasion) than returns filed by non-represented taxpayers. A key reason may be that the tax affairs agents deal with are more complex. However, analysis indicates that paying for professional help is not without risk for a taxpayer and that there might be an opportunity for HMRC to increase tax revenues by providing better support to tax agents and by better targeting of poorer ones. A three per cent reduction in the average amount of tax under-declared by represented taxpayers could lead to over £100 million extra revenue each year. At present, lack of data on individual tax agents prevents the Department's taking a tailored approach to its dealings with agents and providing feedback on performance. With better use of data, HMRC could make more targeted interventions based on risk and achieve greater value for money. HMRC has recognised the importance of developing its relationship with tax agents and has taken steps to work more effectively with this group. Initiatives have included the introduction of a priority telephone line for agents' queries on self-assessed income tax and PAYE. The Department has also encouraged tax agents to file tax returns online.

Dimensions of Tax Design
Dimensions of Tax Design

Author: Institute for Fiscal Studies (IFS)

Publisher: OUP Oxford

Published: 2010-04-30

Total Pages: 1360

ISBN-13: 0191564826

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The goal of the Mirrlees Review has been to identify what makes a good tax system for an open developed economy in the 21st century and to suggest how the UK tax system could be reformed to move in that direction. As an integral part of the Review, this volume brings together thirteen studies of different dimensions of tax design, plus associated commentaries. These were commissioned from IFS researchers and other international experts, to be of interest and value in their own right, as well as to provide inspiration for the final report of the Review, which is published as a separate volume, Tax by Design. The Commission's work was directed by: Tim Besley Richard Blundell Malcolm Gammie James Poterba The Commission's editorial team: Stuart Adam Stephen Bond Robert Chote Paul Johnson Gareth Myles

Management of tax debt
Management of tax debt

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

Published: 2009-06-09

Total Pages: 44

ISBN-13: 9780215530639

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In 2007-08, HM Revenue & Customs (HMRC) collected around £450 billion in tax and National Insurance contributions from 35 million taxpayers. At 31 March 2008 the Department was owed £17.3 billion in outstanding tax, interest and penalties, £4.5 billion of which was more than a year old. Debts arise when people or businesses forget to pay, do not understand the need to pay or deliberately try to avoid or delay payment. Most tax payments are made on time, but during 2007-2008 30 per cent of tax payments were made after they were due, the number of tax debts increased by 22 per cent and the level and age of debt increased on some taxes. HMRC needs to change the behaviour of taxpayers who persistently pay late. HMRC could do more to encourage prompt payment and it also lags behind best practice in recovering debt. For example, it does not risk score its debtors. Risk scoring would allow it to tailor the help it gives to those who do not understand their obligations or are in financial crisis, while dealing promptly with debtors who deliberately pay late. HMRC is also unable to automatically link debts owed on different taxes by the same taxpayer. In managing tax debt, HMRC must balance the need to maximise revenue for the Exchequer with that of offering support to individuals and businesses in temporary financial difficulty. Balancing these objectives becomes more difficult in a recession. Since launching the Business Payment Support Service in November 2008, HMRC had - by February 2009 - agreed over 60,000 'time to pay' arrangements with individual businesses, worth £1 billion in deferred tax.

Filing VAT and company tax returns
Filing VAT and company tax returns

Author: Great Britain: National Audit Office

Publisher: The Stationery Office

Published: 2006-12-13

Total Pages: 44

ISBN-13: 9780102944020

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Value Added Tax (VAT) and Corporation Tax raised around £120 billion in revenue in 2005-06. Some 1.8 million businesses are registered for VAT and 1.8 million companies registered to file Company Tax returns, which cover their liability for Corporation Tax. This report examines the performance of HM Revenue & Customs in securing and processing VAT and Company Tax returns from businesses which should submit them. It covers: getting the returns in on time; efficiency in dealing with the returns; customer service and the compliance burden on businesses making returns. Over the last three years the number of Company Tax returns filed on time has remained broadly stable at 77 to 79 per cent and VAT return compliance rate has stabilised at 85 per cent. The Department does not have readily available information on the total number of Company Tax returns outstanding from all previous years. It also does not know the potential tax liability arising from all missing returns. At least £1.5 billion of tax is in doubt from late and non-filed VAT and Company Tax returns. The level and the way in which penalties are applied for late filing for the two tax returns has not proved effective in further improving compliance. The report finds online filing of returns could improve efficiency, and welcomes reduction in staff costs and improvements in customer service. The NAO make a number of recommendations, which may be implemented quickly and at low cost, aimed at yielding efficiency savings, reduce tax at risk, and improve the Department's progress towards its targets.

The BBC's management of risk
The BBC's management of risk

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

Published: 2007-12-06

Total Pages: 40

ISBN-13: 9780215037640

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This Committee of Public Accounts report on "The BBC's management of risk", sets out a number of recommendations on dealing with risk, and what the BBC's Executive Board should implement. Risk comes in different forms, from the risk of damaging the Corporation's reputation as a public service broadcaster to personal risk staff can experience when reporting from dangerous parts of the world. This report follows on from a National Audit Office report of the same title, and is available from the NAO website: http://www.bbcgovernorsarchive.co.uk/docs/reviews/nao_riskmanagement.pdf. Among the recommendations are: that BBC guidance needs a clearer delineation of responsibilities for risk management; that the main themes of risk management are not aligned with corporate objectives; that the BBC should update its assessments of the risks of working in hostile environments, as the abduction of journalist Alan Johnson showed; by failing to comply with its own Broadcasting Code, the BBC was fined by Ofcom over the a live phone-in competition on Blue Peter, and illustrates that some programme makers are ignoring the BBC's own editorial guidelines, exposing the corporation to reputational risk; the BBC has not related its risk to corporate objectives or assigned all risks to named owners; that BBC managers at all levels are not sufficiently engaged in the management of risk; there is still no fully satisfactory regime under which the BBC is accountable to Parliament for the value for money with which it spends licence fee payers money.

Filing of VAT and company tax returns
Filing of VAT and company tax returns

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

Published: 2007-12-04

Total Pages: 40

ISBN-13: 9780215037602

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On the basis of a report by the Comptroller and Auditor General, this report examined HM Revenue and Customs on getting VAT and Company Tax returns in on time, encouraging businesses to file tax returns online. The Department spends over £9 million a year on processing nine million VAT and Company Tax returns but one in five Company Tax returns and one in seven VAT returns are filed late or not at all. The Department lacks information on businesses that repeatedly file late and the links between late filing and other forms of non-compliance. The penalty regimes are variable and the fixed rate penalties for Company tax are low and not routinely applied, so the Department should also look at non-financial incentives such as tax clearance certificates. Less than 10% of companies' use online filing and the Department does not expect to meet its target of getting 50% of VAT returns filed online by 2007-8 and plans for mandatory online filing for Company Tax have been put back to 2010. Online filing would save the Department most of its current processing costs and be cheaper for businesses. Additional plans to reduce the administrative burden of filing taxes are unlikely to be implemented before 2011.

Big science
Big science

Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts

Publisher: The Stationery Office

Published: 2007-11-13

Total Pages: 44

ISBN-13: 9780215037152

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Government invests in a range of large scientific facilities to support and develop the nation's science base, with over £860 million allocated since 2000 to construct 10 new large scientific projects. These programmes include: a Diamond Synchrotron (costing £383 million) to produce intense X-rays and shorter wavelength emissions for examining structures at molecular and atomic level; a new research ship, RRS James Cook, to conduct oceanographic and marine studies (a budget of £40 million); and a new Antarctic research station (with a budget of £34.7 million) for monitoring climate, ozone and space weather. Following on from a NAO report on this topic (HCP 153, session 2006-07, ISBN 9780102944198) published in January 2007, the Committee's report examines how large scientific facilities are delivered and the how their value is assessed. Findings include that the first two projects have been delivered largely to time and budget, but other projects still at an early stage are forecasting slippage, with five of the six most mature projects forecasting significant increases in the initial estimates for operating costs. Research Councils have not always sufficiently evaluated options for locating new scientific facilities and have had difficulty in attracting a sufficient number of bidders for contracts to help build new facilities. Performance indicators used by the Research Councils and project teams for monitoring the success of these facilities are not always sufficiently comprehensive or measurable, and if the UK is to maximise the value of these facilities, it needs to attract more young people into science to make good use of the research capacity now being built.