The UK government committed to setting up an external working group on timely payment in response to the request for evidence of timely payment.
The group will collaborate on and co-design aspects of on-time payment policy and proof-of-concept of calculation throughout the year to collectively understand the impact and implications of on-time payment for different types of businesses and sectors and to identify potential remedial actions. The Government will not proceed with any infra-annual calculation until it is satisfied that it can do so accurately and reliably.
Through participatory design, the group expects to develop policies and/or systems that support taxpayers and mitigate or minimize the impact of on-time payment.
The Government has pledged that no changes will be made to the payment deadlines in this Parliament, recognizing that this is a long-term goal.
The External Timely Payment Working Group, utilizing its diverse knowledge, experience and information resources, will:
This group only considers timely payment for taxpayers in self-assessment income tax and self-assessment corporate income tax for those not subject to the quarterly installment system.
While co-design will help shape aspects of proof-of-concept for in-year calculation and timely payment policy, ultimately the government will make policy decisions based on data and evidence to ensure policy outcomes suitable for a wide range of users, and to ensure the delivery of the broader tax management strategy through gradual modernization of the tax system.
First phase – the proof-of-concept of the calculation during the year
The design phase of the project will start in April 2022 and therefore the current priority is for the external working group on timely payment to contribute to the draft proof of concept for the calculation later in the year through the following topics:
- data requirements and procurement; to examine how we collect the data necessary to perform an annual calculation for a variety of business areas and models to ensure that we can test calculations in complex, real-world scenarios
- data acquisition; explore how to most efficiently ingest data in real-time and assess and mitigate the impact on data providers (third parties, intermediaries and taxpayers).
- accuracy of the calculation; to study how liability can be calculated accurately, including the reconciliation of allowances, rebates, dividends, etc. and expenses. It will also examine how best to reconcile multiple and seasonal/fluctuating incomes
- customer barriers and support; This topic examines what the customer experience with annual calculation will look like and potential barriers to its use, such as: B. digital exclusion. It examines how barriers can be broken down and how customers can best be supported to use the system easily and efficiently
- Interaction with other programs; This topic examines how the year-to-date calculation aligns with or affects broader government services and policies such as universal credit, government grants, tax digitization, COVID reimbursement, etc
Second phase – timely development of payment policy
The second phase addresses broader issues for the timely development of payment policies. It should be noted that the two phases are inseparable and the external working group on timely payment will work iteratively as the development and results of the proof-of-concept calculation throughout the year will support the sequencing and prioritization of the issues. The following are initial issues that the external working group on timely payments should consider:
- cash circulation; Assess the impact on different business sectors (including examining industry-specific influences, e.g. seasonal workers)
- administrative burden; Assessment of administrative burdens in various business areas, including represented and unrepresented companies
- vulnerable taxpayers; Assessing unique challenges such as interaction with DWP and the benefits system, digital exclusion, etc.
- a flexible on-time payment model; Assess the challenges of a unified approach to on-time payments and whether a more flexible system would be more appropriate (although this may introduce additional complexity)
structure and frequency
The external timely payment working group/subgroup meetings are held prior to any major learning or decision point for proof-of-concept design and delivery in the year to maximize opportunities for co-creation while minimizing the additional burden of stakeholders’ time ; We assume that this will be the case at least every 3 months.
Given the broad scope of on-time payment, and to ensure that expertise is used as efficiently as possible across the group, sub-groups are formed to work on specific issues or challenges in detail.
Establishing subgroups is an iterative process and reflects policy or system requirements as timely payment is developed. External Working Group on Timely Payment decides and agrees on sub-groups together, including defining goals and membership; The secretariat will draft terms of reference for each sub-group, which will be approved by the working group.
External Working Group Timely Payment:
- Chair: The external working group on timely payment is chaired by a senior official HMRC
- Secretariat: a secretariat will be provided by HMRC timely payment team
- Documents: Documents and agendas will be sent at least 3 working days before the meeting. The secretariat notes discussions and actions and makes a selection available to all members
- Chair: Each sub-group is chaired by a representative HMRC
- Secretariat: a secretariat will be provided by HMRC Timely payments team
- Documents: Documents and agenda will be sent at least 3 working days before the meeting. The secretariat notes discussions and actions and makes a selection available to all members
accountability and conduct
Accountability and Conduct:
- To support the goal of open discussion and to facilitate collaboration, our discussion is underpinned by the principles of the Chatham House Rule, as explained in more detail on the Chatham House website
- Where necessary, some contributions to the external Timely Payment Working Group and subgroups are kept strictly confidential to protect integrity HMRC and other systems of government. If necessary, this will be determined at the beginning of the session
- participants in the external working group on timely payment can use the information gained from the discussions for internal research and policy development purposes
- neither does the preparation of meeting reports HMRC, HMTnor will working group participants attribute comments or viewpoints to individual members of the external timely payment working group or its subgroups without first obtaining their permission
- HMRC do not conclude any commercial agreements with the participants. All commercial tenders are carried out according to the existing rules and laws
|An author with an interest in customer barriers and support|
|Chartered Accountants Ireland|
|Chartered Institute of Taxation|
|Department of Work and Pensions|
|Institute of certified accountants|
|Institute of Chartered Accountants in England and Wales|
|Low Income Tax Reform Group|
|National Farmers Union|
|Office for Tax Simplification|
|Tax policy advice|
|The Association of Control Engineers|
|The national and business association|
|The Association of Small Businesses|
|The Bar Association|