A new Welsh tax – one year on

Last year, we at the Welsh Revenue Authority became the body responsible for administering the first Welsh taxes introduced in almost 800 years. The introduction of these taxes also marked a historic moment for Wales. 

On 1 April 2018, we began collecting and managing land transaction tax (LTT), which replaced stamp duty land tax, on behalf of the Welsh government. We are also responsible for administering landfill disposals tax, which replaced landfill tax. 

Almost one year on, we now have more than 2,000 organisations in England and Wales registered to file LTT on our digital tax system. In our latest LTT quarterly statistical publication, we reported 17,280 LTT transactions with a total of £66.5m tax due (October-December 2018). 

Partnership approach 

We have developed a partnership approach, which we term ‘Our Approach’, in administering theses taxes. 

We have taken inspiration from the Welsh language to define this, as follows: 

• Cydweithio: this literally means ‘to work together’ and carries a sense of working towards a common goal.
• Cadarnhau: this suggests a solid, robust quality that can be relied on. This is about providing certainty, being accurate and reinforcing trust.
• Cywiro: this literally means ‘returning to the truth’ and is about the way we work with you to resolve errors or concerns.  

In simple terms, we are committed to working with taxpayers, agents and other partners to help support them to pay the right amount of tax at the right time. 

Putting ‘Our Approach’ into practice 

We have established systems, processes and operations which have been specifically centred around the needs of taxpayers and their representatives, based on ‘Our Approach’. We have worked with agents and professional bodies, including the Law Society, on this important ongoing work.   

We have responded to feedback on our fully cloud-based, bilingual tax system, which was recently recognised in a UK IT industry award. We are currently making changes to these services, including improving the print-out of the tax return and making the system easier to use. We are also refining the guidance available on our website directly in response to queries and suggestions from industry professionals. 

We are proud of our bilingual helpdesk and the experience and knowledge each member has developed on LTT to respond to queries by phone, email and letter. The team works closely with our dedicated LTT specialists to deal with more complex enquiries and, where required, we encourage the use of our free tax opinion service. 

Managing tax risk through ‘Our Approach’ 

We are managing tax risk by taking a holistic view of the different tax risks that exist or may emerge in future by identifying underlying causes and effective solutions upfront. We use our own data as well as data from partner organisations to identify these risks. We also listen to feedback and discuss potential issues with agents, partners and other industry professionals. 

Our focus is on minimising the ability for that risk to lead to incorrect tax returns in future, rather than waiting for errors to be made and then focusing resources on retrospective enquiries. We consider engagement and education, improvements to guidance, digital service updates and amending legislation, among other actions, part of this prevention work. 

We are committed to introducing a successful approach to tax risk, using ‘Our Approach’, as it will reduce longer-term risk and provide assurance that those paying LTT are paying the right amou nt of tax at the right time. We will act to recover tax where people have got things wrong or are deliberately avoiding or evading tax. And where there is uncertainty, we will work with taxpayers and agents to correct matters as efficiently as possible, taking a proportionate approach.

Sean Bradley is chief legal and policy officer at the Welsh Revenue Authority