The second report of the Office of Tax Simplification (OTS) on employee benefits and expenses has been published in addition to a response to the consultations in this area. A consultation has also been launched which examines a recommendation made by the OTS that the Government introduce the concept of the “marketable security” into the tax rules for employment-related securities. Responses to this consultation are due by 10 October 2014.

This second report focuses on what the OTS refers to as the way forward in three of the main areas of this project:

• ‘big picture’ ideas – longer term, structural reforms;
• HMRC administration; and
• travel and subsistence.

In framing their recommendations the OTS advises that it has responded to evidence found in another wide ranging set of meetings and workshops and the many comments and submissions received.

The OTS also outlined that there is a need for HMRC to take a more facilitative, encouraging and constructive approach in these areas. In a number of areas they have suggested there is a need for HMRC to develop guidance and illustrations – and then commit to keeping those examples and helpsheets up to date as new points come up. The OTS sees the current rules as having a tendency to put the entire onus on the employer to research rules and take decisions on what is to be taxed and that this area should be seen as an area for joint responsibility and working.