Market leading insight for tax experts
View online issue

OTS report on tax for individuals at key life events

printer Mail

The OTS has published a new report, making 15 recommendations aimed at simplifying the tax system for individuals in areas such as family life and high-income child benefit charge, PAYE when in work, pension reliefs and charges, helping those with lesser capacity, and improving tax education.

The report’s recommendations fall under the following headings.

Family life:

  • review administrative arrangements linked to the operation of child benefit;
  • consider restoring national insurance credits to people who have lost out through not claiming child benefit;
  • consider how to ease the process of enabling children of those who have not claimed child benefit to receive their National Insurance number; and
  • work with the Government Digital Service to improve the visibility of guidance for non-commercial employers and maintain the basic PAYE tools to meet their needs.

Being in work:

  • consider practical issues in connection with starting work, changing jobs, taking on additional jobs and claiming expenses as part of HMRC’s ongoing work to improve the operation of PAYE.

Saving for a pension:

  • consider reducing or removing the differences in outcomes between net pay and relief at source schemes for people whose income is below the personal allowance;
  • ensure guidance on the tax consequences of particular pension arrangements and choices is available and clear to all concerned;
  • review the annual allowance and lifetime allowances against their policy objectives, taking account of distortions they sometimes produce (such as those affecting the NHS); and
  • review operation of the money purchase annual allowance, considering whether it meets its policy objectives, is set at the right level and is sufficiently understood.

Later life:

  • improve explanatory notes provided with tax coding notices issued when people first receive the state pension, or another pension;
  • explore the potential for developing automated checks or other tools for ‘designing out’ errors such as the allocation of ‘K-codes’ to smaller PAYE sources; and
  • review the current series of forms issued once a death has been notified through ‘tell us once’ and consider how HMRC could work more effectively with personal representatives to gain a complete view of the tax affairs of the deceased person and the survivor.

Helping others:

  • integrate and improve HMRC’s various sources of guidance for those helping others, including agents and those with powers of attorney.

    Tax education and awareness:

  • more collaboration between HMRC and relevant external bodies, including schools and in further and higher education, seeking to improve the public’s understanding of tax and finance; and
  • extend collaboration with academic researchers to quantify the effect of HMRC’s tax education programme.


Issue: 1461
Categories: News