Nothing in this profile is actualy true. Or is it? Who knows, who cares.
A withholding tax is normally based on the transaction value, eg like SDLT.
Anyhow its just "less rubbish" than trying to do your own CGT in year.
Far easier to do it how we have it now.
I was thinking mainly of property transactions to have a withholding tax to create a "trigger" for tax payer action. You would have to make it really simple, eg 10% of the sales price.
On shares its even more crazy to try and do real time CGT as they are often bought/sold several times a year, not to mention loss making stocks sold in March to offset gains in the same year.
What completely baffles me about this area, is how on earth you are supposed to know how much tax there is due?
A client with a gain may well also have a loss in the same year, but later on.
They may also be paying tax at different rate of CGT depending on their final gross.
How you can have an "real time" CGT system which is largely a secret, and simultaneously be assessed for tax on an annual basis is a mystery to me.
Its very ill thought out. It make a lot more sense to have a simple withholding tax, which then you can get a rebate on if you fill in a tax return/other return. THis would then alert the tax payer to the system, and provide a legitimate revenue stream other than what seems to be not much better than a scam on tax payers to raise penalties and interest by setting up impossible systems, and penalising you if you don't follow it.
@mark, so are we to assume your pilot consists of a single firm of accountants submitting presumably one or two returns?
I have made a small adjustment to our T&C's about emails not being encrypted.
There are probably 1000's of regulation we don't comply with, and this will be just another one.
That isnt the point. Banks are notorious for pulling loans and/or forcing you into factoring your debts or similar which is highly profitable for them. If they are using the data from your accounts software as an 'early alert' you could be strong armed down that route well before you have time to sort it out, or indeed in circumstances where you simply haven't booked in the revenue properly and you are showing (on paper) a massive loss which its just poor accounting.
I'm not sure if you have ever dealt with a failing business, but its a real battle to keep all the plates spinning and trying to exit with dignity and/or some cash. The one person you dont talk to is the bank if you have a loan as you will be out of business by the end of the day.
"For RBS, having its own software platform means it will be able to cross-sell additional services and conduct top-level assessments of business performance and risk."
now that is the scary bit, and why you should never EVER give your bank access to your raw accounting data.
How long will it be before banks are pulling loans from customers who's accounting is in a mess and looking like they are losing money when they are not?
The very last person you want to give raw data to is your bank.
So basically for the sole prac:
1. Don't worry about it
2. Make sure there is active consent on your T&C's rather than passive consent for email correspondance (ie they have to sign them, don't just forward them as you might for SA)
3. Make sure you do a proper disengagement letter
As an ex auditor, the whole set up stinks quite frankly.
its a very hard "so what do we do from here?" but I think the answer has to start at divorcing audit from "other work". Then you may then have to force those 'audit only' firms to split in two. It will take maybe 5 years for the old other halves to actually be separate and you have 8 'old' firms plus the next tier and you actually have a market place rather than an oligopoly.
Then once there, you can maybe go down Jon's route of proper independence with panel appointment for companies, with firms missing out on new appointments for (say) 6 months if they have a scandal so putting some real financial pain on not finding stuff, rather than the current incentive to just not look too hard.
The trouble is the only advisors government has is the very advisory that have a vested interest in it not happening.
Yes yes please sign me up to file 5 times a year and not once.