Spin II

Ironically, a few days after I wrote this:

"Lumping tax avoidance with tax evasion is part of the ongoing game of media spin and manipulation being played by the government and HMRC, to make people think of them as the same.

They are not the same!

Like it or not, tax avoidance is legitimate and will be with us as long as there are taxes."

Mike Warburton, private client director at Grant Thornton, was quoted in Accountancy Age:

"The government has tried to treat avoidance and evasion as if one is leading into the other.

It's perfectly clear avoidance is legal, evasion isn't; but the Revenue is trying to muddy the lines between them."

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Online Glitch

It seems that, ironically at the very same time that HMRC are telling people to avoid problems with the post strike and file online, people are experiencing problems with HMRC's online self-assessment system.

The Telegraph reports some people have been met with messages on screen saying that there had been an error, and that it was "unable to verify" that their information had been successfully submitted. The Times letters page also reports problems.

Spiffing!

A spokesman for HMRC is quoted by the paper:

"We are very sorry if anyone has had trouble getting through and we will look into any particular problems but the vast majority of taxpayers are not experiencing any difficulties.

There are still nearly four months left to file on-line but it's best to do so early because the system becomes extremely busy during January."

This implies that the system cannot handle peak load.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Incoherent

The National Audit Office recently reported that approximately 1.5M pensioners have overpaid around £250M in tax since 2002-3, as a result of discrepancies between HMRC records and tax deducted by employers and pension providers.

On the flip side of the coin, approximately 500,000 pensioners have underpaid approximately £103M of tax.

Amyas Morse, head of the NAO, has called on HMRC to provide a more coherent service:

"Older people want to pay the right amount of tax, but too many pay more than they need to because they do not claim allowances to which they are entitled and because of errors.

By providing a more coherent service, HMRC could make substantial savings as the number of enquiries from older people about their tax affairs would reduce - a win-win situation for all."

This situation is not entirely of HMRC's making, a large "dollop of blame pie" must be dished up to the government for creating such a complex and unwieldy tax system in the first place.

How on earth are people (taxpayers and those who work for HMRC, who are also taxpayers) meant to be au fait with this behemoth that they have created?

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Wooden Money

The Herald reports that a number of Scottish councils are getting very excited over the possibility of receiving tax rebates on VAT overpayments made during earlier periods (in some cases claims have been made dating back 35 years).

Seemingly councils, individuals and companies have received, to date, around £1.5BN in rebates from HMRC; eg Glasgow recovered £2.6M in VAT wrongly accounted for on hostel charges from 1974 to 1996, as well £3M in interest.

The councils will use the money to offset budget cuts.

All very well, maybe.

However, the rebates of "wooden money" are merely going from one organ of the state to another; no real income in the overall scheme of public finances has been received, the money "gained" by the councils will have to be saved elsewhere by the government and cuts then passed on to the councils.

They are spending time, effort and money scrambling after "wooden money"

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Spin

The Financial Secretary to the Treasury, Stephen Timms, is quoted in Accountancy Age:

"This Government will not tolerate tax avoidance or tax evasion in any form, and will act promptly to tackle both of these."

Lumping tax avoidance with tax evasion is part of the ongoing game of media spin and manipulation being played by the government and HMRC, to make people think of them as the same.

They are not the same!

Like it or not, tax avoidance is legitimate and will be with us as long as there are taxes.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

The Post Strike II

"Any returns that are late due to the postal strike will not incur a fine as long as they can produce proof of postage, confirmed a HMRC spokeswoman".

Accountancy Age

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Catch 22

My sympathies to AFC Bournemouth, who have been trying to pay a £150K tax bill lest HMRC wind them up.

Unfortunately, it seems that the club's bank account has been frozen as a result of the winding up petition being heard in the high court; as such the club has to approach the court to release funds when they wish to pay a bill.

Can you guess what happened next?

Yes, that's right, the high court blocked the payment to HMRC!

The Bournemouth Daily Echo contacted a spokesperson for the Judicial Communications Office, who stated that the judge had gone through the list of applications made and authorised the ones that they deemed strictly necessary in the immediate future.

Does this mean that the judge deems HMRC as being "not strictly necessary"?

Surely not?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Power Corrupts - Making It Up As You Go Along

HMRC, in their self righteous war against tax avoidance (tax avoidance is perfectly legal) have decided to change the rules to allow HMRC to interpret parliament's "true intentions".

New guidance from HMRC now tries to define tax avoiders as those seeking to pay less tax than "if Parliament turned its mind to the specific issue in question".

This change of definition will lead to many taxpayers, who have made perfectly legal tax arrangements, being subjected to HMRC investigations.

This change in the rules undermines parliament's right to legislate.

The new "code of practice" for tax inspectors defines tax avoidance:

"Avoidance is not defined in the Taxation Acts...One definition is 'a situation where less tax is paid than Parliament intended, or more tax would have been paid, if Parliament turned its mind to the specific issue in question.

At a practical level the problem is then essentially one of deciding what Parliament would have intended and identifying who should be asked to decide this.

Inspectors need to have in simple terms a working concept of 'avoidance' in order to properly identify cases which can be worked...The starting point should be that one would normally expect taxpayers to pay tax on their income or profits...It is reasonable to assume that where a commercial transaction is carried out in a particularly convoluted way, then avoidance is afoot."

Slowly but surely HMRC are attempting to put themselves above statute and parliament, and take on the role of judge, jury and executioner wrt taxation and the interpretation of tax law.

This is an "evolution" that must be stopped.

The bedrock of dictatorship is an overempowered, arrogant, unaccountable, unelected bureaucracy populated by "little men" who believe that they are working for a "greater cause".

Issues wrt tax legislation are for the elected members parliament to address, not the unelected bureaucrats of HMRC.

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Postman Prat

As we are about to enter a period of postal disruption, it is probably worthwhile commenting on HMRC's centralised post rooms.

There are I think, but please correct this if I am wrong, three in the UK. They are staffed by people working to targets, who have no knowledge of the tax system; ie the letters are meaningless to them, and they do not have the experience to direct them to the correct offices or departments.

Ironically, even though they work to targets, they do not receive feedback as to the quality of their service so that they can improve it.

HMRC pay for all the post to be re-directed ("customers", or tax payers, are never given the central post room addresses) to the central post rooms. The post is then opened, sorted (apparently some documents become detached and separated from the main letter) then HMRC pay for it to be re delivered by TNT, more often than not to the office that the letter was addressed to originally.

Staff, in at least one central post room, frequently fall behind wrt post opening and are then paid overtime to work weekends to try to catch up.

All outgoing post also has to go via the central post room, it is then taken by TNT to be packed in envelopes and then posted out from there.

As one commentator in the PCS magazine notes:

"Can it truly be more efficient to send mail posted in London to a regional post room miles away to be dealt with and then sent back?"

Answers on a postcard please!

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Brilliant!

I tip my hat to the member of staff from HMRC's "customer relations" who penned this this brilliant response to a "customer's" complaint.

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

The Post Strike

The deadline for filing paper tax returns is 31 October. However, there is the strong possibility of a postal strike occurring on or after 22 October.

HMRC have confirmed that, in the event of a strike, the £100 penalty for late returns may well be waived for those delayed by the strike.

Approximately 9.2 million people file by paper, of these around 10% usually miss the deadline thus yielding the government an extra £100M in fines.

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Switzerland Comes A Wooing

The Times reports that Swiss authorities are wooing chief executives of UK based companies, and other wealthy individuals, offering them tax saving deals to move to Switzerland.

Swiss officials from the cantons are personally contacting the CEOs of FTSE 100 companies, to persuade them to relocate their companies and families to Switzerland.

The Times reports that one chief executive was offered a flat tax rate of 10% on his personal income if he relocated the company to Geneva and lived there, as long as he provided a forecast of earnings for the next ten years.

Switzerland, and other countries, are capitalising on the increasingly punishing tax regime for high earners in Britain.

The government and HMRC may be in public denial over this. However, they are are aware that the high earners and tax avoiders that they are targeting will simply "up sticks" if they deem it to be in their interest to do so.

At some stage the costs of playing the "avoidance crack down card" will outweigh the revenue benefits.

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Playing Politics Again

Dave Hartnett, permanent secretary for tax for Revenue & Customs, can't seem to resist playing politics.

The Treasury expects to collect only 30% of the potential yield from the new 50p tax rate. However, Hartnett is quoted in the FT as saying:

"For HMRC [the Revenue] a 70% attrition rate or tax gap in respect of the 50% rate would not be acceptable.

We are keeping such schemes under very close scrutiny and where such schemes are seen to work technically, we will not hesitate to go to our ministers to ask for a change to the legislation."

Since when was it HMRC's role to dictate to parliament what changes should be made to legislation already passed by parliament?

Tax does have to be taxing.

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What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Ooh The Irony!

How ironic that, in the midst of a government propaganda campaign against tax avoidance (despite the fact that it is perfectly legal), the BBC (a taxpayer funded body) is proactively assisting its higher paid "stars" to avoid tax.

Many of the "stars" describe themselves as "freelance", and have set up service companies that enable them to avoid the new 50% tax levy.

The BBC also keeps hundreds of other presenters off its books, by putting them on freelance deals.

How ironic!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Breaking The Law

It seems that HMRC have been breaking EU tax law wrt stamp duty charges on cross-border transactions.

The European Court of Justice ruling could open the floodgates on numerous claims against HMRC and, as per Peter Cussons, head of PricewaterhouseCoopers' EU corporate tax division, "is indicative of a store of UK legislative tax issues that are unlawful under EU law."

If the experts in HMRC can't "get it right" wrt understanding the tax system, what hope is there for the rest of us?

When an individual/company breaks the law wrt deliberately under declaring tax, this is called tax evasion. What is it called when HMRC breaks the law wrt overstating tax liabilities?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Bankers Revolt

It seems that banks are making a stand against HMRC.

Approximately 308 banks, whilst not exactly taking to streets in a "Peasants' Revolt", are kicking up a fuss over HMRC attempts to pry out of them details about their clients' overseas bank accounts (using "Schedule 36 Notices).

The banks are appealing against the notices on the grounds that the request for information is "unduly onerous".

Whilst it is unlikely that, in the long run, the banks will be able to block HMRC this will disrupt HMRC's fishing trip for some time.

Powers for invasion of privacy and spying should be in proportion to the results expected. I remain to be convinced that this fishing trip will net the government billions in evaded tax receipts.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"

Backlog

UHY Hacker Young warn that new businesses are facing a struggle establishing themselves as a result of delays, of between three and five months, waiting for VAT numbers.

The theoretical timeframe for HMRC to complete most VAT registrations is two weeks.

UHY Hacker Young state that the delays are due to administrative backlogs, as HMRC carries out anti-fraud checks and inefficiencies in processing applications.

HMRC claims that over 70% of VAT registrations are processed in two weeks. However, UHY Hacker Young retort that this discrepancy is because HMRC only counts the time it takes to complete the actual administration, after it has received all the requested information. HMRC ignores the several months of checking and investigation beforehand, which forms part of the anti-fraud process.

Simon Newark, VAT Partner at the accountancy group, comments:

"The backlog at HMRC has never been worse, despite assurances over the last few years that the issue was being resolved. These delays are causing serious problems for small businesses trying to start up in a tough business environment and are hampering wider economic recovery.

Fraud will always be an issue, particularly during a recession, but if HMRC's own poor management and inefficiencies are to blame for delays, why should taxpayers bear the cost?

HMRC needs to streamline its processes and get a grip on its staffing issues as a matter of urgency.

The HMRC staff conducting the fraud checks routinely disregard information contained with the applications and demand the same documents, which are often completely irrelevant, again and again.

When I made a formal complaint I was told that because all taxpayers were being equally disadvantaged, no individual taxpayer had grounds to complain that he was being unfairly treated!"

LOL!!

Well now, if that is the attitude of HMRC (wrt individuals not mattering) maybe the firms who have suffered because of HMRC's delays should mount a class action; on the grounds that the entire group is being unfairly treated?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

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.

To find out more, please use this link Taxwise

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.

Click the link to read about: Tax Investigation for Dummies

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"