Compliance
Mutual Assistance
With effect from 1 January 2012 the UK will implement the Mutual Assistance Recovery Directive agreed by EU Finance Ministers during 2010. This will enable EU member states to provide each other with assistance in the recovery of tax debts and duties owed by individuals and businesses within the EU.
Time to pay
The Business Payment Support Service will continue to be available to provide advice and time to pay to viable businesses experiencing temporary financial difficulty. It is not clear whether this service will become any more helpful.
Disclosure of schemes
From 1 January 2011, five additional measures to improve the Disclosure of Tax Avoidance Schemes (DOTAS) regime took effect. These included changes to the hallmarks (the key features of a scheme that require its disclosure), the trigger point for disclosure and enhanced information powers affecting promoters and intermediaries.
Further changes to the hallmarks will follow in 2011-12 with the aim of increasing the number of schemes that require disclosure. The DOTAS regime is also being extended to include inheritance tax on the transfer of property into trust with effect from 6 April 2011.
The Government proposes to list in regulations certain tax avoidance schemes which are believed not to deliver the promised tax advantages. There will be statutory consequences of entering into these schemes designed to remove any cash flow advantage from delayed payment of the disputed tax liability through an additional late payment charge.
A consultation document will be issued in May 2011 with the intention of including legislation in Finance Bill 2012.
Review of powers
Finance Bill 2011 will include legislation allowing HMRC to make regulations to enable them to require a security from employers for PAYE and NIC that is at serious risk of non-payment. Not providing a security when one is required will be a criminal offence, but time to pay arrangements will be considered before a security is enforced.
