Statistics published by HM Revenue & Customs (HMRC) yesterday revealed a 15 per cent increase in the January 2019 self-assessment receipts when compared to those taken in January 2018.
Adding to the bumper revenues, capital gains tax (CGT) receipts were up by a fifth on the previous January, said leading accountancy, tax and advisory firm Blick Rothenberg.
Commenting on the data, Blick Rothenberg personal tax manager Paul Hayward-Schiefer said: “These are significant increases for January in both taxes, and although the overall picture during the year is not quite at this level, self-assessment receipts are still up 10.57 per cent and CGT up 11 per cent in the last 12 months overall. Given inflation has dropped to 1.8%, this is still impressive.
“To put it into actual figures, the tax take for these two taxes is £3bn more in January 2019 alone, than it was last January.”
Those who have to submit a self-assessment are typically higher earners (above £100,000), business owners, the self-employed, property investors and those with significant investment income. According to Blick Rothenberg, these people “quite often have more control over their income and gains”, compared to those who are just taxed under PAYE through employment.
“This means there are many possibilities for the increases in the income tax element, ranging from individuals taking dividends early, increased business profits, and of course HMRC’s restriction on mortgage interest relief for those with rental properties,” the firm said.
Haywood-Schiefer added: “In terms of capital gains tax, if you look deeper at the other statistics, UK residential property transactions were only 0.04 per cent up over the 2017/18 tax year, so that leads me to believe that more of the sales are related to shares rather than on properties, or at least if properties were being sold, these were long held investment properties leading to higher capital gains.
“CGT figures fluctuate in reaction to events (the CGT receipts in 2008/09 increased by over 2.5bn from 2007/08) so it is likely Brexit and the calling of the General Election had some impact on the figures as investors reacted to these.”
However, he acknowledged that the volume of self-assessment receipts could be a result of everyone submitting their returns “on time this year”.
“Although I doubt that, we won’t know the full picture until next month’s stats are released and we can see what has been paid late,” he concluded.
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