You’ll soon be able to report tax position on your iPhone

You’ll soon be able to report tax position on your iPhone

By the end of the next Parliament every individual and small business in the UK will have all their tax details available online, the government promised today (18 March), in a well trailed move to remove the burden of the end of year tax return.

Tax returns are to be replaced by digital tax accounts that will work just like an online bank account so that individuals can register for new services, update their information, and understand quickly and easily what they need to pay, according to the Budget.

HM Revenue & Customs confirmed it will automatically use the information it holds, along with new data from third parties, to populate the digital accounts.

Article continues after advert

Those who pay their tax through PAYE will have their income tax, national insurance contributions and pension position shown in their digital tax accounts, including any interest from banks and building societies.

Taxpayers will then simply be able to log-in to check and confirm that their details are complete and correct.

For businesses, HMRC and Companies House stated it will be streamlining the process to register a new company and sign up for a range of taxes by May 2017. According to HMRC this will remove the need for companies to provide the same information more than once.

David Gauke MP, financial secretary to the Treasury, said the digital accounts will be simple, secure, personalised to the taxpayer - and accessible through the digital device of their choice.

As time goes on, he added they will offer “more and more services” but he failed to reveal what these services would be.

Mr Gauke said: “This will be one of the biggest-ever changes to the way that people manage and pay their taxes.

“HMRC will make smarter use of the data it holds, linking it up in ways that weren’t previously possible, so that HMRC does more of the work that taxpayers currently have to do for themselves.

“In future, people will only need check their tax information online to know how much they owe. Millions of people will no longer have to complete a tax return at all — while those with more complex tax affairs will be able to use their account to declare income and pay tax in year.

“It will also be a major help for small businesses, which will be able to link their accounting software to their personalised tax account and have the option to pay as they go.

“This is a big leap in modernising our tax system, putting good customer service at its heart, and making it as easy as possible for individuals and businesses to pay the right tax at the right time. It signals the end of the tax return.”