Tax news in brief

More software for MTD ITSA

Dext has been added to HMRC’s list of software that works with Making Tax Digital for Income Tax Self Assessment (MTD ITSA), bringing the total number of software products to 11.

ICAEW recently provided an update on MTD ITSA, including:

• the government’s announcement that MTD ITSA will be extended to those with turnover of more than £20,000 by the end of this parliament; and
• a HMRC MTD ITSA event to be held in London on 5 December.

NAO suggests three ways to reduce the tax gap

In a recent report on the impact of fraud and error on public funds, the National Audit Office (NAO) has suggested that HMRC should take the following action in order to reduce the tax gap:

• it should ensure that it understands the impact of its compliance work so that it can target activities to bring in the most tax revenue;
• it should make it easier for taxpayers to comply and get help, so they pay the right amount of tax; and
• it should ensure that tax rules are soundly designed and easy to comply with, and evaluate and iterate rules as required.

ICAEW has published an article which explains what the tax gap is.

Changes to business rates

The Non-Domestic Rating (Multipliers and Private Schools) Bill has been introduced to the House of Commons. The Bill includes measures announced at the Autumn Budget on 30 October 2024, including:

• the introduction of new lower multipliers for qualifying retail, hospitality and leisure properties and higher multipliers for the high value properties; and
• the removal of eligibility for business rates charitable rate relief from private schools.

As business rates is devolved to the various nations of the United Kingdom, the measures concern England only.