HMRC may take all earnings and deduct tax centrally
Employers-HMRC are proposing they deduct tax themselves replacing the Pay As You Earn system (PAYE) after HM Revenue and Customs admitted billions of pounds are not being collected. How will it work? – all employees pay will go directly to the treasury where tax will be deducted and paid back to your employees. It’s reckoned that this will save you the cost of managing PAYE, around £500 billion, critics query that the cost of setting up a collection system would be out of this world and the track record of hacking and lost data would be devastating for everyone.
The HMRC track record of handling large computer systems has been miserable and has suffered high-profile errors with data. The system would be massive in terms of data management, larger than a recent attempt to centralise the National Health Service’ s data, which wa s later scrapped. Cyber crime could be a high risk factor if so much data was centralised and hacked, witness bogus emails from most major banks and also HMRC to consumers. The Institute of Directors (IoD) have also publicly voiced its concerns with such a proposed scheme. There has been no comment from the Chancellor of the Exchequer George Osborne.
