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Digital accounts will reduce the administrative burden of tax currently faced by millions of individuals and small businesses, according to the financial secretary to the Treasury, David Gauke.
Digital accounts will reduce the administrative burden of tax currently faced by millions of individuals and small businesses, according to the financial secretary to the Treasury, David Gauke.
The proposed system – announced in the Budget earlier this month – will bring together taxpayers’ details in one place to allow them to update their contact information, sign up for services including tax reliefs and the state pension forecast, and “understand quickly and easily what they need to pay”, says Gauke in the new HMRC guide Making Tax Easier: the End of the Tax Return.
The tax department intends to use its own data and that of third parties to populate accounts, which will be accessible from most digital devices with the aim of removing the need for millions of people to complete tax returns.
Businesses are to be offered the opportunity to share information with the Revenue in real-time by linking their accounting software to their online accounts.
“This is a big leap in modernising our tax system, putting good customer service at its heart, and making it as easy as possible… to pay the right tax at the right time,” Gauke adds.
Five million small firms and 10m individuals are set to be given digital accounts by early next year, with returns abolished by 2017 for people with simple tax affairs. All 55m taxpayers in the UK are expected to hold accounts by 2019/20.
Surely HMRC cannot expect sole traders, partnerships, rental income and expendituire figues, capital gains tax etc to be covered by real time "digital accounts"?