Overview

The United Kingdom Corporate and Individual Tax and Financial Transparency Bill aims to increase transparency in corporate and individual finances. It mandates the disclosure of financial information by large companies, beneficial ownership details, and tax returns of high-income earners and large companies, enhancing tax compliance and combatting tax evasion.

Description

This bill introduces several key measures:

• Disclosure of Financial Information by Large Companies: Requires large companies to disclose detailed financial information about themselves and their related undertakings, including turnover, profit, tax liability, employee costs, and net assets. This information must be publicly accessible online.
• Disclosure of Taxation Information by Selected Large Companies: Mandates the publication of corporation tax returns for the top 250 UK companies, based on various criteria such as taxable profit, UK supplies (VAT), and employee income tax/national insurance contributions.
• Disclosure of Tax Returns of Selected Individuals: Requires the publication of tax returns for the 250 highest-income individuals in the UK, without anonymization.
• Disclosure of Beneficial Ownership of Companies: Strengthens existing requirements for companies to disclose beneficial ownership information to Companies House, lowering the threshold for reporting.
• Reporting Duties of Financial Institutions: Obliges UK financial institutions to report the opening and closing of company accounts, including beneficial ownership details, to both HM Revenue & Customs (HMRC) and Companies House.
• Companies House Duties: Imposes on Companies House a duty to publish beneficial ownership information and to refrain from dissolving companies that haven't met the new reporting requirements.
• HMRC Duties: Empowers HMRC to request tax returns and, in case of non-compliance, to obtain banking records and assess tax liability with joint personal liability for those named as having authority over the account or as beneficial owners.
• Crown Dependencies and British Overseas Territories Obligations: Extends certain provisions of the bill to these territories requiring similar disclosure of information, including beneficial ownership.
• Disclosure of Trust Information to HMRC: Requires registration of UK trusts with HMRC, including comprehensive information about the trust, its beneficiaries, and financial data; publication of certain trust information will be mandatory based on asset and income thresholds.

Government Spending

The bill involves expenditure from money provided by Parliament to cover the costs incurred by government departments and ministers in implementing and enforcing the new regulations. Specific figures are not provided in the bill text.

Groups Affected

• Large Companies: Increased reporting burdens and potential penalties for non-compliance.
• High-Income Individuals: Publication of their tax returns, potentially impacting privacy.
• UK Financial Institutions: New reporting obligations concerning company accounts and beneficial ownership.
• Companies House: Expanded responsibilities regarding information gathering and publication.
• HM Revenue & Customs (HMRC): Increased workload related to data collection, processing, and enforcement.
• Crown Dependencies and British Overseas Territories: Extended reporting requirements, impacting incorporated entities and their beneficial owners.
• Trusts: Obligation to register with HMRC and disclose extensive information, with potential penalties for non-compliance.

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