25 Mar 2018

Self assessment and Making Tax Digital

07 March 2018

Standing at the crossroads


  • Self assessment changed the compliance landscape for taxpayers, agents and the Revenue.
  • Simple assessment has echoes of the P800 system.
  • Support from HMRC will be vital in the success of Making Tax Digital.
  • Are advisers ready for change?

On reading in Taxation that some 10.7 million people had submitted self-assessment tax returns for 2016-17 (‘Record numbers file online’, 8 February 2018), I realised that 31 January 2018 marked the 20th anniversary of the first filing date for this seemingly radical approach to revenue collection. My first reaction was one of astonished disbelief. Had I really survived so many manic Januarys and exhausted Februarys, only to emerge like a spring butterfly to begin all over again on 6 April? Time has distilled my experiences over 20 years into an overwhelming dread of new year’s day – not because of overindulgence but at the prospect of an overkill of client information processing to come.


Brave new tax system

Self assessment was massive when it was introduced. The legislation in FA 1994 changed the compliance landscape for individuals, trusts and partnerships and, with it, the lives of tax practitioners and Revenue staff alike.

The supporting guidance in HMRC’s publication SAT2 promised a ‘fairer and more straightforward system for people who receive tax returns’. By replacing the cumbersome assessment programme involving endless estimates and appeals, the self-assessment return would provide one vehicle through which the taxpayer would declare income and gains, claim allowances and reliefs, and calculate ...

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