CIOT highlights data-gathering concerns

The CIOT has raised a number of practical considerations in response to HMRC’s consultation Improving the data HMRC collects from its customers:

• gathering additional data will create extra work for employers and businesses with little or no direct benefit to them and may also place an additional burden on HMRC if it is to collect data for the use of other government departments;
• extra data requirements for businesses are likely to increase complexity around tax compliance, contrary to the UK government’s intention of embedding tax simplification;
• significant legislative changes will be required to implement the data-gathering proposals, giving additional powers to HMRC and potentially widening the scope of information collected in the self-assessment tax return to cover non-tax matters;
• non-tax data required to be included in tax returns could be set out as a new category with a separate penalty regime for non-compliance, to ensure penalties are not charged for submitting incomplete tax returns where the additional data is missing; and
• any new requirements should be piloted before the introduction of a general requirement to provide the data.