Navigating the complexities of the UK tax system can be a daunting task for businesses. This year, the Administrative Burdens Advisory Board (ABAB) released its highly anticipated 2024 annual report, providing valuable insights into improving tax administration and addressing challenges faced by small businesses. At The Infinity Group, we believe understanding these updates is key to staying compliant and fostering business growth. Here’s a breakdown of ABAB’s priorities and what they mean for your business.
1. Modernising and Reforming HMRC
ABAB commended HMRC for its progress with Making Tax Digital for Income Tax Self-Assessment (MTD ITSA), noting that early engagement has resulted in meaningful changes. However, there’s room for improvement in raising awareness about MTD ITSA among businesses. The board envisions a future where tax systems are centred around taxpayers through a concept known as Tax Administration 3.0.
Despite these advancements, ABAB raised concerns about proposed reporting requirements for employee hours. This mandate, postponed until 2026, risks overburdening businesses by coinciding with the rollout of MTD ITSA and other reforms. For businesses, staying informed about these developments and planning ahead will be critical to managing compliance effectively.
2. Improving Day-to-Day Performance
Customer service remains a pain point in HMRC operations, with low satisfaction rates for both telephone and webchat services. ABAB emphasised the need for better digital solutions and a more responsive support system to reduce frustration among businesses.
For employers and payroll professionals, delays in addressing queries can lead to costly errors and non-compliance risks. Partnering with a reliable payroll provider like The Infinity Group ensures your business has expert support to navigate these challenges seamlessly.
3. Closing the Tax Gap
One of ABAB’s long-standing advocacies is payrolling of benefits, which streamlines reporting processes for businesses and HMRC alike. However, the board cautioned against implementing this mandate until at least 18 months after publishing reporting requirements. The soft-landing approach for loans and accommodation benefits also raised concerns about additional year-end burdens for businesses.
For small and medium-sized enterprises (SMEs), understanding these developments can be overwhelming. The Infinity Group’s tailored services help businesses simplify benefit payrolling and stay ahead of compliance requirements without added stress.
What Does This Mean for Your Business?
ABAB’s report highlights the ongoing reforms and challenges in the UK tax system, emphasising the need for businesses to adapt to changes while focusing on their core operations. At The Infinity Group, we offer expert payroll and tax management solutions to ensure you remain compliant, efficient, and ready to face the future of tax administration.
Partner with us to simplify your tax and payroll processes, minimise administrative burdens, and focus on growing your business. Contact us today to learn more about how we can help.