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.
New HMRC, in the shape of guidance note EM1609, seems to allow inspectors to retain tax rebates for self assessment tax payers whilst reviewing the case but without the need to open a formal invetsigation.
Mike Warburton of Grant Thornton and the Chartered Institute on Taxation's John Whiting claim that there is no basis in law that allows inspectors to do this.
HMRC claim that the note "broadens the options" available to tax inspectors.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
As predicted, HMRC have issued a revised version of "Darling's bankers' bonus tax".
Sneaking it out late last Friday, thus trying to minimise their humiliation, HMRC said:
"The bank payroll tax announced at PBR 2009 applies to retail and investment banks (including building societies), and to banking groups. It does not apply to non-banking companies outside of banking groups (for example, insurance companies, asset managers, stockbrokers etc.)."
Doubtless this clarification will have greatly reassured those who try to do business in the UK that our tax laws are well thought through, and professionally drafted.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
It seems that HMRC are so very cross with tax advisers, who help people reduce their tax bill (ie avoid tax), that they are going to give some of them a public spanking and name and shame them.
Aside from the fact that, unless a criminal offence (ie evasion) has occurred, HMRC should not be publicly discussing the tax affairs of individuals and organisations it is a remarkably idiotic idea which will give the advisers some great free publicity (thereby undermining the HMRC's "lofty moral stance" on the issue).
HMRC claim that it would apply to advisers found to have acted "improperly" (whatever that means).
However, my sources tell me that HMRC seem to be a little confused as to whether their named and shamed list of advisers would apply only to those who aid evasion, as some (who have discussed this with HMRC) have interpreted the responses from HMRC re the new policy as also covering avoidance.
Could this be evidence of mission creep, in HMRC's and Labour's war against tax avoidance?
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
As I predicted, Brown's and Darling's plans for a bankers' bonus tax (levied to divert attention from the 1% rise in National Insurance) is rapidly falling apart.
Both HMRC and the Treasury have been forced to admit that that the draft legislation on bank bonuses is poorly written, and will have to be revised in the New Year.
It seems, as ever with Labour's shoddy legislative drafting, that the net for this tax could be drawn very wide indeed (eg more than just "bankers").
HMRC are stressing that asset management firms (including those owned by banks), hedge funds, investment advisers, private equity and family offices would not be hit by the tax.
However, no one believes them!
Do you?
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
The Public Accounts Committee have lambasted HMRC's tired old IT systems, stating that the systems "do not provide essential information".
In fact these systems are so tired and old, it is estimated that around £11BN of the £28BN of tax owed at March 2009 will remain uncollected. That's a tad more than the revenue that Darling kids himself he will make from taxing bankers' bonuses (£500M).
Anyhoo, the committee is of the view that more money needs to be spent on new systems.
Maybe so, but there are a few problems with this "statement of the obvious":
1 Brown has bankrupted Britain, there is no money available to spend on IT upgrades.
2 Will an IT upgrade really improve the bad debt situation so radically?
3 Are HMRC's executives and our "respected" politicians really capable of sourcing, implementing and managing a serious large scale IT upgrade? Experience tells us that they are not.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
Good luck to HMRC in trying to levy a "bankers' bonus tax", in the event that Darling implements one in his "Pre Budget Report" today.
Disregarding the fact that taxing one specific "class" of worker is contrary to the concept of taxes being non discriminatory, the tax will be unworkable:
1 There will be a wholesale exodus of banks, other financial institutions and individuals from the UK.
2 What is the definition of a "banker"? Those who currently fall into Darling's definition of "banker" will simply have their employment status/title changed, to eg "admin clerk".
3 Pay rises will be backdated to mop up the bonus pool.
The tax will be shot to pieces, and HMRC will be forced to waste valuable time and resources trying to "pin a tail on the donkey" of the bankers.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
There has been a large amount of chatter in various organs of the media recently about our "beloved" ex PM, religious convert and international peace maker, Tony Blair.
People are a little confused about how he makes his money, and the purpose of a number of companies that he seems to have connections with. Windrush Ventures, Tony Blair Africa Governance Initiative, and another called the Tony Blair Faith Foundation have all come under the spotlight.
The funny thing is that, as yet, no one has quite been able to make sense of the rationale for the structure of the 12 companies that Blair has created.
Now, were this anyone else, the obvious answer would be tax avoidance. Tax avoidance is of course perfectly legal. However, as TB is ex leader of the party that has officially come out against tax avoidance, describing it as "immoral", and as TB was once an MP (MPs' financial dealings are always above reproach, leading the moral way forward) this bizarre structure cannot possibly be for tax avoidance.
So what on earth is it for?
The Guardian, fed up with not understanding this either, has launched a wee competition asking accountants et al to study the company documents and structure and come up with an answer to this question:
"The former prime minister Tony Blair has received millions of pounds through an unusual mixture of commercial, charitable and religious income streams. Since he stepped down from office in 2007, his financial affairs have been described by observers as "Byzantine" and "opaque". The Guardian is now launching an online competition offering a prize to the person who can shine the brightest light on those financial structures.
Blair has a commercial consultancy, called Tony Blair Associates, plus jobs advising a US bank and a Swiss insurer. He has a multimillion pound book deal. He also has a charity, the Tony Blair Africa Governance Initiative, and another called the Tony Blair Faith Foundation. But much of the income, which includes charitable donations from other sources, has been funnelled through a structure called Windrush Ventures No 3 Limited Partnership. Our contest asks: what is Windrush?
Blair has a complex web of structures involving 12 different legal entities handling the unprecedented millions he is receiving since he stepped down from office in 2007.
So mystifying are the former prime minister's financial structures – which involve highly specialised limited partnerships and parallel companies – that the Guardian today launches an open invitation to tax specialists and accountants to attempt to explain the motivation behind such structures. We have published the Companies House documents and other legal papers regarding the structure of the partnerships at guardian.co.uk and invite expert comment via our site at guardian.co.uk/politics/series/blair-mystery."
I assume that HMRC have satisfied themselves that this does not conflict with their new found zeal to clamp down on avoidance schemes?
Any ideas anyone as to what this is for? There's an "HMRC Is Shite" T shirt in it for the winner.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
Dave Hartnett's vision of the future, automated HMRC systems that take action without reference to human involvement:
"I'd like to think that relations between tax authorities and practitioners will become less confrontational and more collaborative. If, by 2049, our tax system is fully founded on trust and openness there will have been real progress.
I would like the tax system to be widely seen for what it is – the provider of vital funds for public services. The internet and software that powers financial services will become more intelligent, providing customers with more control and flexibility over how they engage with HMRC.
Sadly, there will still be a need for compliance work and I think our systems will be driven by intelligent software that anticipates abuse, taking action without reference to human involvement.
There will still be plenty for people to do because good tax administration will always require sensitivity and judgment – that's one thing that won't change."
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
"If offshore tax havens are so evil, in the eyes of the Treasury and HMRC, why are HMRC's buildings subject to a sale and leaseback deal with Mapeley PLC (a property company based offshore in Guernsey)?"
It would seem that was not the only question that I should have asked about HMRC's relationship with Mapeley.
In fact "Serious Cat", in the comments section of that article, was quick to point out at the time that there were other issues wrt HMRC choosing Mapeley:
"I think we all know exactly why Mapeley were chosen for this property management contract and, indeed, there are some parliamentary minutes floating around which detail this reason - they're cheap!
Of course, Mapeley had no experience in property management, but theirs was the cheaper bid by far."
And
"The following is an excerpt from the "Oral evidence taken before the Committee of Public Accounts on Wednesday 27 October 2004"
Q1 Chairman: Good afternoon. Welcome to the Committee of Public Accounts where today we are looking at PFI: the STEPS deal, and we are joined by witnesses from the Inland Revenue, HM Customs and Excise and a witness from Mapeley. Mr Varney is the executive chairman of the Inland Revenue/Customs and Excise. It is your first visit, I believe. You are very welcome. He is joined by Ms Helen Ghosh, director general, corporate services, and Ms Siobhán McHale, director of estates and, from Mapeley, Mr Jamie Hopkins who is the chief executive officer. Mr Varney, does it give the Inland Revenue any sense of shame that they are now known as a well known tax avoider?
Mr Varney: I do not think they are known as a well known tax avoider. I do recognise that in the agreement there is an unfortunate feature. As you know, the government changed the guidelines so for a forward procurement that would not arise.
Q2 Chairman: Why did you not specify in the bidding documents for this deal that these properties should be held onshore?
Mr Varney: With the benefit of hindsight, one can say it was a mistake.
Q3 Chairman: Will you please look at paragraph 2.24 which you will find on page 21? You will see there that it says: "The Board of the Inland Revenue only became aware of the tax arrangements late in the procurement" and the Customs and Excise were not told until after the deal had been signed. Why is that?
Ms Ghosh: I was not there. It was before my time, but—.
Q4 Chairman: We are not interested in whether you were there or not. You represent this Department and you will answer questions on it.
Later in the minutes...
Q92 Mr Steinberg: You have no proven record, have you, as a company in property management?
Mr Hopkins: Prior to this transaction, no.
Q93 Mr Steinberg: Why did you go to them? Purely financially?
Mr Varney: £500 million to reinforce—
Q94 Mr Steinberg: You were prepared to gamble the whole of the Inland Revenue estate on the basis of £500 million which they may at the end of the day cock up?
Mr Varney: The NAO Report makes very clear we followed all the lessons from DWP. We tried to look at how we minimised the risk in this contract. The public purse is better off to the extent of £500 million, plus it has competition and flexibility. That is not a gamble. That is a sensible decision.
Q95 Mr Steinberg: I would have been very suspicious when a company comes along and they can undercut everybody by half a billion pounds. Are you not suspicious at all about that? They do not have a record in property management and they can come along and undercut everybody by half a billion pounds and you think you are on a safe deal, do you?
Mr Varney: I think you do the due diligence which is described in the NAO Report but I do not see my job as trying to maximise the revenue of service providers.
The full text is available here and it makes very interesting reading.
Hopkins has jumped ship from Mapeley and gone to one of their rivals, while Varney pocketed a knighthood and left HMRC in 2006.
Basically, the whole thing was a massive cock-up from beginning to end. Mapeley have no property management experience and it shows. Tales of 3-month delays in receiving a replacement light-bulb are not uncommon and many members of staff have simply given up reporting issues because of the poor service.
That's the reality of the Mapeley contract."
However, it doesn't end there. The National Audit Office (NAO) have issued a report that gives HMRC a well deserved kicking for this contract.
HMRC had promised £1.2BN of savings in maintenance and other costs, as a result of signing with Mapeley. In reality the savings will be around £900M, possibly falling to £650M.
The NAO go on to state that there is now a "significant risk" that the contract will not deliver value for money over the rest of its life.
It seems that, according to the NAO, HMRC had no long-term plan regarding the sale and didn't even know that Mapeley was offshore!
The NAO is of the view that HMRC had not recognised the contract as a major strategic asset, and had not allocated the requisite commercial skills to managing it.
Well done!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
I understand that HMRC, in an effort to save money, has decided to ask non English speaking people who call HMRC by phone (who require interpreters) if they have someone with them that can speak English or they can phone back once they have found a "friend" who can interpret for them.
This will save £75 per call which is currently paid to the Big Word Interpreter service.
Unfortunately most of the callers cannot speak English, therefore Big Word interpreters have to be used in order to give them this information.
Still, it was a nice idea in theory!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
The Sunday Times has a slightly "shouty" headline "Taxman targets exiles who keep UK toehold":
"RICH Britons who claim to have moved overseas could find themselves back in the clutches of the taxman if they have hung on to a car, a mobile phone number or even a golf club membership in the UK."
The article goes on to explain that HMRC's "new high net worth unit, which monitors the tax contributions of the country’s wealthiest 5,000 people, will examine the non-residency claims of the super-rich."
All very well maybe, the unit may be new, but the principle of "severing ties" is not new. I well recall my tax studies (when I was young, bright eyed and bushy tailed) whereby we were taught that those who claimed to be exiles had to demonstrate that they had fully left the country (eg by rescinding club memberships).
It seems that the rules haven't changed so much, but that the "alertness" of HMRC (in the face of the reality of Brown's Bankrupt Britain) has.
As to whether this new found "alertness" and "zeal" will benefit the country's finances in the long term or not remains to be seen.
Most certainly those classified as "super rich" will avoid the UK like the plague, as they have no intention of paying 50% tax.
Whilst this may provide some people with a certain schadenfreude, it will not in the long run do our country any good wrt attracting/keeping high achievers. These are the people, who through their energies and ambitions, build businesses that make significant contributions to the nation.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
In a clear admission of defeat, and as a result of protests by banks over the workload involved in informing on their customers, HMRC have extended their deadline for taxpayers to register their offshore holdings from the end of this month to January 4 2010.
Seemingly the fish are not yet scared enough to jump into HMRC's net.
However, in a reflection of the government's anti bank hysteria, HMRC are pushing the banks to speed up wrt providing information about customers' offshore accounts.
January 4 will be the final deadline to "sign up" for the amnesty on unpaid tax from foreign accounts.
Absolutely the final deadline, honest!
Clearly the top bods in HMRC are sweating, as the promises they made to Brown and Darling about how much money this amnesty would bring in are not being fulfilled.
Failure could mean that the top bods might find themselves out of a job, something that up until now only happens to the lower orders within HMRC!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
HMRC have got themselves in hot water over a blanket mailshot of around 30,000 letters, re offshore accounts, some of which were sent to the wrong people.
The letter urged the recipient to disclose funds held in their offshore accounts, under the New Disclosure Opportunity (NDO), even though the NDO rules didn't apply.
Accountancy Age quote one tax adviser as saying that the approach "smacks of laziness".
Advisers claim that a simple check of their clients' tax affairs could have revealed that NDO was not applicable to these individuals.
The advisers are missing the point here, HMRC were using this opportunity as a fishing trip.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
Data obtained by the law firm McGrigors shows that 27 people have registered with HMRC, since the Liechtenstein Disclosure Opportunity was opened on September 1.
However, HMRC have refused a similar Freedom of Information Act request wrt how many people have registered for the New Disclosure Opportunity (NDO).
The FT quote HMRC as saying that disclosure would "undermine the facility itself".
Fair enough, disclosing that very few people have taken up the NDO will doubtless encourage a "herd" mentality amongst tax evaders and they will simply follow the "majority" who haven't registered; ie they won't register.
Therefore, even though HMRC have refused to provide the data, it is clear that the refusal to do so indicates that take up of the NDO has been very low.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
Dave Hartnett continues to do the rounds, as he tries to encourage people to declare offshore holdings. In a recent interview with The Telegraph he is quoted:
"My hunch, it is only a hunch, is that a disproportionately large number of your readers will be relatively wealthy, will have hidden some money offshore, and some of them are going to end up in tears because they are just not going to have thought we would be as tough as we’re going to be."
Am I wrong, or is Hartnett beginning to sound a little like Denis Healey (re his speech from the late 70's boasting about "howls of anguish")?
All very well, if Hartnett were a poltician with a political axe to grind. However, he is a civil servant and is not meant to politicise his role. In fact he almost sounds as though he would relish making the middle classes cry.
What does "relatively wealthy" actually mean?
Quite why he has a sudden desire to tear into alleged middle class tax evaders, whilst the "super rich" are able to cut private deals with HMRC seems a tad hypocritical.
The fact is HMRC do not have the resources to hunt down and investigate the alleged hundreds of thousands of middle class tax evaders, that they would have people believe exist.
This is a smoke and mirrors exercise pushed by the dying Labour administration to cover up their mismanagement of the economy and chaotic mismanagement of the merger of Customs and the Inland Revenue, by trying to make people blame the economic meltdown and government bankruptcy on the alleged hundreds and thousands of "tax evaders" who have squirrelled away billions offshore.
Those who have "squirrelled away" significant amounts of money are doubtless wealthy enough to have given up living in the UK long ago, and placed themselves out of reach of Hartnett.
This media campaign is a futile arse covering exercise.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
HMRC's recently launched charter promises to "put mistakes right as soon as we can".
What does "as soon as we can" actually mean?
One month?
No!
Two months?
No!
Six months?
No!
HMRC in fact seem to regard "as soon as we can" as being a "paltry" 13 months!
The figures come from the adjudicator's office, which handles complaints against HMRC.
That is the average time (some hapless self employed taxpayers are in fact having to wait up to 18 months) it now takes HMRC/the adjudicator to communicate to taxpayers the outcome of complaints against HMRC.
The appalling lag in communication appears to be down to a rise in complaints about tax credit awards, and staff shortages.
There is a solution for taxpayers, caught in the bureaucratic mire of HMRC and the adjudicator's orifice, build a Tardis and travel to the future to find out the result of the case.
Would the cost of such a capital investment be tax deductible I wonder?
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
It seems that tax supremo, Dave Hartnett, fresh from his "critically acclaimed" appearance on YouTube, has got the taste for celebrity and may well have fantasies about appearing in the jungle with Jordan et al.
That at least would seem to be the conclusion that one could draw from his appearance last week at the ICAEW, where he delivered the ICAEW's 2009 Hardman Lecture.
His subject being "Tax, transparency and trust".
During the lecture he described tax as being "a jungle", and appealed for businesses to allow HMRC staff on secondment to be allowed unfettered access to their financial systems etc.
Aside from the fact that the private sector, and individual, has little reason to trust this government's (and its organs') respect for privacy, respect for freedom, competence wrt data security and competence per se; Hartnett did not exactly endear himself to his audience.
Nichola Ross Martin (a respected tax advisor and, by Hartnett's bitter chip on the shoulder generalisation, a "tax alchemist") observed:
"I found Dave's attitude terribly disappointing".
She noted that he managed to alienate the majority of the attendees.
It seems that his lecture was not designed to win converts, but was merely an excuse to play to the gallery of his political masters in the Number 10 Bunker.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
It seems that HMRC's New Disclosure Opportunity (NDO) has, so far, not been the rip roaring success that HMRC had forecast; despite Dave Hartnett's foray onto YouTube.
The NDO has not yet attracted the disclosure of significant numbers of undeclared offshore accounts, thus the original forecasts of it generating £500M-£1BN may well be rather wide of the mark.
Andrew Watt, managing director, tax disputes and investigations for accountancy firm Alvarez & Marsal Taxand, said:
"There is definitely a perception in some quarters that the NDO is a bit of a dead duck.
We may be a smaller organisation, but I know some of my colleagues in more well-known firms are finding the same thing."
However, the Liechtenstein Disclosure Facility (LDF) is proving to be more successful; as those who are eligible are transferring their offshore accounts to Liechtenstein and using the LDF, which attracts less harsh HMRC penalties.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
The Tax Justice Network (registered in Belgium) has recently published a Financial Secrecy Index, which allegedly evaluates the transparency of "tax havens" and their willingness to cooperate with other countries tax operations.
Rather amusingly the UK comes in at number 5 out of 60; ie we are "naughtier" than eg the Cayman Islands.
FYI, Belgium (where TJN is registered) comes in at number 9. Maybe, in the interests of practicing what they preach, they should register themselves in Monaco (number 60)?
Vilifying these places may well give some peculiar emotional satisfaction to the hair shirt wearing members of TJN. However, it serves little practical purpose and is potentially harmful to our own economy.
"A recently published Treasury report into offshore tax havens (British Offshore Financial Centres) highlights the important role played by the Crown Dependencies in funding banks on the UK mainland.
Which is kind of ironic, given that HMRC and the Treasury have been vilifying these places for sometime now describing them as havens for "evil" tax avoiders and tax evaders.
The report notes that the Crown Dependencies make a "significant contribution to the liquidity of the UK market".
Given the parlous state of the Brown's Bankrupt Britain, and the fact that despite owning several banks the government appears to be powerless to increase bank lending (thus kickstarting a recovery), the liquidity provided by these offshore centres is even more vital to our embattled economy.
The report notes that in the second quarter of this year, they provided net funds to banks in the UK of £195BN.
Oh and what makes these offshore centres a magnate for inflows of money, that are then funnelled into the UK?
That would be their low tax rates!"
Anyhoo, following the "logic" of TJN, the British government should be pressing itself to reveal to itself details about financial transactions etc going on within its own borders?
John Christensen, director of the Tax Justice Network's international secretariat, is quoted on the Accountancy Age site lumping in tax avoidance with fraud, terrorism and all manner of illegal activities:
"But this comes at a price.
Financial secrecy provides cover for all manner of crimes and abusive practices: money laundering, tax evasion and avoidance, insider trading, terrorist financing, embezzlement, Ponzi schemes, illicit financial flows, fraud and much more."
Hype, even by TJN's standards!
These people will not be happy until there is 24 hour state monitoring of our every action (financial, physical, etc), their rationale being "guilty until proven innocent"!
Thus starts the journey to dictatorship.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
HMRC has renegotiated its Aspire contract for IT with service providers Capgemini, Accenture and Fujitsu.
The renegotiated contract (the second time HMRC has done this in 2 years) aims to save £110M per annum by scrapping the legacy systems taken on board by the merger of the Revenue and Customs and Excise, and by shutting down a number of data centres.
The service providers will have exclusivity until 2013. All of HMRC's IT expenditure will now be channelled through Aspire, locking out any other potential suppliers.
CEO of Capgemini Aspire, Nigel Martin is quoted on Crystal Umbrella:
"The new agreement would not have been possible without our track record of reliable service and up to 200 projects delivered on time and within budget for HMRC each and every year."
I wonder if reality will live up to hype?
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
Patrick Reynolds has set up a petition on the Number 10 Website, calling for HMRC create a similar system:
"There are large numbers of matters of detailed routine in tax matters and in dealings with HMRC that are inefficient and waste a great deal of time. Accountants, tax payers and advisers are well aware of many of them, as are many HMRC staff.
HMRC should be required to have a web site where such matters could be posted. Postings would be restricted to matters of administration and procedures. Postings on individual cases or on taxation policy would not be permitted. HMRC would not be obliged to take account of requests made for changes. They would however be required to explain why aspects of poor administration were allowed to remain unchanged."
I doubt that this will ever come to fruition, as HMRC is not managing to cope with the current levels of enquiries and paperwork etc.
You can sign the petition via this link HMRC Petition.
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
As noted many times on this site the tax system, as it currently stands, is far too complex.
Michael Izza (CEO of the ICAEW), in an interview with AccountingWEB, says the very same thing:
"Q: In the ICAEW's Enterprise survey, 54% of respondents said UK regulatory and tax environment was 'not very' or 'not at all' business friendly. Employment tax and legislation and business tax changes were all regarded a hindrance. Why do you think businesses responded so negatively and what do you think can be done to improve the situation?
A: This is a constant refrain, and we hear this from businesses of all sizes. We have a great opportunity this year because we're moving into the last few months of this government, there has to be an election no later than June 2010 and this is now the time when business people of all sizes can start to talk to their MPs (or prospective MPs) about the things that bother them and the legislative changes they would like to see.
The institute has issued a manifesto and that was something we were talking to politicians about at the three main party conferences in September and October. One of the themes in it is that we need a more simplified government in this country. An area which I'm sure many of your members will be familiar with is the tax code. The tax code in this country now runs to over 11,200 pages.
There is nobody in HMRC who understands that from A-Z. There is no chartered accountant in this country who understands it from A – Z, it's just become too complicated. We have an opportunity to make something like that more simple, for everyone in business. This is the sort of thing we should be talking to the politicians about now and saying we want to see it changed.
We're at one of those moments in history where because of the economic crisis that we've just experienced and the fact that things are going to be very different going forward, we might be able to make a very significant change in something like that; and that's the sort of thing the institute is going to be asking for."
Never let a "good" crisis go to waste!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
As Dave Hartnett bestrides the net like a colossus, warning tax evaders that they may be banged up in jail, and HMRC gets "heavy" with tax avoidance schemes and offshore financial centres it may be worthwhile focusing on how much tax is actually lost as a result of offshore and onshore tax avoidance schemes (legal).
Last year the TUC conducted some research that they said proved that tax avoidance by the 50 largest companies in the FTSE 100 was depriving the Treasury of £11.8BN.
Deloittes decided to analyse the TUC's research, and concluded that it was bollocks. The amount of tax that the Treasury "loses" from companies using avoidance techniques and offshore tax havens is in fact less than £2BN.
In addition to Deloittes rubbishing the TUC claims, a recently published Treasury report into offshore tax havens (British Offshore Financial Centres) highlights the important role played by the Crown Dependencies in funding banks on the UK mainland.
Which is kind of ironic, given that HMRC and the Treasury have been vilifying these places for sometime now describing them as havens for "evil" tax avoiders and tax evaders.
The report notes that the Crown Dependencies make a "significant contribution to the liquidity of the UK market".
Given the parlous state of the Brown's Bankrupt Britain, and the fact that despite owning several banks the government appears to be powerless to increase bank lending (thus kickstarting a recovery), the liquidity provided by these offshore centres is even more vital to our embattled economy.
The report notes that in the second quarter of this year, they provided net funds to banks in the UK of £195BN.
Oh and what makes these offshore centres a magnate for inflows of money, that are then funnelled into the UK?
That would be their low tax rates!
The same low tax rates that our blinkered Treasury is telling them to raise.
Could it be that the Treasury and HMRC are trying to use tax avoidance and smear offshore financial centres, as diversionary tactic to take people's attention away from the Treasury's and HMRC's economic mismanagement and incompetence?
Surely not!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
It seems that there are some in HMRC who have Papal delusions, and believe that they are infallible.
That at least is the conclusion one may draw from the phone conversation reported by Accountancy Age, between a taxpayer (reclassified by HMRC as "deceased") and a member of staff from one of HMRC's call centres.
After persuading HMRC to reinstate her as "living", she went on to ask how the mistake had occurred.
Answer:
"We don't make mistakes, madam."
Alrighty then!
Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations
TAXWISE 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.
Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.
