Economic Affairs Committee
Basis Period Reform and Uncertain Tax Treatments

2nd Report of Session 2021-22 - published 15 December 2021 - HL Paper 128

Summary

Chapter 1: Introduction

Background

Chapter 2: Basis Period Reform

What is a basis period and whom does it affect?

Box 1: Example to show how basis periods work in the early years of a business

The Finance Bill proposal

What consultation has there been?

Has the case for change been made?

Estimation and apportionment

Transitional provisions

Overlap relief

Impact on tax liabilities

Are taxpayers and HMRC ready for the change?

Proposed timetable for the change

Resources

Preparation for change: raising awareness

Preparation for change: software

How much will businesses have to pay?

Conclusions 19

Chapter 3: Uncertain Tax Treatment

Background

What consultation has there been?

Has the case for change been made?

Simplification of the tax system: the test of uncertainty

Are taxpayers and HMRC ready for the change?

Potential compliance burden for taxpayers

HMRC compliance burden and support for businesses

Use of draft guidance

Chapter 4: Common Themes

Failure to follow the Tax Policy Framework

Resourcing for implementation

Complexity and bureaucracy: impact on business

Summary of Conclusions and recommendations

Appendix 1: List of Members and declarations of interests

Appendix 2: List of witnesses

Appendix 3: Call for evidence

Evidence is published online at https://committees.parliament.uk/work/1491/draft-finance-bill-202122/publications/ and available for inspection at the Parliamentary Archives (020 7219 3074).

Q in footnotes refers to a question in oral evidence.





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