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.

Wednesday, 18 May 2011

The Light Touch


The Telegraph reports that HMRC is to reform its "drawn out and costly" inspection procedures.

HMRC now intends to "throw the book at" firms suspected of avoiding (not that avoidance is illegal) multiple taxes, while treating honest traders with a light touch.

Should not honest traders have been treated "lightly" anyway?

It seems that HMRC has recognised that it is now the "modus operandi" for multiple inspectors would make a compliance visits in consecutive months.

Hardly an effective use of scarce resources, nor does it help the hard pressed business focus on earning money to pay its taxes.

HMRC are quoted:

"We want to get off the back of honest businesses."

As such a new inspection process will be tested for six months from June. If successful, it will be rolled out nationally from January.

David Gauke, Exchequer Secretary, mastering in the bleeding obvious and using the "C" word is also quoted:

"We know that agents, individuals and businesses find some of HMRC's current compliance practices drawn out and costly.

A single compliance process could help HMRC improve the customer experience and reduce costs

"Innocent, until proven guilty" is a basic principle of English law, unless you are under the gimlet eye of HMRC.

As to whether the new inspection process actually improves things for the taxpayer, remains to be seen. Please let me know your experiences (good and bad) of the new process.

Tax does have to be taxing.

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  1. In other words, a lack of proportionality and therefore lack of legal authority.

  2. Would HMRC disclose which honest businesses they were "on the back of" and then tell us why?


  3. I'm confused. What's this actually got to do with avoidance? I know you'll have read the HMRC press release because you always thoroughly fact-check your posts, but it doesn't seem to mention the A word at all. Do you and Tyler have another source?

    You also lost me with '"Innocent, until proven guilty" is a basic principle of English [criminal] law...'. Again, have you read something elsewhere that makes this in some way relevant to this story? Has there, for example, been a change of policy wrt the assumptions compliance officers (or inspectors, as they used to be called!) are supposed to adopt at the start of an intervention? All very confusing!

    Stew G

  4. "risks and behaviours encountered dictate"

    Behaviours is HMRC speak for "avoidance".

    Feel free to ask Tytler as well.

  5. Well, surely it's "HMRC speak" for a range of things that includes evasion and mistakes leading to under-declaration of liability, as well as schemes designed to legally produce a result different from that intended by Parliament.

    However, as this appears to be about SMEs (I say this because it doesn't seem to fit with the CRM-led approach to larger businesses), which very rarely enter into such schemes (because only those with the resources can afford the pricey fees involved), I strongly suspect this is far more about looking for evasion and errors.

    The strategy for dealing with schemes designed to legally produce a result different from that intended by Parliament is heavily (possibly overly) reliant on DOTAS, so while they'll no doubt follow up any such schemes they find as part of this initiative (and why shouldn't they?), it's very unlikely that this is a central aim of the initiative.

    Stew G