Let’s hope that Philip Hammond has a few more “simplification” changes up his sleeve. The abolition of the March budget is a sensible reform. It allows for discussion and amendments to Finance Bills in good time for their implementation on the following 6 April.
More importantly, the budget will be presented before the SA filing deadline – or as we are led to believe – before the Making Tax Digital (MTD) annual review (for the self-employed) following the end of the 2018-19 tax year.
It will be interesting to see if the Office for Tax Simplification (OTS) continues to influence future tax legislation. The cash basis for accounting seems to be gaining traction as is the discussion on the scope and detail of MTD. They do seem to bow to the feedback from consultation. One prospective OTS idea was to tax the shareholders of small companies on a “look-through” basis. i.e. Corporation Tax would be abandoned and company profits would be taxed at Income Tax rates as if distributed to the shareholders. Needless to say the profession were not impressed, and OTS have now backed down from this proposal as too complicated to enforce – they have also acknowledged that taxing undistributed profits is a sure-fire way to reduce investment.
Chancellor’s always seem to have one or two issues that are effective from the budget announcement date; usually plugging holes in the tax avoidance dam, but it would be good to have more time to consider the longer term effects of changing legislation, and adapt strategies for clients at a more leisurely pace.
I doubt that many tax professionals will miss the spring budget. This year they have had just 36 days to recover from the SA filing deadline before they have yet another raft of changes to assimilate. Go easy Philip, please…