The self-employed could be forced to pay taxes in the same way as most workers, tax loopholes for second homes will be closed, and green taxes for frequent flyers will rise, all under a raft of new proposals from HM Treasury.
The new ‘Tax Day’ proposals, some 30 in all, aim to close some of the £31 billion tax gap.
Self-employed workers could be forced to pay their taxes on a monthly basis. The government feels that it could tax the self-employed in real time, as they earn, in the same way as PAYE employees. This would reduce errors and make it harder for the tax cheats.
Another consultation will reform the air passenger duty, which would mean those flying the farthest will pay the most. So, in effect, the government is working on the “polluter pays principle”.
Second home owners will also be policed more strictly. If they are using them as a holiday let then these have to be genuine – owners will not be able to get out of paying taxes by saying the property is ‘available’ to let, but has never actually been let out.
The government is also considering whether tax advisers should be required to hold professional indemnity insurance to help raise standards. They are also looking for a definition of ‘tax advice’.