The Treasury has dismissed the Tax Incentivised Savings Association’s request to delay the taxation of platform rebates by 12 months.
HM Revenue & Customs announced last month that platform rebates to investors will be taxed from 6 April.
Tisa technical director Jeffrey Mushens wrote to Treasury economic secretary Sajid Javid in an attempt to delay the implementation of the tax until April 2014, when the FCA’s new platform rules will come into force.
The Treasury’s response this week confirms there will be no U-turn on the implementation, but HMRC will work with the industry to ensure the tax is applied correctly.
Mushens says: “The Treasury has told us this is the law as it now stands and to get any kind of delay would be very difficult to achieve.
“One good thing is that the tax was not applied retrospectively so we need to move forward and see how we can apply this at the lowest cost to the industry.”
Tisa is set to meet with HMRC this week to discuss how best to implement changes where required by platforms.
HMRC estimates suggest it will recoup around £4m a year through the taxation of rebates.
The Lang Cat principal Mark Polson says: ”It was worth a try from Tisa but it did look unlikely a delay would be allowed. The focus now must be on making sure everyone’s systems can process the tax requirements efficiently on a bulk basis.”