HMRC Is Shite

HMRC Is Shite
Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.

Thursday, 5 March 2015

The State Supports Avoidance


Contrary to what the politicians would have us believe, the state very much favours tax avoidance (until, that is, its avoidance measures enter the public domain).

As per the Telegraph:
"Two Government departments have been fined and 100 NHS bosses and civil servants have been fired after the Treasury discovered that staff were being paid “off the books” through companies. 
Danny Alexander, the Chief Secretary to the Treasury, fined the Ministry of Defence and the Department of Health a total of £1.5million after it emerged that they were not doing enough to stop staff being paid through companies and potentially reducing their tax bills."
Quel surprise!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday, 4 March 2015

Guilty Until Proven Innocent - Concentrix Makes Up For Lost Time

On Sunday I noted that Accountancy Age, on the very same day as my article about Dearnley, wrote about outsourced tax credit Concentrix staff in Belfast being paid millions (approx £72M) to do nothing for three months as a result of a systemic HMRC IT failure.

Concentrix were tasked with checking up on erroneous or fraudulent UK working tax credit payments.

Clearly worried over the time wasted, Concentrix are now applying themselves with gusto to the task and have gone for a spot of fishing. As per the Independent:
"When Mary Folwell got a letter from HM Revenue & Customs last month, she put it to one side assuming it was just a standard reminder that her tax credits would be renewed.
When she got round to opening it, she had a shock. It was actually from an HMRC-appointed agency named Concentrix – and it accused her of living with someone and threatened that unless she could prove otherwise, her tax credits would be stopped within 30 days.

"It said they had evidence to suggest that I was living with someone, which sent me off into panic mode," Mary, a 55-year- old pre-school teacher in Bristol, told me. "I separated from my husband two years earlier and had moved into a small flat on my own. There really has never been anyone else here."

The letter threatened that if Concentrix did not hear from her by 24 February, "we will stop your tax credit". "I only get £15 a week," explained Mary – "which may not seem much but it's crucial to my budget. If I lost that money, I would really struggle."

She's not alone. Tens of thousands of people – mainly single mothers, it seems – have been targeted with similarly bullying letters. The letters are not only frightening, but their demands are needlessly onerous. In short they demand that people supply almost all their personal details to prove some spurious suspicions that HMRC may have. Failure to do so within a couple of weeks means losing out on essential cash for which they are eligible."
This is corroborated by a loyal reader, who commented yesterday regarding postal delays:
"......and better.......have heard that working tax credit disputed overpayments post is so far behind that they are starting to send out "shortened" response letters not explaining anything but just telling the taxpayer to pay up.

Quality customer service !!
"
Low hanging fruit are the easiest to pick, especially when using the tactic of guilty until proven innocent!


Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday, 3 March 2015

HMRC's Postal Delays


In November 2014 I quoted Ed McKeegan (Director of HMRC Estates and Support Services) extolling the benefits of HMRC's "digital" postal procedures (as he announced the closure of various post rooms):
"HMRC's digital transformation is improving the service we offer our customers, and post handling is now at the forefront of those changes with the introduction of post scanning by Personal Tax (PT), which contributes around 70 per cent of RPR work. For PT, the introduction of post scanning means they can reply to customers more quickly, with the ability to send post to any desktop, in any office, in an instant we won't need to spend time sorting or transporting it."
Fast forward to March 2015, and a loyal reader advises me that all is not well in HMRC's brave new world of "digital" post handling.

I understand that hardly any post is getting worked in PT Operations.

For why?

Apparently so many offices are now flex sites, that the staff are on the phones all the time. Thus, for instance, letters dated September are only now being answered.

The scanned post is all waiting to be processed and dealt with, but staff are on the phones instead.

Late self-assessment tax returns, many of which have been sent back for correction, have been logged in as received in December, but the figures are still not captured. Therefore no statements have been produced, and taxpayers wanting to pay can not be given an accurate amount.  There are various work lists with thousands and thousands of items on them. 

I am advised that there is a tool that telephone staff can click on to get an estimate of when a taxpayer will receive a reply to any correspondence they have sent in. Why not try ringing up (general information will be given without taxpayer details, just ignore the automated questions) and ask about a fictitious letter you posted in December, and see what the reply is!!!!  

Thus my question is this, if most of PT Operations are now Flex sites and staff are always on the phones, who is left to actually to deal with the mail?

Answers anyone?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Sunday, 1 March 2015

Three Year Managers For Ten Year Projects - Dearnley's Binary Revolution


My thanks to the loyal reader who penned this most excellent analysis about Dearnley and the "binary revolution" in HMRC:
"Dearnley is a probably being economical with the actualit√© like so many members of HMRC’s Ex Com.

The constant shouting of the word 'Digital' to describe their IT strategy should immediately ring alarm bells since by their very nature all the Departments computers have been digital (ie using binary compiled code) since the date the Inland Revenue bought their very first LEO machine second hand from Joe Lyons in the 1960s. As a consequence the Revenue could claim to have digitised most of its work decades ago. It would be nice to see such obvious bullshit occasionally challenged at places like PAC.


More seriously, while Dearnley frequently likes to boast about his speedy roll out of Windows 7 to all HMRC desktops he negelects to mention that in the process it has broken loads of applications, created many problems and generated thousands of lost man hours of work

With regard to the problem of 'legacy' systems Dearnley seems to fail to understand or deliberately ignores the basic issue that all IT applications fall into that category the moment they hit the live metal and start running in anger. It does not matter whether they are 5 minutes old or 5 years old they all have to be maintained and they all face the issue that the software and hardware on which they were designed and run is sooner or later out of date. Moreover, political events and changes to legislation will mean the functionality is going to have to be constantly updated and enhanced.

It is certainly true that HMRC over the years has wound up with a huge IT estate running a wide range of different platforms, operating systems and applications. However, the people largely responsible for that situation are not the Revenues IT suppliers but the Board of HMRC itself, including individual like Dearnley and Pavitt who have constantly changed the core IT strategy. For example, a few years ago the mantra coming out of Ex Com was that HMRC was to buy not build its software so they invested massively in various proprietary COTS packages, many of which were costly and often incompatible with the Revenues needs so had to be expensively customised. Now the pendulum has swung completely the opposite way and HMRC now are betting the whole shooting match on Open Source systems and bespoke applications written in house. That punt may come off but it is a very high risk strategy particularly as much of the software being used is largely untried and unproven for running major government systems and the in house HMRC 'Digital' Teams in Newcastle and elsewhere have no experience of delivering and supporting systems on that scale. In addition, there is the very real worry that Dearnley appears to be funding his ambitions by stripping out investment in maintaining and supporting the existing legacy estate which still runs 99% of HMRC systems. If his grand schemes come to nothing then the Revenue could end up with the worst of all worlds with new systems not fit for purpose and old applications needing costly large scale upgrades to keep them running.

The suspicion is that Dearnley who spent a mere three years at Vodafone before cutting and running to HMRC in 2013 will do exactly the same thing to the Revenue when his contract expires in 2016. Unfortunately, by then HMRC may find its IT has been well and truly scuppered.
"
Ironically Accountancy Age, on the very same day as my article about Dearnley, wrote about outsourced tax credit Concentrix staff in Belfast being paid millions (approx £72M) to do nothing for three months as a result of a systemic HMRC IT failure.

Let us trust that Dearnley (if he is actually competent) doesn't regard this as merely a two/three year stepping stone role on his career path.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Friday, 27 February 2015

Mark Dearnley Lives In The Past


Mark Dearnley, CIO of HMRC, recently gave an interview to CIO which was rather revealing.

He joined from Vodafone (there's irony for you) in 2013, and described his role as "nothing short of transforming a centuries-old organisation into a digital, modern, real time business".

Errmmm, HMRC is not centuries old; it was formed by Broon in 2005!

Anyhoo, that little snafu aside, Dearnley acknowledges the challenge presented by legacy systems, a long-standing issue for HMRC IT chiefs. He says he would like to consolidate tax systems from over 100 to "one or two".

Yet he regards the platforms used by HMRC as being fine, and rejects the idea they are somehow "bad platforms".
"This nation has survived and brought in trillions of pounds worth of tax on these platforms."
Yes, but just because something once worked it may no longer be fit for purpose now; given that people's working patterns have changed (eg multiple sources of income).

In fact he appears to be enamoured with batch processing:
"Is real-time brilliant and batch terrible? 

That's the wrong question. 

There are things for which batch is fine. 

There are other things where you need real-time updates."
He intends to cobble together old and new:
"Some of that will use things that are new. Some of that will take advantage of some of the great things that have been developed over the years.

There's no 'oh it's not new so it must be bad' - there's actually 'if it's ideal for the role let's build on it'.
He is also of the view that he has more than other Whitehall departments:
"Most people underestimate how much talent we have within HMRC.

It would appear we actually have more than some other parts of government. 

I have thousands of civil servants. We already run all of the platforms that collect 40% of the UK's tax. And I've managed to create what I think is quite a fantastic leadership team."
He waxed lyrical about the new team in Newcastle, which has moved tax credits renewals online in just eight weeks in start to finish Dearnley claims.
"We set up a Scrum team and said: 'Go and see what you can do, you've got eight weeks'. They built a complete tax credits renewals service in eight weeks from start to finish, and we integrated it in real time to all the back-end systems.

That went live in eight weeks. We thought if it went really well, maybe 80,000 people would use it during renewals – 410,000 people used it. I think we had about a 94% customer satisfaction rate, which is absolutely phenomenal."
Hmm, what say you loyal readers?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Thursday, 26 February 2015

In Like Flint - PAC's Chat With HSBC and HMRC


PAC had a busy day yesterday, having a wee chat with the "great and the good" of both HSBC and HMRC.

HSBC chief executive Stuart Gulliver apologised to MPs for "unacceptable" practices at HSBC's Swiss subsidiary. Alongside Gulliver was HSBC chairman Douglas Flint.

Gulliver also defended his personal decision to be paid by the bank via a Panamanian company with an account in the Swiss private bank, insisting that the arrangement was not designed to avoid tax, but to protect his privacy against other members of staff who were able to view employees' accounts via the company computer system.

Gulliver is quoted by the Telegraph:
"There was no tax advantage or purpose whatsoever.
I would like to put on the record an apology from both myself and Douglas for the unacceptable events that took place at our private bank in Switzerland in the mid-2000s. It is an apology we would like to make to you, our customers, our shareholders and the public at large. 

It clearly was unacceptable. We very much regret this, and it has damaged HSBC's reputation."
Asked precisely what he was apologising for, Gulliver said:
"The lack of controls and practices which now - judged with the benefit of hindsight - we would not be at all comfortable with if they were happening today, and which have clearly resulted in damage to trust and confidence in HSBC and created further reputational damage to our firm and have therefore hurt clients, customers, shareholders, our staff and people at large.
Flint told the Treasury select committee that he blamed the failings at the Swiss unit on its management, and said secrecy surrounding banking in the country made it difficult for him to have a direct line of sight of what has happening at the bank (funny way to run a bank!). Chairman of the bank since the end of 2010, Flint was finance director at the time the Swiss subsidiary was purchased by HSBC.

Homer, for her part, admitted that she is concerned by the perception that HMRC is soft on the rich and tough on the poor. The fact is that low hanging fruit, unprotected by lawyers and tax professionals, are an easy target for HMRC.

John Mann asked her:
"What would you do if you discovered any parliamentarians were dodging tax?"
Lin Homer replied that she’d have to check “whether I had an obligation, or an ability, to refer” them to the parliamentary authorities.

She went on to assure PAC that where there are people in positions of responsibility, HMRC does act.

Homer repeated that HMRC doesn’t expect a ‘waterfall’ of new prosecutions, even though it can now share the Swiss data with other agencies.

Homer denied that Hartnett has any inside information on HSBC’s Swiss bank, or HMRC’s systems etc etc.

Here is the transcript.

So everything is basically fine, nothing to see here move along please!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"