Consultation on Tax payments
A detailed consultation paper has been published by HMRC with proposals looking at improving the way taxpayers are able to pay tax due and in modernising the ability of HMRC to recover unpaid taxes.
Following the consultation changes are likely to be announced in the Budget and implemented through the 2009 Finance Bill. This consultation is part of wide ranging efforts by HMRC to modernise filing obligations and simplify interest rules.
The National Audit Office (NAO) and the Public Accounts Committee have recommended that HMRC should seek additional powers to assist in tax collection to encourage taxpayers to pay promptly and secure a cost-effective cash flow for the department.
HMRC are looking at helping individuals who submit Income Tax and Corporation Tax self assessment returns to make monthly payments to more evenly divide their annual liabilities. This payment instalment scheme would be voluntary but would be designed to be attractive to taxpayers.
The issue of tackling small debt is also being examined through using Pay As You Earn (PAYE) as an efficient way to collect ‘small’ debts from employees.