The Year in Tax - 2021

January

• HMRC announces that late-filing penalties for self-assessment will be waived for returns filed before 1 March 2021.
• TV’s Graham Norton says celebrities who avoid tax should be made social outcasts, saying: “If everyone pays their tax, there are nice roads, neighbourhoods are safer, children are well educated”. (link)
  
  

• Importers face ‘substantial difficulties’ at UK ports after the post-Brexit transition period ends. (link)
• The Mayor of London calls on the Government to impose a tax on builders and developers to pay for cladding remediation work. Sadiq Khan said a one-off levy on around 10 per cent of profit would be enough. (link)
• The level at which the high-income child benefit charge kicks in should be increased so that basic-rate taxpayers do not have to start paying, says LITRG. (link)

February

• HM Treasury says it is looking at options for an online sales tax to 'shift the balance' between online and bricks and mortar businesses. (link)
  
  

• The National Audit Office (NAO) says that 'too little is known' by HMRC and the Treasury about the impact of its tax policies on the environment. (link)
  
  

• The Supreme Court rules that Uber must classify its drivers as workers rather than self-employed. (link)
• This month we learn that the Stamp Duty Land Tax (SDLT) holiday has cost the Government more than half a billion pounds in lost revenue. (link)
• A government spokesman says the Government has no plans to introduce the kind of proportional property tax which is being pushed for by Fairer Share campaign. (link)
• Figures are published showing that the tax that HMRC has raised by resolving tax disputes through Alternative Dispute Resolution (ADR) has dropped by 40 per cent in the last year from £44.5 million to £26.6 million. (link)

March 

• UK Budget – Chancellor Rishi Sunak (photographed) announces Corporation Tax increase and a new ‘super-deduction’, along with personal allowance freeze. (link)
  
  

• The Treasury Select Committee publishes its Tax After Coronavirus report, emphasising the need for long-term reform as the country emerges from the pandemic. (link)
• Britain’s overseas territories top a list of the world’s most significant ‘tax havens’ ahead of Switzerland, the Netherlands and Luxembourg, according to the campaign group Tax Justice Network. (link)
• UK households bought 10 per cent less sugar through soft drinks in the year after the sugar tax was introduced by the Government, new research shows. (link)
• The Treasury publishes a raft of consultation papers as part of its first-ever ‘Tax Day’. It includes plans for people and small companies to pay income and corporate tax bills much earlier. (link)
• More than one in four small British exporters have stopped sending goods to the EU since the end of the Brexit transition period on 1 January because of new red tape, according to the Federation of Small Businesses. (link)

April

• CIOT and ICAS publish a ‘tax manifesto’ ahead of the 2021 Scottish Parliament election. (link)
  
  

• Amazon boss Jeff Bezos (photographed) says he supports raising taxes on US companies after US President Joe Biden claims the company pays too little in tax. (link)
• Welsh Labour says it will not raise Welsh rates of income tax until ‘at least’ the economic impact of coronavirus has passed. (link)
• In a letter to Financial Secretary Jesse Norman, 10 MPs ask for an extension of Social Investment Tax Relief (SITR) for five years, instead of the two years proposed. (link)
• HMRC admit a security breach has resulted in nearly 18,500 late filing penalty notices for 2019-20 being sent to the wrong address. (link)

May

• Kate Forbes (photographed) is reappointed Scottish Finance Secretary as the SNP is re-elected to government. Tom Arthur joins the government as Public Finance Minister (with responsibility for tax). (link)
  
  

• CIOT President Peter Rayney (photographed) speaks of his pride in the way the tax profession has reacted to the challenge of COVID-19 at the CIOT/ATT virtual Scottish Joint Presidents Luncheon.
• Around 48,000 ‘mini umbrella’ companies have been created in the past five years in a bid to reduce recruitment agencies’ tax and national insurance liabilities, according to a BBC investigation. (link)
• The OECD says that people should be paying more inheritance tax and that loopholes used by the wealthy to avoid the levy should be abolished. (link)
• A ‘Nanny State Index’ published by the think-tank IEA shows that the UK has higher levies on alcohol, tobacco, e-cigarettes and junk food than many of its neighbours on the continent. (link)
• BBC director-general Tim Davie is urged by more than 160 BBC local and network presenters to resolve the ‘ongoing catastrophe of IR35’. (link)
• Leading environmental economist Sir Dieter Helm gives this year’s CTA Address about environmental taxation and the role that tax and other carbon pricing mechanisms can play in helping the UK to meet commitments for reaching ‘net zero’. (link)

June

• G7 leaders reach a historic deal to ensure multinational companies pay more tax in the countries they do business. They agree in principle to a global minimum corporate tax rate of 15 per cent. (link)
  
  

• HMRC thanks members of the CIOT and other tax professionals for their help delivering coronavirus economic support schemes, saying the support ‘has been greatly appreciated’.
• HMRC have spent close to £7,000 of public money on flowers alone by way of apology to individuals for its own mistakes over the past five years, a newspaper reveals. (link)
• The US Treasury Department asks authorities to investigate tax records cited in a media report that showed some of America’s richest people paid little to no income taxes. (link)

July

• Over 300 years of tax history draw to a close as HMRC’s Stamp Duty press machines (photographed) are officially retired. (link)
  
  

• A cross-party group of 76 MPs urge the government to drop the loan charge, saying the levy will lead to thousands of bankruptcies. (link)
• Under OTS proposals, data from banks, investment firms and pension providers could feed directly into a digital tax portal where taxpayers could see their tax bills and claim reliefs automatically – which could end self-assessment. (link)
• In recognition of the contribution to tax education of the late Dr Tom O’Shea CTA (Fellow), CIOT announces that it is establishing a new Tom O’Shea prize for the best candidate sitting the ADIT EU Direct Tax module.

August

• The boss of one of the world’s biggest plant-based meat companies says he favours a tax on meat as a way of reducing consumption. (link)
• An investigation finds that just six UK employers were prosecuted for falling foul of minimum wage laws, despite HMRC finding more than 6,500 violations over a six-year period. (link)
  

• A group of MPs call for rules surrounding taxpayer confidentiality to be relaxed to improve corporate tax scrutiny. (link)
• HMRC confirm family investment companies are not tax avoidance vehicles after a review. (link)

September

• The Government announces plans for a Health and Social Care Levy to pay for care reforms and extra NHS investment. (link)
  
  

• Lucy Frazer MP is appointed Financial Secretary to the Treasury (photographed) in a government reshuffle. Helen Whately MP becomes Exchequer Secretary.
• It is revealed that the public reported 107,000 cases of potential tax evasion last year, despite HMRC’s hotline being closed for five months at the start of the pandemic. (link)
• HMRC offers a settlement to members of the film investment scheme Eclipse aimed at bringing closure to the long running and high contentious dispute. (link)
• Shadow Chancellor Rachel Reeves tells Labour Conference that she would freeze business rates – and cut bills for SMEs paid for an increase in the digital services tax (DST) – ahead of abolishing the regime completely. Reeves also pledges a ‘laser focus’ on improving efficiency in the tax system. (link)

October

• UK Autumn Budget proposes the simplification of alcohol duties and a new Residential Property Developer Tax. (link)
  
  

• The ‘Pandora Papers’ leak features almost 12 million files uncovering the financial affairs of hundreds of world leaders, politicians and celebrities. (link)
• The Land Registry has been flooded with complaints as property buyers face losing thousands of pounds in stamp duty savings and seeing purchases collapse due to delays at the Government's record office. (link)
• The supermarket Morrisons says it will continue to pay taxes in the UK, despite the incoming private equity owners using a Cayman Islands firm to operate the business. (link)
• HMRC issue a warning to individuals who have bought crypto assets that they will soon be issuing ‘nudge’ letters to encourage taxpayers to review their affairs. (link)
• The UK’s Diverted Profits Tax is described as a ‘total failure’ by the Labour Party as it is predicted by government officials that the tax will raise no money over the next six years. (link)

November

• The NAO reports tax revenues fell by 4.4 per cent due to the pandemic as government raced to provide support to businesses and workers impacted by lockdown restrictions. (link)
  
  

• Figures published by HMRC show that in 2020-21, the value of tax saved by people choosing to leave money to charity in their wills reached £1 billion for the first time. (link)
• A Financial Times editorial argues that the Government’s decision to reform alcohol duties represent a ‘sensible rationalisation’ of the regime. (link)
• Football clubs in England have racked up tax debts of £140 million-plus in the pandemic, it is claimed. (link)
• Mecca Bingo and Grosvenor Casinos owner Rank will receive a tax rebate of over £80 million after winning a legal battle on VAT paid on fixed-odds betting terminals. (link)

December

• Scottish and Welsh budgets propose no changes to income tax rates, but Scottish starter and basic rate bands will increase by inflation. Both consult on changes to devolved property taxes on second homes.
  
  

• The independent Fiscal Commission for Northern Ireland recommends powers over income tax, excise duties, Stamp Duty and Air Passenger Duty should be controlled by Stormont. (link)
• Un-policed and often unenforceable anti-corruption laws have made the UK the global money-laundering capital for a post-Soviet Union elite, claims Chatham House. (link)
• The BBC reports how Elon Musk, Jeff Bezos and other billionaires employ special strategies to reduce their income tax liabilities. The ‘Buy Borrow Die’ mantra is a common practice among many of the ‘ultra-wealthy’, say experts. (link)
  
  By Hamant Verma, CIOT Senior External Relations Officer