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The Revenue has been warned not to impinge on advisers’ relationships with their clients, following the publication of proposals that would see a system of enrolment of tax professionals to allow them access to the department's resources.
The consultation document Establishing the Future Relationship Between the Tax Agent Community and HMRC makes two broad proposals, the first being that qualified advisers be placed on a database to ‘provide additional security against fraud and to differentiate paid, professional tax agents from those in the voluntary and community sector and those who provide free help for friends and family’.
Enrolled agents will be allowed them to carry out day-to-day transactions through a ‘self serve’ system that would allow them access the taxman’s admin facilities to perform such tasks as determining clients’ PAYE codes and managing payments and liabilities.
‘This is welcome recognition from the government that, when it comes to making the tax system work better, tax advisers are part of the solution rather than part of the problem,’ said Anthony Thomas, the president of the Chartered Institute of Taxation (CIOT).
‘The prospect of a self-serve facility for agents to access some HMRC systems is likely to be welcome. Agents are frustrated at the time they – and their clients – waste waiting for HMRC to do their job, or correcting HMRC errors, or chasing progress on routine business.’
He went on to highlight the risk of excessive bureaucracy and a ‘danger that it may lead to a perception that tax advisers work as the agents of the Revenue rather than their clients. It will be vital that HMRC’s back-end processes match the self-serve facilities’.
Mr Thomas, who took on his role as the CIOT figurehead last month with the aim of rebuilding the trust between taxman and taxpayer, outlined two major concerns of the new proposals, the second of which is the compilation of details of advisers and their client portfolios, to ‘help target and tailor HMRC support services to agents and, where necessary, identify poor practice’.
The CIOT president warned that ‘any attempt to introduce obligations between tax agents and HMRC that impinge on agents’ relationships with their clients would be completely unacceptable.
‘I welcome HMRC’s statement in the consultation paper that they are not seeking to change this,’ he added, going on to insist that ‘any system of enrolment… must be overseen by an independent body… HMRC cannot be permitted to be prosecutor, judge, jury and executioner when someone’s livelihood is potentially at stake.’
Mr Thomas’s counterpart at the Association of Tax Technicians, Simon Braidley, echoed the need for an independent overseer, and he praised the Revenue’s efforts ‘to drive up standards within the tax profession and make it easier for good tax agents to do their job’.
With the full implementation of the proposed enhancements not expected for five to ten years, Mr Braidley said it was essential in the interim that ‘HMRC raise their standards, so that when the agent strategy facilities are on stream, these are the icing on the cake for agents and not the cake itself.’
The Low Incomes Tax Reform Group urged HMRC to extend the self-serve proposals to advisers acting for taxpayers in an unpaid capacity.
‘Voluntary sector and informal agents should in any case benefit from a simpler, more streamlined authorisation process as envisaged in the consultation document,’ said the charity’s chairman, John Andrews, adding that the proposed agent strategy was ‘not an alternative to dealing with poor service levels at HMRC call centres and delays in responding to correspondence’.
He remarked: ‘What most taxpayers need is access to knowledgeable HMRC officials who can deal with their tax queries and requests promptly and accurately.’
Next week’s issue of Taxation – no. 4307 – will be a special edition devoted to the Establishing the Future Relationship Between the Tax Agent Community and HMRC consultation, with comment and analysis, and the opportunity for readers to submit their views.
