Wednesday 19 September 2012

HMRC Goes Fishing



I see that HMRC seem to have gone on another of their little fishing trips, wrt using queries about possible errors on tax returns to find out financial information about the taxpayer and others (eg divorce settlements).

That at least is the view of the ICAEW Tax Faculty:
"We have received reports that HMRC is making informal enquiries which may amount to no more than thinly disguised fishing trips.

HMRC has staff working in Compliance Centres whose job is to make less formal enquiries, such as to query the amount of interest declared on a return where it does not agree with information in their possession. Robert Maas wrote about this in TAXline in May 2011.

Generally, we welcome this initiative as it can save a lot of time and expense in resolving simple enquiries. However, is HMRC over-stepping the mark and using this process as a convenient way to obtain information to which it would not normally be entitled? 

One example quoted to us is that of an enquiry being made into the return of a divorced woman to find out more about her divorce settlement and therefore her ex-husband.

Have you had similar experiences?"
In the event that you have had similar experiences please feel free to share here, and also let the Tax Faculty know.

Tax does have to be taxing.



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3 comments:

  1. I am not interested in the slightest as to how Stew G perceives this or anything else.
    However, is there someone out there who can explain, concisely, the legal basis for this?
    It appears to me that the TMA may be in opposition to earlier enactments dealing with spouse/ex.spouse/partner relationships and otherwise private information.
    Now, if a settlement is taxable upon the person receiving it fine, but then should it not be a tax write-off for the, or is it a double-taxation issue?
    Don't know answer, just hoping for a non self-centred reply please.(there's always hope!)

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  2. Who cares!? As long as they use the information to make them pay the tax they owe.

    Besides wouldn't most other halves give this information freely if they knew HMRC were going to use it to screw over their ex

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  3. "One example quoted to us is that of an enquiry being made into the return of a divorced woman to find out more about her divorce settlement and therefore her ex-husband".

    Bit close to entering into a covert relationship or something. There is a thin line here that can be crossed and spouse vs. spouse tends to bring out the worst in people, but if you want to read about HMRC's success, or otherwise in these "black arts" you need only refer to various HMIC reports and their findings.

    Never learn do they?

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