{"id":4151,"date":"2021-06-10T15:10:20","date_gmt":"2021-06-10T15:10:20","guid":{"rendered":"https:\/\/www.bainesjewitt.co.uk\/blog\/?p=4151"},"modified":"2021-06-10T15:10:25","modified_gmt":"2021-06-10T15:10:25","slug":"ots-to-consider-benefits-and-implications-of-moving-tax-year-end-date","status":"publish","type":"post","link":"https:\/\/www.bainesjewitt.co.uk\/blog\/ots-to-consider-benefits-and-implications-of-moving-tax-year-end-date\/","title":{"rendered":"OTS to consider \u201cbenefits and implications\u201d of moving tax year end date"},"content":{"rendered":"<p>The Office for Tax Simplification (OTS) will explore whether there is a case for moving the UK\u2019s tax year end date.<\/p>\n<p><!--more--><\/p>\n<p><a href=\"https:\/\/assets.publishing.service.gov.uk\/government\/uploads\/system\/uploads\/attachment_data\/file\/991396\/Potential_for_moving_the_end_of_the_tax_year_-_Scoping_document_.pdf\">Announcing the review<\/a>, the office, which provides independent advice to HM Revenue &amp; Customs (HMRC), suggests that aligning the tax year end with the financial year end could reduce financial and administrative burdens for taxpayers.<\/p>\n<p>The UK\u2019s tax year end currently runs from 06 April to the following 05 April due to \u201chistorical reasons\u201d and has been the case for \u201chundreds of years\u201d, said the OTS.<\/p>\n<p>But most modern accounting systems used by businesses have been developed around month and quarter ends. For example, the two most popular accounting dates for multinationals are the calendar year end date of 31 December and 31 March. The UK financial year end for companies also runs from 1 April to 31 March.<\/p>\n<p>In the review, the OTS said it will explore the benefits, costs, and wider implications of moving the tax year end date from 5 April to 31 March \u2013 effectively shortening the first tax year under the change by five days.<\/p>\n<p>The review will also consider the impact of changing the tax year end date to 31 December \u2013 the day currently used by tax regimes including the USA, France, Germany, Ireland (who changed its year end date in 2002 after adopting the Euro), and even Jersey, a British dependency.<\/p>\n<p>The OTS said the outcome of the review will be published this summer and passed to HMRC for consideration.<\/p>\n<p>The announcement comes after the Institute of Chartered Accountants in England and Wales (ICAEW) <a href=\"https:\/\/www.icaew.com\/insights\/tax-news\/2021\/feb-2021\/its-time-to-take-a-look-at-the-tax-year-end\">suggested in February<\/a> that post-Covid recovery was a \u201cgood time\u201d to move away from the 05 April tax year end date.<\/p>\n<p>\u201cAlongside the government\u2019s stated desire to \u2018build back better\u2019, using the fundamental changes brought about by the coronavirus pandemic to rethink outmoded policies and business practices, the UK has a 10-year strategy to modernise its tax administration system, embracing digital technologies wherever possible,\u201d said the ICAEW\u2019s Anita Monteith.<\/p>\n<p>\u201cTo deliver these goals then some radical changes need to be made and shifting the end of the UK\u2019s tax year to 31 December could provide a way to not only simplify processes for taxpayers and the authorities, but also provide the benefit of international alignment.\u201d<\/p>\n<p>She added: \u201cIndividuals and businesses transact across borders all the time but it is unnecessarily cumbersome to have to deal with non-aligned tax jurisdictions. Added complexity means more time, more mistakes and generally increased compliance cost.\u201d<\/p>\n<p><strong>For help and advice with related matters, please get in touch with our expert team today.<\/strong><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Office for Tax Simplification (OTS) will explore whether there is a case for moving the UK\u2019s tax year end date.<\/p>\n","protected":false},"author":2,"featured_media":4153,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24,30,56,31,60,50,120,121,7,27,32],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4151"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=4151"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4151\/revisions"}],"predecessor-version":[{"id":4152,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4151\/revisions\/4152"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media\/4153"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=4151"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=4151"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=4151"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}