OTS recommends simplifications for small companies
Newsletter Issue - April 2016
The Office of Tax Simplification (OTS) has unveiled a package of recommendations aimed at making the tax system simpler and easier to use for small companies. The report, entitled Small company taxation review contains a mix of long range structural change ideas and simpler short term administrative improvements.
The recommended administrative changes include:
- aligning filing and payment dates, e.g. VAT and PAYE, and annual returns and corporation tax;
- HMRC providing extra support at weekends and evenings when more small company owners deal with their tax affairs;
- stopping companies providing the same information to various government departments who instead should share the information; and
- looking at the feasibility of having advance clearances for VAT.
The report sets out three main areas for further work:
- testing whether taxing the profits from the smallest companies on the shareholders rather than the company ('look-through') could be simpler for some companies as well as addressing distortions in the system;
- developing an outline for an new 'sole enterprise protected asset' (SEPA) vehicle which will give some limited liability protection without the need to formally incorporate; and
- simplifying the corporation tax computation, eliminating many sundry tax allowances and potentially calculating corporation tax on a cash basis for the smallest companies.
Tailored Advice For Your Business
We understand that no two businesses are the same, so we can tailor advice to suit your circumstances and business size. In this section you'll find guides and features for those businesses needing advice on how to manage company accounts, including cash flow management, late payment, bad debts and business tax...and much more
