For hundreds of years the British tax year for individual taxpayers has run from 6 April to the following 5 April but this may be set to change given the Office of Tax Simplification (OTS) has confirmed it is investigating the merits of doing so.
Many other countries use 31 December including Ireland, USA, Germany and France. Having a year end that corresponds to the calendar year end certainly has a degree of logical appeal.
Another alternative would be 31 March, coincidentally AAT’s own financial year end, given this is widely used by many businesses and would mirror the UK financial year for government accounting. Again, there is logical appeal as it represents the end of the first calendar quarter.
Changing the tax year-end – have your say
AAT wants to hear your views on the idea of moving the tax year-end. We’d appreciate your response via this two-minute survey.
The OTS is looking at this issue from a tax simplification angle but will also consider the various implications of any change in other areas. For instance in relation to the payment of tax credits and state benefits and any financial and administrative implications for taxpayers, employers and accountants.
The proposals have generated a mixed reaction. For instance, the property industry has been quick to welcome the idea whilst Katharine Arthur, head of private clients at Hays Macintyre was less positive by stating, “A shift in date could pose a mammoth task for tax professionals, HMRC and members of the public alike, requiring a complete upheaval of the UK’s tax and payroll systems and software.”
So, with the OTS undertaking a high-level exploration and analysis of the benefits, costs and wider implications of such a change – for which it will publish a report later this Summer – AAT is keen to understand your views.
Please let us know by completing this very short two minute survey on the subject.
Phil Hall is AAT's Head of Public Affairs and Public Policy.