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| Tax return that takes just 5mins to fill in http://www.taxi-driver.co.uk/phpBB2/viewtopic.php?f=2&t=16351 |
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| Author: | Brummie Cabbie [ Tue Mar 15, 2011 10:51 pm ] |
| Post subject: | Tax return that takes just 5mins to fill in |
Although Admin might deem the following article as rightfully belonging in the Administration section, I have nevertheless posted it in the News section as it is an article of News that will affect us all, if it comes into being. Tax return that takes just 5mins to fill in 13 March 2011 Britain's 2m smallest businesses could fill in their annual tax form in fewer than five minutes under radical proposals from a Whitehall task force. They would pay a flat tax on their takings minus a fixed allowance for costs if the Chancellor accepts the suggestions of the Office of Tax Simplification (OTS). At a stroke, a huge amount of form filling would be abolished and the self-employed would enjoy one of the most uncomplicated tax regimes in the world. Other proposals in the OTS report would see the progressive merger of the income tax and National Insurance systems and an overhaul of the controversial IR35 tax rule that seeks to stamp out tax avoidance by those pretending to be contractors when they are employees in all but name. This is an interim report from the OTS, which is likely to be asked by Chancellor George Osborne to explore further some of the ideas. For the 2m smallest businesses - mainly the self-employed and partnerships - the report suggests a flat charge based on their cash book, with a fixed allowance for costs. The need for detailed record keeping would end. This is a sharply different attitude from that of Revenue & Customs, which has been consulting on a crackdown on poor record keeping by small and medium-sized enterprises. Elsewhere, the report stops short of calling for the abolition of IR35, but wants it reformed. The rule is thought to have brought in just £9m since it was imposed in 1999, but to have cost about £70m to administer. The target for IR35 is the abuse of the self-employed tax status by people who are, in effect, employees. But this has caught genuinely independent operators in sectors such as technology and the oil industry who, while working on one-off projects, are attached to a company for six months or more. OTS tax director John Whiting says: 'It should be possible to draw up a checklist that would tell someone whether or not they counted as selfemployed.' Simply abolishing IR35 is not thought to be an option because the OTS believes it addresses what is, in some cases, a genuine problem. The proposal to merge income tax and National Insurance is radical, but suggests moving in stages. This would begin by aligning the definitions of income that is subject to the two levies, then harmonising the collection period and then abolishing the socalled contributory principle, under which entitlement to some welfare benefits is linked to National Insurance contributions. After that, the OTS suggests abolishing National Insurance as paid by the self-employed and finally a complete merger of the two systems. Officially, this merger would apply only to small businesses, but it is hard to see how the old system could be preserved for larger firms. Source; http://www.thisismoney.co.uk/work/small ... page_id=10 |
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| Author: | wannabeeahack [ Wed Mar 16, 2011 12:38 am ] |
| Post subject: | |
why would anyone prefer a 5 minute tax return and get taxed on a flat rate for the sum "takings less costs" as against a 10 minute tax return and get taxed on "nett/taxable profits less allowances (personal+capital)" beware the ides of march (15th) |
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| Author: | wannabeeahack [ Wed Mar 16, 2011 12:40 am ] |
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BTW, HMG will never abolish N.I. unless they add MORE than its worth onto income tax, and that will be the end of the LibCons for sure |
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| Author: | Brummie Cabbie [ Wed Mar 16, 2011 7:01 am ] |
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wannabeeahack wrote: why would anyone prefer a 5 minute tax return and get taxed on a flat rate for the sum "takings less costs" as against a 10 minute tax return and get taxed on "nett/taxable profits less allowances (personal+capital)"
beware the ides of march (15th) The way I read it, you wouldn't have a choice. You would have to do it the HMRC way; 'takings less costs'!! |
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| Author: | Sussex [ Wed Mar 16, 2011 8:13 am ] |
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I suppose it will come down to the issue of will we pay more. If yes we wont support it, if no then we will. |
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| Author: | toots [ Wed Mar 16, 2011 11:59 am ] |
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Brummie Cab wrote: You would have to do it the HMRC way; 'takings less costs'!!
I guess the problem will arise when they decide what amount is reasonable for costs and how fixed are they with fuel ever increasing and different vehicles attaining different MPG. Not to mention the initial outlay when somebody purchases a vehicle. It is effectively already 'takings less expenditure' anyway |
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| Author: | wannabeeahack [ Wed Mar 16, 2011 12:40 pm ] |
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cant wait to see what they decide the rate should be when i joined the flat rate vat scheme i could charge the 17.5% per invoice and hand over 4% of the vat-inc invoice total (for year one) they soon stopped that! |
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| Author: | grandad [ Wed Mar 16, 2011 2:32 pm ] |
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wannabeeahack wrote: cant wait to see what they decide the rate should be
when i joined the flat rate vat scheme i could charge the 17.5% per invoice and hand over 4% of the vat-inc invoice total (for year one) they soon stopped that! Last I heard it was 9.5% when the VAT rate was 17.5% |
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