Integrating the operation of income tax and NIC
We believe the objectives of integration to be fair, but emphasise the need to consider equally the position of employers who are not in business and the impacts on individuals – whether employees, pensioners or the self-employed.
We put forward issues which are particularly relevant for individuals, such as the complexity of having different definitions of income for different purposes across government (that is, not just differences between income tax and NIC), and complications on the transition between working and retirement age (the line between which is becoming increasingly blurred).
We are concerned in particular that there is little evidence in this initial paper of self-employed issues being thoroughly considered and we stress the need to consider interactions with welfare reform.
Interactions with other reforms, such as the new statutory test for income tax residence and state pension changes, require thorough consideration in the full consultation process.
To see the full LITRG response please use the link below.
Contact: Kelly Sizer (please use form at http://www.litrg.org.uk/ContactUs)