Tax simplification trial to begin next month

The coalition government's assault on red tape for business has continued today with the launch of a tax simplification trial.

Companies under the trial will face a single compliance process for enquiries across a range of different taxes.

According to a spokesman for HMRC, risk analysis for areas involved in the trial will be taken as an amalgamation of the various tax strands, including VAT, income tax, corporation tax and PAYE, rather than each area being looked at individually.

He said: "Where a risk is identified, businesses will be visited by one person to go over all elements, rather than a number of visits from different people."

HMRC said that by simplifying and standardising the process for compliance checks, it will not only make life easier for businesses, but also reduce costs.

The trials begin on 1 June and will run for six months in Reading and Slough, Newcastle, Warrington, York, Exeter, London Euston and Southampton, Cardiff, Belfast and Edinburgh and Dundee.

If successful it will be rolled out nationally from January 2012.

David Gauke, exchequer secretary to the Treasury, said: "We know that agents, individuals and businesses find some of HMRC’s current compliance practices drawn out and costly. A single compliance process could help HMRC improve the customer experience and reduce costs."

The government announced last month that it would be running a complete review of government red tape in the UK in a bid to save money for SME businesses and itself.