OTS small business income tax discussion paper – the LITRG response
We believe there is considerable merit in debating how to simplify income tax (and, in turn, class 4 National Insurance) for the smallest businesses and we therefore welcome this Office of Tax Simplification discussion paper.
Whilst we understand that the OTS’s remit is to focus on tax matters, this response stresses that any recommendations the OTS makes should also be considered by Government in the context of ‘in-work’ support for small self-employed businesses – currently via the tax credits scheme, but moving to Universal Credit in due course.
It would be preferable if any proposed changes were aligned so that the small trader does not have to report different incomes for their tax assessment and benefits claim, or follow different record-keeping requirements for the two schemes.
Furthermore, thorough guidance and support needs to be available to enable any new scheme to work.
LITRG’s full response can be read using the link LITRG response to OTS small business income tax discussion paper.
The discussion document itself can be found on the OTS section of the HM Treasury website.
Contact: Kelly Sizer (please use form at http://www.litrg.org.uk/ContactUs)