COVID-19 is likely to further spur the global trend towards tax digitalisation. David Lyford-Smith from ICAEW’s Tech Faculty considers changes that will help automate processes to make them more efficient and points to ongoing challenges, such as digital exclusion.
The coronavirus pandemic has placed a massive challenge in the path of tax authorities globally. They have had to continue with business as usual during the crisis while managing additional work and support schemes within short timescales, explains David Lyford-Smith, a technical manager with ICAEW’s Tech Faculty.
In some instances, the pandemic has led to process adjustments and deadline extensions. For example, in March 2020, HMRC in the UK allowed businesses participating in Making Tax Digital (MTD) for VAT more time to implement digital links in their recordkeeping.
A glance across the Atlantic would show Sunak what real tax reform looks like
Joe Biden is about to shake up US taxation policy. The UK must hope that the chancellor feels a need to emulate him
Joe Biden proposes to almost double the rate of tax on investment gains. Photograph: Getty Images
Joe Biden proposes to almost double the rate of tax on investment gains. Photograph: Getty Images
Sun 25 Apr 2021 02.00 EDT
The differences couldn’t be more stark. Promises to “build back better” from Covid-19 have been made on both sides of the Atlantic. But as lockdown measures are steadily relaxed, President Joe Biden is showing far greater ambition than Boris Johnson’s government when it comes to shaping the post-pandemic recovery.
Last modified on Fri 23 Apr 2021 08.12 EDT
Speculators in Bitcoin have been left nursing heavy losses after reports Joe Biden is planning to raise taxes on the wealthiest Americans to tackle inequality and finance trillions of dollars in higher social spending.
The cryptocurrency price fell more than 6% to below $50,000 (£36,000) a bitcoin, hitting the lowest level since early March, as the White House puts the finishing touches on plans to almost double the rate of capital gains tax for rich individuals.
For those earning $1m or more, the tax on investment income would rise to 39.6%, up from a current rate of 20%, as part of plans expected to be announced next week. A 3.8% tax on investment income used to fund Obamacare would also be kept in place, meaning the new top rate would be as high as 43.4%.
Highlights from the broader tax news week ending 21 April, which includes an update from the Office for Tax Simplification on how HMRC is meeting its 2018 recommendations on guidance for taxpayers, as well as the latest editions of HMRC s Agent Update and Employer Bulletin.
HMRC makes ‘clear progress’ on guidance for taxpayers
The Office for Tax Simplification (OTS) has published a paper examining how HMRC is performing against 12 OTS recommendations to improve guidance for taxpayers published in 2018. In the new paper, the OTS acknowledges that HMRC has made “clear progress in implementing the new guidance model” that the OTS envisaged in 2018. It confirms that HMRC has committed significant resources to its guidance team and is making extensive use of external feedback to improve guidance. It concludes by looking to HMRC’s future plans and encourages the allocation of further resources. Read the report in full.
ACA calls for tax changes to be realistic, manageable and proportionate for schemes
The ACA has called for sensible initiatives to simplify the processes of the pensions tax system.
The Association of Consulting Actuaries (ACA) has called for sensible initiatives to simplify the processes of the pensions tax system.
In its response to the Office of Tax Simplification s (OTS) January call for evidence on its third-party data reporting review - published today (15 April) - the ACA said the Treasury arm had to make it easier for pension savers to accumulate wealth for retirement.
The ACA has long called for a fairer overview of pensions tax on behalf of its adviser member body, who provide advice to the providers of workplace schemes and their sponsors.