Ministers were pressed on the CIOT’s concerns over the enhanced Business Record Checks regime and the introduction of PAYE Real Time Information (RTI), at last week’s Conservative Conference in Manchester.
Business Record Checks
At a meeting organised by the thinktank Reform and R3, the insolvency trade body, George Crozier, the Institute’s External Relations Manager, told David Gauke, Exchequer Secretary to the Treasury, that the Institute was supportive of a lot of the Government’s reforms, such as improvements to the consultative process and the setting up of the Office of Tax Simplification, but was unhappy about HMRC’s programme of business record checks, which had recently been extended. While improving record keeping by business is necessary and important, said Crozier, the CIOT had two particular concerns about the programme. First they were concerned that it is a blunt instrument more about heavy-handed revenue-raising through fines, when it should be a collaborative process about educating business about good practice and supporting them in improving their systems. Secondly it was important that what counts as adequate records needs to have regard to the sort and size of business. Expecting the smallest businesses – which might only have one or two employees – to have perfect records kept up to date every day was unrealistic and not in keeping with the Government’s aim of reducing business burdens. He asked the minister to keep this area under review and to be willing to make changes.
Responding, Gauke said he was conscious of concerns about the programme. This is always something he would keep an eye on, he said, explaining that what HMRC was trying to do was to “get the balance right”. In the interests of fairness it was important that there is a level playing-field. The SME sector was important but a minority did not pay taxes as they should and this needed to be dealt with. However Mike Cherry, Policy Chairman of the Federation of Small Businesses, who was a member of the panel at the meeting, did not feel the minister’s attempts to sooth were sufficient. “We have a real problem here,” he explained: ‘adequate’ is a subjective word and there is nothing laid down by HMRC to give you the basics. He made a particular plea for HMRC to make the online VAT process easier. Gauke acknowledged that was a fair point.
Real Time Information
During a meeting at Manchester’s Palace Hotel, Iain Duncan Smith MP, Secretary of State for Work and Pensions, was questioned about a range of issues, particularly benefit reform and the introduction of Universal Credit.
- HMRC spot checks – is your business at risk? (simplybusiness.co.uk)
- Taxmen extend biz record check pilot (go.theregister.com)