Scottish Income Tax Board minutes: May 2024

Attendees and apologies

• Deputy Director, Tax Strategy, Engagement, and Performance, Scottish Government (SG) (Chair)
• Head of Tax Strategy and Income Tax, SG 
• Income Tax Team Leader and the Single Point of Contact for Scottish Income Tax, SG
• Economic Adviser, Fiscal Analysis, Office of the Chief Economic Adviser, SG 
• Deputy Director, Income Tax Policy, HM Revenue and Customs (HMRC) 
• Deputy Director, Compliance Strategy Delivery, HMRC
• Head of Compliance Strategy Delivery, HMRC
• Senior Policy Advisor, Devolved Income Tax and the Single Point of Contact for Scottish Income Tax, HMRC 
• Head of Income Tax: Structure, Devolution, and Strategy, HMRC

Items and actions

Board Papers Update 

HMRC discovered that a number of individuals were recorded in both the Self-Assessment and PAYE data extracts used in the production of the Scottish Income Tax Outturn Statistics. This occurred when individuals filed unsolicited Self-Assessment returns from the 2016 to 2017 tax year through to the 2021 to 2022 tax year.  This does not have any impact on individual taxpayers. To resolve this issue HMRC have removed these cases from the PAYE data extracts and will revise the outturn figures which can be viewed in the Scottish Income Tax Outturn Statistics due to be published in July 2024. 

The board approved the Scottish Income Tax Outturn methodology for 2022 to 2023 which includes a process to prevent the error reoccurring.

The board approved the criteria to inform decisions about the frequency of the third party data clash. The data clash compares HMRC’s address records with third party data to assess the accuracy of HMRC’s identification of Scottish taxpayers. 

Scottish Income Tax Communications 

The objective of Scottish Income Tax communications to improve understanding of Scottish Income Tax, build public awareness and promote voluntary compliance, is a priority for the board.

HMRC set out the options and costs to develop additional Scottish Income Tax communications. The board commissioned HMRC to develop communications through the Personal Tax Account, an online HMRC platform individuals can access to view their tax information. 
The board discussed HMRC’s ongoing work to triage the feedback received from external stakeholders at last year’s annual stakeholder event. HMRC is using the feedback on the issues and opportunities of Scottish Income Tax to explore ways to improve the Scottish taxpayer customer journey. 

As part of this work, HMRC is reviewing the guidance advisors use to respond to Scottish Income Tax customer queries. Additionally, HMRC and Scottish Government will review the Scottish Income Tax guidance on the GOV.UK and GOV.SCOT websites respectively. 

The next annual stakeholder event will take place in Autumn 2024. 

Scottish Income Tax Compliance 

The board discussed the new compliance working group that has been set up to further develop a robust assessment of Scottish Income Tax non-compliance. The working group met for the first time on 7 May.

The board approved the working group’s Terms of Reference, subject to minor amendments. 

The board agreed to update the Service Level Agreement for 2024 to 2025 to include details of the compliance working group.

Public Audit Committee review 

The board discussed the Public Audit Committee evidence hearing attended by Scottish Government and HMRC on 25 April 2024.   

The board will engage with the Public Audit Committee on ways to share details with them of the administration of Scottish Income Tax throughout the year.  

Review of changes to the Scottish Income Tax board agenda

The board reflected on the progress made since its decision in May 2023 to restructure the agenda of the board. The restructure shifted agenda items from business as usual to strategic topics of discussion focussing on continuous improvement activity.

The board agreed that taking a more strategic approach has been positive and has focused discussions on key priorities such as Scottish Income Tax communications and compliance.  

The board agreed to introduce an additional touch point meeting 6 weeks before each board meeting takes place to maintain momentum on discussions and actions. 

Forward Look 

The board reviewed the 2024 to 2025 Forward Look and agreed to discuss the following additional agenda items at the next board meeting on 21 August:

• analytical work on the Scottish Income Tax evidence base
• the Scottish taxpayer customer journey 
• HMRC’s annual report on the administration of Scottish Income Tax 
• the Scottish Income Tax Outturn statistics for 2022 to 2023 

AOB and Close 

Scottish Government’s Tax Strategy will be published later this year. 

The chair closed the meeting.