OTS calls for overhaul of Personal Tax Accounts
The Office of Tax Simplification (OTS) has called for a revamp of HMRC’s Personal Tax Accounts (PTAs). In order to make them easier to use for taxpayers.
In a new report, the OTS suggested merging Personal Tax Accounts and Business Tax Accounts (BTAs). Thus, allowing taxpayers to view information about their different types of income separately in one place. The merging of the two types of account would form a new tax account. With the OTS is calling the Individual Tax Account.
In the report, the OTS stated that the government should ‘explore the potential for HMRC to offer a fully integrated Individual Tax Account. Providing an end-to-end tax reporting and payment service’.
Furthermore, according to the OTS, Individual Tax Accounts would offer taxpayers a ‘running calculation of the additional tax, that the individual may be required to pay in relation to the year to date’. This calculation would be generated by looking at the information held in the Individual Tax Account.
‘The key recommendation in this report is for HMRC to continue its work on the PTA further, to enhance its capabilities and integrate it with the BTA,’ said Bill Dodwell, Tax Director at the OTS.
Previous work from the OTS has established that many self-employed taxpayers want additional help in reporting and paying tax. In some sectors, third-party reporting could help. Further in-depth work is needed to test this and potentially develop a workable plan.