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John Jones
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John Jones
Oh come on. This is poor journalism and inaccurate to boot. First, HMRC, whose discussion documents I have actually read, are proposing to apply this onerous quarterly digital reporting burden to anyone with a GROSS INCOME or TURNOVER of £10,000 a year, not just to the "business income" of £10,000 stated here. The actual financial threshold is therefore much lower than this article says, and will ensnare far more people, because it takes revenue, or in the case of landlords total rentals, rather than actual profit or net income after all costs and deductions have been included. Put that way the scope of this dragnet becomes clear. It is designed to capture almost all self-employed workers (how many plumbers or gardeners will have turnovers of less than £10,000 a year, implying perhaps only £5,000-7,000 net income from their work after costs?). It will also capture even the landlord who has moved away with work and receives gross rent of £850 per month on his house. In other words, these proposals are very far from being a boon to the little guy but are a direct assult on him (the concession on cash-basis accounting is trivial and just a crude attempt to sweeten a very bitter pill). Second, maintaining digital accounts will become a legal obligation for all these people, as will checking them in with HMRC every 12 weeks. This is therefore going to place a huge new burden on your average local tradesman or small-time accidental landlord who in many cases won't hitherto have ever used accounting software. Gone will be the days when a simple spreadsheet or notebook was sufficient: HMRC are going to impose a requirement to buy and use sophisticated accounting software on large numbers of people who don't own companies, have no accounting or book-keeping expertise and who have never before needed to worry about such things because their operations are at such a low level. This is actually an attempt to use IT and the law in combination to force lots of the "little people" to maintain a much closer and tighter relationship with HMRC and so shake down even more tax out of them, all of this, of course, while governments continue to allow major multi-national corporates who game the tax system to get away with it.

From: John Jones 18 August 2016 17:57 PM

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