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11 July 2011

Tax simplification team to review pensioner taxation and share schemes

The Office of Tax Simplification (OTS) is to turn its attention to pensioner taxation and employee share schemes in two new projects.  These will run alongside the OTS’s ongoing review of small business tax administration and will continue its work to simplify the UK’s tax system.

The agreed terms of reference for the new reviews, together with those for the next stage of the OTS’s existing small business tax project, are included in a letter, published today, from Exchequer Secretary, David Gauke to the OTS.

The review of pensioner taxation will gather evidence from pensioner groups and other interested parties in order to identify and examine the parts of the tax system that cause taxpayers the most difficulties, look at how this varies across the pensioner population, and propose ways to improve the situation.

The employee share schemes project will initially examine the four tax advantaged, or Government approved, schemes to identify where they are complex and place unnecessary administrative burdens on their users, and to suggest ways they could be simplified. The OTS will go on to look at unapproved share schemes later in 2012.

David Gauke said:

“The tax system we inherited was a spaghetti bowl of reliefs and exemptions that pensioners and small businesses find particularly hard to navigate. We want the Office of Tax Simplification to look at how we can make life simpler for taxpayers who just want to comply with the rules and pay their taxes.”

 John Whiting, Tax Director for the Office of Tax Simplification, said:

“I am very pleased with the Minister’s ready endorsement of what will be a challenging and wide-ranging mix of projects for the OTS in its second year. There is potential here to help a wide range of people and businesses to deal more easily with tax, save a lot of administrative effort and cut down some of the technical complexities that abound. We hope many people and businesses will want to contribute their experiences and ideas to our work.”

As well as the two new reviews and the ongoing small business taxation project, the OTS will begin work to identify areas of the tax system that are characterised by “intense” complexity, with a view to identifying priority subjects for future reviews. 

Notes for Editors

1. The terms of reference for the reviews and the letter from Exchequer Secretary to the Treasury, David Gauke, to the OTS can be found at on the OTS section of this website.  

2. The independent Office of Tax Simplification was established on 20 July 2010 to carry out reviews in order to provide expert advice to the Chancellor on options to improve and simplify the UK’s tax system.

3. The OTS started its work in September 2010 and has initially taken forward two reviews on the simplification of tax reliefs and small business taxation. It reported to the Chancellor on both in advance of Budget 2011.  Both reports are available can be found at on the OTS section of this website.  

4. The OTS team is led by Chairman Rt Hon Michael Jack, and Tax Director John Whiting and currently has a staff of 6, drawn from HM Treasury, HM Revenue & Customs and part-time secondees from the private sector.  Details and biographies are available can be found at on the OTS biographies section of this website. 

5. The review of pensioner taxation will produce an interim report before Budget 2012 that will identify priority areas to look at in more detail, aiming to set out specific simplification proposals in a final report later in 2012.

6. The review of employee share schemes will aim to produce an interim report for Ministers by Budget 2012.

7. The OTS is asking for expressions of interest from firms who would like to second people to join the team carrying out these reviews.  There will also be limited opportunities for individuals to work with OTS.  Details can be found can be found at on the OTS vacancies section of this website, though it is stressed that the OTS is not normally in a position to pay secondees.  

8. The OTS will also be forming Consultative Committees to steer and advise its work on these new projects, in the same way that equivalent Committees have helped significantly on the Reliefs and Small Business projects.

9. The next stage of the small business tax project will be to look in detail at three specific areas:

The OTS expects to publish technical papers seeking views on these last two areas by the end of July. The small business review will conclude with a final report to be published by Budget 2012.

10. The OTS has taken on two new part-time team members to help with this project: Angela Williams, a self-employed tax practitioner, and Andy Richens, technical tax director of Bishop Fleming, a medium-sized firm of accountants based in the South West. Short biographies are available on the OTS biographies section of this website.

Non-media enquiries should be addressed to the Treasury Correspondence and Enquiry Unit on 020 7270 4558 or by e-mail to

This Press Release and other Treasury publications are available on the HM Treasury website. Previous OTS press releases are available on the OTS press relases section of this website. For the latest information from HM Treasury you can subscribe to our RSS feeds or email service.

Media enquiries should be addressed to the Treasury Press Office on 020 7270 5238 or to the Office of Tax Simplification on 020 7270 6190

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