Survey for landlords and the self-employed
Sep 12, 2019
Key Dates Personal Finance Tax
If you’re self employed, or you have rental income from residential property, then you may understand how difficult it can be to budget enough funds to pay your income tax bill. It’s been known to cause the failure of numerous business start-ups, whose owners don’t hold back enough money to pay their taxes when they’re due.
As part of a current project to simplify tax reporting and payment arrangements, the Office of Tax Simplification (OTS) has now released two surveys, one for landlords and one for small business owners, which aim to establish whether you would find it beneficial to know your tax liabilities.
Wide reaching implications
Questions covered in the small business questionnaire include how easy you find it to budget throughout the year to pay your tax bill, and whether regular reporting of income and expenses would make budgeting for your tax bill easier.
The outcome of these surveys could have a huge impact. Once the OTS has gathered people’s feedback on the current system and how it could be improved, they will be in a position to explore new solutions which could lead to enormous structural changes. We highly recommend that you complete the survey, and help provide as much evidence as possible. The responses are anonymous, and the survey closes very soon – at 11pm on Friday 20th September 2019.
PAYE as a solution
One option being considered by the OTS is the introduction of a kind of PAYE for the self-employed. This essentially means that the tax you owe would be deducted at source. So it could be that your engager or your bank deducts tax before they pay you. Or if you’re a landlord, tax could be deducted by the letting agent or AirBnB before they pay you. Complications could potentially occur if you also engage the self-employed, as well as earning a fee yourself.
Is change needed?
As well as asking questions about how you currently track your expenses and your tax liability, the survey asks what changes you’d like to see implemented, and whether you’d prefer your tax deduction to be a flat rate, or whether you’d like there to be some adjustment for expenses. There is also an open ended question asking what would make the whole annual income tax return process simpler for you.
It will be interesting to see what the outcome of these surveys will be, and what impact they may have on changes to personal tax law in the future. We’ll keep you updated as and when we hear, but in the meantime if you have any comments please feel free to get in touch.