Commentary

A1.107 Office of Tax Simplification (OTS)

Administration and compliance

A1.107 Office of Tax Simplification (OTS)

A1.107 Office of Tax Simplification (OTS)

What is the OTS?

The OTS is a permanent independent Office of HM Treasury. Its existence was formalised in statute by Finance Act 2016 with effect from 28 November 20161. Previously, it had been established by the Coalition Government in 2010 as a temporary, non-statutory Office of the Treasury for the life of that Parliament.

The role of the OTS is to provide the government with independent advice on simplifying and improving the administration of the UK tax system and make recommendations as appropriate, with the objective of reducing compliance burdens on both businesses and individual taxpayers.

The UK tax system is defined for these purposes as all those taxes (including the legislation for administering those taxes) for which HMRC is responsible, including duties and National Insurance contributions2. Its programme of work is approved by the Chancellor and the Financial Secretary to the Treasury, and it undertakes enquiries into existing areas of tax policy and its administration, as outlined in public terms of reference for each enquiry.

The OTS must provide the Chancellor with, and publish, an annual report about its work as soon as reasonably possible after the end of every financial year (ending 31 March), and the Chancellor must provide a copy of this report to Parliament3.

The Treasury will review the effectiveness of the work of the OTS every five years and publish a

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