Interesting though basically logical and HMRC's approach is of course totally predictable.
Extending the thought process somewhat however, and moving away from the notion of an "influencer" as someone effectively looking to sell their ability to influence a market, what about the countless bloggers who just by way of example, perhaps broadcast Youtube videos of their stealth camping escapades?
Access to their output is free and, although there may well be an invitation to buy the perpetrator a "coffee", there is clearly no obligation whatever, so there is a case for perceiving such donations a gifts.
Clearly scale would potentially influence this interpretation but to get down to the basic badges of trade, what is the blogger's motivation? It could very reasonably be argued that it (whatever it might be) is his/her pass-time, and that the activity goes ahead and continues regardless of whether there is any audience or more to the point, regardless of whether or not, such audience as there may be, chooses to contribute a coffee or nothing.
At the same time, it is not difficult to imagine that certain of these performers might over time, attract a very wide audience of enthusiastic and generous coffee-doners, in which case the vexed question of where to draw the line, as between incidental income generated by a hobby, and the income of a trade, would no doubt need to be considered.
Frankly I see no harm in more frequent payments on account and, as I said earlier, I believe that this might well be welcomed by tax payers generally. They have only to pay once and for this to be by easier instalments would be no bad thing.
Again, as suggested earlier, this could simply be an variation of the existing system of payments on account. It does not need to be linked to any form of real time reporting, which we can only construe the dubious quarterly proposal to be intended to constitute as, if the contention were to be that this would somehow achieve greater in year accuracy, then the word delusional would need to be dusted off, and given a really good polish, in anticipation of its being called into use on a grand scale.
If the present proposals for quarterly reporting are genuinely expected to result in anything other than the last minute submission of very incomplete and inaccurate information, and/or failed compliance on a grand scale, then those harbouring such expectations are indeed delusional.
For my part, I am declined into the vale of years, but I none the less accept the inevitability of digitisation. Please however, let us not sacrifice all other considerations on this particular alter. Making all but the digitally excluded keep digital records and make digital submissions is an entirely reasonable goal but systems must be developed and fully tested first. If this latest postponement makes one resounding point, it is the folly of setting a starting date (or several) for a system that does not yet exist.
I very much hope that the threshold and the quarterly reporting proposition generally may yet be seen as the clumsy, cumbersome, and burdensome impositions that they would undoubtedly be, whilst the suggested benefits that might flow from them are, yes it is that word again, delusional, and one further point of principal that has concerned me throughout, is that to take the present system which, sensibly, consolidates individuals' affairs into a cohesive, single report, and replace it with an alternative that requires multiple individual reports for individual income sources, is surely a blatantly retrograde step from any and every perspective.
I sincerely hope that the opportunity will be taken, at Treasury level, for a very serious reconsideration of multiple, fundamental flaws that are manifest, and to be fair to the profession, to take some proper heed of all that was advised throughout the consultation process and been reiterated at every possible point since.
When all is said and done, it is we who know all about tax payers and their capabilities - we deal with them all day every day, while HMRC does not. And it is we who bridge the gaps between, and make the all too often, rickety systems work.
It has seemed that for far too long our collective, authoritative voice has been heard but not heeded, and that this has been almost a matter of principal, as though we are suspected of having a different agenda, when nothing could be further from the truth.
I think it fair to say that we would all ask for nothing much more in this regard, than a system that is fair, efficient and user friendly and that where there is change, that it is introduced in a measured and controlled fashion.
I have, along with most of the profession I am sure, long seen the hitherto stupidly low threshold for MTD ITSA and the need for quarterly reporting, especially amongst the smallest cases, as potentially chaotic; more to the point it appears to be without plausible justification.
If, as a good many have suggested, HMRC, or the Treasury's hidden agenda is in fact the later introduction of quarterly tax payments, then it really would be the proverbial "sledge hammer and peanut" routine. To achieve this, the only need would be a change to four payments on account rather than two, and to remove the £1000
de-minimus, a manoeuvre that might well suit a lot of taxpayers.
Ye gods and little fishes - we all new roughly what to expect but this surpasses even my wildest imaginings. If anyone is foolish enough to grant this any credence it will be a sad indictment of their faculties.
The whole is so utterly ludicrous as to merit not detailed analysis but one proposal does appeal; the removal of the proposed quarterly tax reporting for those beneath the VAT threshold. I am drafting a letter to Mr Corbyn, suggesting that if he would care to drop the entirety of his terrifying manifesto, with this one exception, he will be able to count on my vote!
Something a bit different - we decided for expedience, that wherever DD payment was not involve, we would use one of our email addresses as the contact address. So far so good, except that when the emails from HMRC, requesting confirmation arrived, three out of 4 were time expired within a little over 30 minutes.
Two questions for anyone who might know: what is the time limit? How do we try again if we have an expired link (we have 3 with no clues as to what to do next)?
Something a bit different - we decided for expedience, that wherever DD payment was not involve, we would use one of our email addresses as the contact address. So far so good, except that when the emails from HMRC, requesting confirmation arrived, three out of 4 were time expired within a little over 30 minutes.
Two questions for anyone who might know: what is the time limit? How do we try again if we have an expired link (we have 3 with no clues as to what to do next)?
I totally endorse K A's view. The ICAEW's "expertise" is once more exposed for what it is - totally out of touch with the real world of rank and file practitioners.
If this only resulted in naive or foolish suggestions, it would be regrettable but, sadly, as the perceived senior body representing the profession this poses a far more serious threat to us all as it is the same cloistered few, and/or their chums, who represent the entire profession at the high tables of HMRC and the Treasury, often to the near complete exclusion of the smaller bodies and thus to the exclusion of the voices and views of a very large swathe of hands on practitioners, i.e. those best placed to know, from bitter experience where the problems lie.
It is thus inevitable that far reaching change, often of the wholly impratical and ill conceived variety is visited upon us, despite the appearance of there having been consultation.
I, together I am sure with a good many of my peers, have long felt that the penalty system in its present guise, is far too often applied either disproportionately or inappropriately. As penalties are triggered automatically and mechanically, this is understandable but the counter balance of "reasonable excuse" has an entire department dedicated to rejection as its default position.
The costs of taking an appeal to the FTT are prohibitive in all but the most serious penalty cases and, because the penalties in question are not occasioned by any "enquiry" from HMRC, normal fee protection insurance cannot help, leaving an unquantifiable number being accepted as a matter of pragmatism.
What the consultative document gives away, perhaps, is that an equally unquantifiable number result only in HMRC incurring fruitless recovery costs and no penalty, as many of us already suspect.
The existing penalty framework is little understood whilst that which is proposed would be nothing short of incomprehensible to the lay person, presumably leaning further one of the most iniquitous aspects of our tax system - the totally unrealistic expectation that the UK taxpayer has a full working knowledge of the worlds longest and most complex tax code, any absence of which constitutes noe excuse, reasonable or otherwise. Oh for a level playing field!!
Yet more one sided legislation - just what we need, except that it is never for the benefit of either the taxpayer or the profession.
Whilst celebrating the Magna Carta's 800th birthday it might prove useful for the "State" to bear its raison d'etre in mind momentarily. We are not here to serve the tax system but rather the reverse (difficult though that is to believe) and the rule of law is there to regulate the excesses of the state and to see fair play, not to facilitate these latest circumventionalist tendancies.
65 is in sight and the Grey Havens beckon so why should I care?
Given that things have become a little fractious I will say at the outset that I do not profess any singular expertise in this matter, but neither does anyone else, and that perhaps is the difficulty.
The following, therefore, is my take upon the facts and figures that I have gleaned, thus far and I am quite prepared to be shot down in flames if needs be.
My understanding is that the 65,000 figure was offered up some months back as being the number of open enquiries/ appeals into individual cases using DOTAS registered schemes.
The 43,000 is the number of APNs being issued currently and therefore constitutes 43,000 of the total 65,000 cases already under scrutiny, as payment can only be accelerated if there is postponed tax already in the system.
The big question in my mind, and it may be that which most correspondents have been trying to pin down, is how many users of DOTAS schemes are there in total, if the 65,000 is only those already under enquiry or appeal?
Is the 65000 the merest tip of an imponderable iceburg, or has HMRC already taken on a sizeable tranche of the overall total in opening enquiries into 65000? My suspicion is the former rather than the latter. HMRC's computer must contain this data but I cannot re-call having seen anything explicit and there may be more than a little coyness where this is concerned.
Whatever the true statistics it remains the case that APNs and Follower Notices can only be used against cases already under enquiry or appeal so, in order for this new weaponary to be used to real effect, HMRC will still have to open enquiries into all of the rest, however many that may be, which is a prospect that does not appear to have been aired in public so far, possibly suggesting that the iceburg analogy is correct.
If this is the case, only the surface will be scratched until/unless a very much larger number of enquiries is opened, creating an even larger backlog, thus much exacerbating rather than resolving the problem. Perhaps this is the proposition that underlies the various lines of thought and reasoning in the banner article.
Call me old and foolish if you will - my friends do!
My answers
Interesting though basically logical and HMRC's approach is of course totally predictable.
Extending the thought process somewhat however, and moving away from the notion of an "influencer" as someone effectively looking to sell their ability to influence a market, what about the countless bloggers who just by way of example, perhaps broadcast Youtube videos of their stealth camping escapades?
Access to their output is free and, although there may well be an invitation to buy the perpetrator a "coffee", there is clearly no obligation whatever, so there is a case for perceiving such donations a gifts.
Clearly scale would potentially influence this interpretation but to get down to the basic badges of trade, what is the blogger's motivation? It could very reasonably be argued that it (whatever it might be) is his/her pass-time, and that the activity goes ahead and continues regardless of whether there is any audience or more to the point, regardless of whether or not, such audience as there may be, chooses to contribute a coffee or nothing.
At the same time, it is not difficult to imagine that certain of these performers might over time, attract a very wide audience of enthusiastic and generous coffee-doners, in which case the vexed question of where to draw the line, as between incidental income generated by a hobby, and the income of a trade, would no doubt need to be considered.
Ant thought anyone?
Frankly I see no harm in more frequent payments on account and, as I said earlier, I believe that this might well be welcomed by tax payers generally. They have only to pay once and for this to be by easier instalments would be no bad thing.
Again, as suggested earlier, this could simply be an variation of the existing system of payments on account. It does not need to be linked to any form of real time reporting, which we can only construe the dubious quarterly proposal to be intended to constitute as, if the contention were to be that this would somehow achieve greater in year accuracy, then the word delusional would need to be dusted off, and given a really good polish, in anticipation of its being called into use on a grand scale.
If the present proposals for quarterly reporting are genuinely expected to result in anything other than the last minute submission of very incomplete and inaccurate information, and/or failed compliance on a grand scale, then those harbouring such expectations are indeed delusional.
For my part, I am declined into the vale of years, but I none the less accept the inevitability of digitisation. Please however, let us not sacrifice all other considerations on this particular alter. Making all but the digitally excluded keep digital records and make digital submissions is an entirely reasonable goal but systems must be developed and fully tested first. If this latest postponement makes one resounding point, it is the folly of setting a starting date (or several) for a system that does not yet exist.
I very much hope that the threshold and the quarterly reporting proposition generally may yet be seen as the clumsy, cumbersome, and burdensome impositions that they would undoubtedly be, whilst the suggested benefits that might flow from them are, yes it is that word again, delusional, and one further point of principal that has concerned me throughout, is that to take the present system which, sensibly, consolidates individuals' affairs into a cohesive, single report, and replace it with an alternative that requires multiple individual reports for individual income sources, is surely a blatantly retrograde step from any and every perspective.
I sincerely hope that the opportunity will be taken, at Treasury level, for a very serious reconsideration of multiple, fundamental flaws that are manifest, and to be fair to the profession, to take some proper heed of all that was advised throughout the consultation process and been reiterated at every possible point since.
When all is said and done, it is we who know all about tax payers and their capabilities - we deal with them all day every day, while HMRC does not. And it is we who bridge the gaps between, and make the all too often, rickety systems work.
It has seemed that for far too long our collective, authoritative voice has been heard but not heeded, and that this has been almost a matter of principal, as though we are suspected of having a different agenda, when nothing could be further from the truth.
I think it fair to say that we would all ask for nothing much more in this regard, than a system that is fair, efficient and user friendly and that where there is change, that it is introduced in a measured and controlled fashion.
Or am I simply crying for the moon?
I have, along with most of the profession I am sure, long seen the hitherto stupidly low threshold for MTD ITSA and the need for quarterly reporting, especially amongst the smallest cases, as potentially chaotic; more to the point it appears to be without plausible justification.
If, as a good many have suggested, HMRC, or the Treasury's hidden agenda is in fact the later introduction of quarterly tax payments, then it really would be the proverbial "sledge hammer and peanut" routine. To achieve this, the only need would be a change to four payments on account rather than two, and to remove the £1000
de-minimus, a manoeuvre that might well suit a lot of taxpayers.
David Cox
Ye gods and little fishes - we all new roughly what to expect but this surpasses even my wildest imaginings. If anyone is foolish enough to grant this any credence it will be a sad indictment of their faculties.
The whole is so utterly ludicrous as to merit not detailed analysis but one proposal does appeal; the removal of the proposed quarterly tax reporting for those beneath the VAT threshold. I am drafting a letter to Mr Corbyn, suggesting that if he would care to drop the entirety of his terrifying manifesto, with this one exception, he will be able to count on my vote!
David Cox
Something a bit different - we decided for expedience, that wherever DD payment was not involve, we would use one of our email addresses as the contact address. So far so good, except that when the emails from HMRC, requesting confirmation arrived, three out of 4 were time expired within a little over 30 minutes.
Two questions for anyone who might know: what is the time limit? How do we try again if we have an expired link (we have 3 with no clues as to what to do next)?
David Cox
Something a bit different - we decided for expedience, that wherever DD payment was not involve, we would use one of our email addresses as the contact address. So far so good, except that when the emails from HMRC, requesting confirmation arrived, three out of 4 were time expired within a little over 30 minutes.
Two questions for anyone who might know: what is the time limit? How do we try again if we have an expired link (we have 3 with no clues as to what to do next)?
David Cox
Kent Accountant's view
I totally endorse K A's view. The ICAEW's "expertise" is once more exposed for what it is - totally out of touch with the real world of rank and file practitioners.
If this only resulted in naive or foolish suggestions, it would be regrettable but, sadly, as the perceived senior body representing the profession this poses a far more serious threat to us all as it is the same cloistered few, and/or their chums, who represent the entire profession at the high tables of HMRC and the Treasury, often to the near complete exclusion of the smaller bodies and thus to the exclusion of the voices and views of a very large swathe of hands on practitioners, i.e. those best placed to know, from bitter experience where the problems lie.
It is thus inevitable that far reaching change, often of the wholly impratical and ill conceived variety is visited upon us, despite the appearance of there having been consultation.
The consultation on the future of penalties
I, together I am sure with a good many of my peers, have long felt that the penalty system in its present guise, is far too often applied either disproportionately or inappropriately. As penalties are triggered automatically and mechanically, this is understandable but the counter balance of "reasonable excuse" has an entire department dedicated to rejection as its default position.
The costs of taking an appeal to the FTT are prohibitive in all but the most serious penalty cases and, because the penalties in question are not occasioned by any "enquiry" from HMRC, normal fee protection insurance cannot help, leaving an unquantifiable number being accepted as a matter of pragmatism.
What the consultative document gives away, perhaps, is that an equally unquantifiable number result only in HMRC incurring fruitless recovery costs and no penalty, as many of us already suspect.
The existing penalty framework is little understood whilst that which is proposed would be nothing short of incomprehensible to the lay person, presumably leaning further one of the most iniquitous aspects of our tax system - the totally unrealistic expectation that the UK taxpayer has a full working knowledge of the worlds longest and most complex tax code, any absence of which constitutes noe excuse, reasonable or otherwise. Oh for a level playing field!!
CoxE
Yet more one sided legislation - just what we need, except that it is never for the benefit of either the taxpayer or the profession.
Whilst celebrating the Magna Carta's 800th birthday it might prove useful for the "State" to bear its raison d'etre in mind momentarily. We are not here to serve the tax system but rather the reverse (difficult though that is to believe) and the rule of law is there to regulate the excesses of the state and to see fair play, not to facilitate these latest circumventionalist tendancies.
65 is in sight and the Grey Havens beckon so why should I care?
CoxE
The mystery of the DOTAS figures
Given that things have become a little fractious I will say at the outset that I do not profess any singular expertise in this matter, but neither does anyone else, and that perhaps is the difficulty.
The following, therefore, is my take upon the facts and figures that I have gleaned, thus far and I am quite prepared to be shot down in flames if needs be.
My understanding is that the 65,000 figure was offered up some months back as being the number of open enquiries/ appeals into individual cases using DOTAS registered schemes.
The 43,000 is the number of APNs being issued currently and therefore constitutes 43,000 of the total 65,000 cases already under scrutiny, as payment can only be accelerated if there is postponed tax already in the system.
The big question in my mind, and it may be that which most correspondents have been trying to pin down, is how many users of DOTAS schemes are there in total, if the 65,000 is only those already under enquiry or appeal?
Is the 65000 the merest tip of an imponderable iceburg, or has HMRC already taken on a sizeable tranche of the overall total in opening enquiries into 65000? My suspicion is the former rather than the latter. HMRC's computer must contain this data but I cannot re-call having seen anything explicit and there may be more than a little coyness where this is concerned.
Whatever the true statistics it remains the case that APNs and Follower Notices can only be used against cases already under enquiry or appeal so, in order for this new weaponary to be used to real effect, HMRC will still have to open enquiries into all of the rest, however many that may be, which is a prospect that does not appear to have been aired in public so far, possibly suggesting that the iceburg analogy is correct.
If this is the case, only the surface will be scratched until/unless a very much larger number of enquiries is opened, creating an even larger backlog, thus much exacerbating rather than resolving the problem. Perhaps this is the proposition that underlies the various lines of thought and reasoning in the banner article.
Call me old and foolish if you will - my friends do!