The Telegraph notes that, as from 1 April, new HMRC powers mean that income and corporation tax inspectors will have the same powers of entry as those used by Customs officials investigating unpaid VAT. Sue Holmes, head of national tax investigations at Smith & Williamson, is quoted:
"The many thousands of business people and sole traders who claim expenses for 'use of home as an office' should recognise that from next month, HMRC has the right to enter their home without prior warning to inspect business records.
Inspections can be approved by a senior official in a local tax office, Ms Holmes added."
HMRC downplay the likelihood of the abuse of the powers:
"HMRC does sometimes need to access premises connected with businesses to see such things as goods and assets where it is reasonable to do so, to ensure the right tax is being paid. Although HMRC is extending these powers, it is also extending safeguards.
In particular, unannounced visits can only be made with the approval of specially authorised officers."
That would be all well and good, if the authorising officers were outwith HMRC. However, they are part of HMRC therefore an independent check/balance does not exist.
The question is will the temptation to abuse these powers be too much for HMRC?
Tax does have to be taxing.
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"
"an independent check/balance does not exist"
ReplyDeleteAs often seems to be the case on this site, this is only partly true.
If an unannounced visit is made (which is only to be done in very limited circumstances), the person receiving the visit has the right to refuse the inspection and the visiting officer is obliged to give them a notice that draws attention to this right.
There are separate powers - primarily relevant to criminal cases - that allow unnanounced entry to premises where consent is not required. These powers, as far as I am aware, are largely the same as they have been for ages, and they very definately need independent approval as they're basically search warrants.
Please write to Sue Holmes and The Telegraph and tell them they are wrong.
ReplyDeleteYou seem to think there's going to be an army of HMRC officers marching into peoples homes.God there's barely enough of us to cope with the work we've got..
ReplyDeleteGet real
What the article says isn't particularly wrong. It's just selective, as writers often are when they're pushing an agenda (you know all about this!). It misses out the bit about the right to refuse access, for example.
ReplyDeleteAnyway, to paraphrase what you've said in the past, you need to read what I wrote. The bit from the blog entry I quoted and said was only partly true was your words, Ken, not the Torygraph's!
I agree with the site name, but only to an extent. About the article, I agree both with the fact that it will be abused and the fact that there ARE safeguards in place to allow me to refuse entry.
ReplyDeleteIf you take, for instance, the whole situation surrounding the use of CCTV cameras by the councils to catch petty criminals (fly-tippers, dog poo leavers etc), then the abuse of power by a govt agency does not seem all that far fetched, especially since CCTV cameras are only supposed to be used to help prevent terrorism and other major crimes.
I can appreciate that there does exist the right to refuse entry, BUT how many of your average self employed Joes are aware of these rules? I am sure that the officers who do go knocking on peopl's doors are not going to remind them that they have the right to refuse entry, that would just mean that they wasted a trip.
I sincerely hope that HMRC and its staff do not abuse this power, but I am sure that if they do, they will be allowed to continue to do so. We just LOVE writing letters of complaint to HMRC, but strangely, none get answered!