Revenue news

Budget changes

As the 2003 Budget will take place after 6 April, the Revenue is asking employers and pension providers to put into effect any consequent changes to codes and tax tables on the first pay day after 14 June 2003, backdated to the start of the tax year.

Any revised notices of coding will be issued early in June, so employers should make any P6 pay-as-you-earn code changes on the first pay day after 14 June 2003.

Employers who have been sent new tax tables for 2003-04 (either as paper or in electronic form), should use them after 14 June 2003.

(Source: Inland Revenue news release dated 5 March 2003.)

Short tax return pilot

The Revenue will be piloting a new simplified four-page tax return, for people with straightforward tax affairs, in April 2003. The new form will be sent, instead of the usual return, to people selected on the basis of their last completed tax return. The types of taxpayers likely to qualify for a short return will include pensioners and low turnover self-employed people and employees, provided they have simple tax affairs.

The short return will contain no facility to self-assess, as the idea is to make the task of completing the form as straightforward as possible. The Revenue will encourage participants in the pilot to submit it by 30 September to ensure that they receive notification of any amount to pay in good time.

The Revenue is also planning to offer people an alternative option of filing their short tax return by telephone, using voice recognition software. It will also be possible to file online. Those receiving the new form will have the option of not taking part in the pilot, and requesting the usual return instead. Tax advisers may, also, prefer to use their standard software package to prepare a full return. The short tax return cannot be used by any person outside the pilot.

The pilot will involve a total of around 50,000 taxpayers from Centre 1, Belfast, Warwickshire Coventry and Wey Valley offices.

The Revenue will be evaluating the results of the pilot as the new returns are sent back. It is not expected that the new form would be available nationally before April 2005.

(Inland Revenue Working Together issue 12, February 2003.)

Schedule 1B claims

When giving relief for claims made under Schedule 1B to the Taxes Management Act 1970 (claims involving two or more years), the Revenue has previously restricted any repayment in order to retain an amount to cover any outstanding liability for the earlier year. It has done this regardless of whether that liability was already due or due in the future. (Tax Bulletin issued December 1996 covered this in more detail.)

However, following representations, the Revenue has decided to relax this position for claims to carry back losses and/or pension payments. Any automatic repayment will continue to be restricted to cover the earlier year (so avoiding the situation where a taxpayer receives a repayment from the Revenue and then has to pay it back at a later date). But if the earlier year's liability is not yet due, the Revenue will now consider making an additional repayment up to the total tax paid for the earlier year through the self assessment account, if specifically requested.

(Inland Revenue Working Together issue 12, February 2003.)

Enquiry manual

The Revenue has published its new Enquiry Manual that has been produced for its staff. It consolidates the existing Investigation Handbook and Enquiry Handbook which have been withdrawn.

The Enquiry Manual provides guidance on self assessment enquiries and related topics.

(www.inlandrevenue.gov.uk)

Corporate filing

The Revenue's directions authorising the use of the Internet corporation tax service for sending company tax returns to the Inland Revenue, are available on the Internet at www.inlandrevenue.gov.uk.

New leaflet

The Inland Revenue has published a new leaflet for non United Kingdom-resident contractors and subcontractors operating in the construction industry scheme. The leaflet gives advice on the scheme and also provides details of a central point of contact, at the Centre for Non Residents in Nottingham.

In addition, from 10 March 2003, non-resident companies that do not have a permanent establishment in the United Kingdom will be able to register for the construction industry scheme with the Centre for Non Residents, rather than with a local tax office.

(Source: Inland Revenue news release dated 10 March 2003.)

New conventions

Discussions at official level are to be held shortly about comprehensive double taxation conventions between the United Kingdom and Croatia, and between the United Kingdom and Serbia and Montenegro.

Representations are invited and should be sent, in each case, to: Ms Angelia Burke, Inland Revenue International, Victory House, 30-34 Kingsway, London WC2B 6ES, e-mail address: Angelia.Burke@ir.gsi.gov.uk.

(Source: Inland Revenue news release dated 7 March 2003.)

Changes on the board

The Inland Revenue on 10 March announced changes to the membership of its board, to take place from early April.

Having now done nearly five years as director general in the Inland Revenue, Tim Flesher has been appointed deputy chief of defence logistics at the Ministry of Defence, and will leave the Revenue on 11 April.

Tim's successor as director general, corporate services, will be Helen Ghosh. Helen has worked in various departments, including the then Department for the Environment, Transport and Rural Affairs and the Department for Work and Pensions. She is currently the director of the machinery of Government Secretariat in the Cabinet Office.

Dave Hartnett, director general, policy and technical, will become a deputy chairman from 14 April.

(Source: Inland Revenue news release dated 10 March 2003.)

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