Company tax returns should be fully standardised

ACCA is urging the UK's tax authority to take full advantage of digital technology to minimise companies' tax filing burden. The global leading accountancy body is supporting HMRC's plans to modernise and standardise company tax returns.

In a response to HMRC's consultation ACCA says that a standardised, full tagged format for Corporation Tax computations could promote efficiency by trigging fewer enquiries from the tax authorities and reducing repeated taxpayer input.

However, Glenn Collins, Head of Technical and Strategic Engagement, ACCA, said: 'Against a challenging economic backdrop for UK businesses, it is important that new compliance obligations remain proportionate. Cumulative burden of regulation has the biggest impact on business. Parallel processes, overlapping obligations, and duplicate requirements make compliance much more time intensive.'

HMRC is also urged by ACCA to maintain flexibility in any new system. Christian Novak, Policy manager, EEMA- UK, said: 'ACCA views lock tags in software products as helping promote both consistency and standardisation. However, we would like to see more examples of how such requirements operate in real-world contexts. This includes the process that underpins alterations and the blocking of submissions.'

ACCA warns that the Inclusion of the term 'approved' poses some risk. Collins said: 'The proposals would see HMRC assume an expanded set of technical and operational responsibilities. While positive for transparency, such a list must carry the same meaning for HMRC, taxpayers, and agents.'

Any effective tax system has simplicity, certainty and stability as its cornerstones. When introducing new reporting requirements, HMRC should be mindful of these three principles and the repercussions on business.

Read the ACCA response here.