The CIOT and ATT have given a cool response to HMRC’s call for evidence on income tax self-assessment (ITSA) registration for the self-employed and landlords. As the CIOT response notes:
bringing forward the point at which the newly self-employed and landlords are required to identify themselves to HMRC will not necessarily foster ‘good tax habits’;
HMRC’s focus should be on public education, guidance, and improved processes, rather than making changes to the statutory obligation to notify;
the requirement to register with HMRC within six months from the end of the tax year in which a business starts up should remain unchanged; using the tax year as a reference point provides consistency, certainty and simplicity;
HMRC should consider clarifying its guidance on who needs to register for ITSA and ensure the guidance properly reflects the statutory obligation to notify;
HMRC should consider (and consult on) the potential interaction of any changes to the registration deadline with other parts of the ITSA framework;
a single system for taxpayers to register (and deregister) for different taxes, track the progress of applications and appoint one or more agents would be helpful, and HMRC should investigate how the Single Customer Account could be used; and
HMRC should consider how to raise public awareness of the requirement to register.
In its response, the ATT suggests that the registration rules should not be changed and that HMRC should instead focus on improving IT systems and processes.
The CIOT and ATT have given a cool response to HMRC’s call for evidence on income tax self-assessment (ITSA) registration for the self-employed and landlords. As the CIOT response notes:
bringing forward the point at which the newly self-employed and landlords are required to identify themselves to HMRC will not necessarily foster ‘good tax habits’;
HMRC’s focus should be on public education, guidance, and improved processes, rather than making changes to the statutory obligation to notify;
the requirement to register with HMRC within six months from the end of the tax year in which a business starts up should remain unchanged; using the tax year as a reference point provides consistency, certainty and simplicity;
HMRC should consider clarifying its guidance on who needs to register for ITSA and ensure the guidance properly reflects the statutory obligation to notify;
HMRC should consider (and consult on) the potential interaction of any changes to the registration deadline with other parts of the ITSA framework;
a single system for taxpayers to register (and deregister) for different taxes, track the progress of applications and appoint one or more agents would be helpful, and HMRC should investigate how the Single Customer Account could be used; and
HMRC should consider how to raise public awareness of the requirement to register.
In its response, the ATT suggests that the registration rules should not be changed and that HMRC should instead focus on improving IT systems and processes.
