Improving Lives: Work, health and disability green paper

While LITRG is not a disability organisation, we think the tax and related benefits system is capable of influencing behaviour in this area – something which is not addressed in the green paper and something we are well placed to comment on.

The purpose of our response is therefore to highlight what we see as some current barriers to work in areas such as income tax, VAT, NIC, and tax credits. We make recommendations on where we think rules and practice could be changed to improve incentives, reduce burdens and thus contribute to the Government’s overall objective. These include:

• All employed disabled people should be able to claim as an employment expense the costs of putting themselves, as far as possible, on a par with non-disabled people.
• There should be VAT relief for modifications in the workplace.
• From April 2018, that the system of NIC credits be extended to disabled people whose profits from self-employment do not exceed the small profits threshold.
• HM Revenue & Customs (HMRC) should treat any ‘strengthened self-employment’ test tax credit cases involving disabled people sympathetically, taking account of the fact there may be particular circumstances to consider.

We also look at the delivery of HMRC services for disabled people in our submission and raise some concerns about how HMRC assess and monitor their compliance with equality law. In our view, improvements in these two areas will help foster a sense of trust between HMRC and their disabled customers and thus, make it more likely that they will ask for the help they need to manage their tax and tax credit affairs.

The consultation can be found on GOV.UK. 

Our submission can be found here: 

Meredith McCammond