HMRC Is Shite: August 2012

Friday 31 August 2012

Agent Visits Suspended

HMRC had plans to visit between 80-90 agents at the end of this month, as part of a pilot to gather the views of "low performing" agents.

"Low performing", as defined by HMRC, being agents whose clients' filing or payment performance for corporation tax and self assessment had been judged of "insufficient" quality.

Hmmm, I wonder what "insufficient quality" actually means?

Anyhoo, worried agents can breath a sigh of relief, HMRC have suspended their plans for the visits.

For why?

Taxation reports that concerns about the pilot were expressed from the representative bodies on the Joint Tax Agent Strategy Steering Group, as such more time will be given to discussion of the matter.

Tax does have to be taxing.

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Thursday 30 August 2012

Poll On Clegg's Tax The Rich Call

Tax does have to be taxing.

Wednesday 29 August 2012

Booze Matters - HMRC Lose Tax Revenue

I am rather amused to read that MPs are up in arms at HMRC over its "soft" approach to prosecuting people for smuggling booze, and the loss in tax revenue from smuggled booze estimated at being £1.2BN per annum.

There is a touch of irony that those who receive taxpayer subsidised booze are complaining about the voters attempting to get their hands on their own form of "subsidised" booze.

Anyhoo, PAC have published a report today entitled "HM Revenue & Customs: Renewed Alcohol Strategy". Oddly enough it is dated 12th July 2012, the reasons for the delay in publication are not clear.

The report notes that there were no more than six successful prosecutions each year, in the four years to 2009-10.

However, Lin Homer has responded (as per the BBC):

"HMRC's performance in tackling alcohol fraud is measured by the combined impact of both civil and criminal proceedings on alcohol duty evasion - which increased significantly when the strategy was introduced.

Prosecutions are a strong deterrent and HMRC continues to investigate cases criminally where this will maximise impact on the fraud."

Whilst the figure of £1.2BN lost per annum covers beer and spirits, there is no clear indication of the revenue lost from wine smuggling (much to the chagrin of PAC).

The report notes:

"The department does not make best use of intelligence and technology to detect and prevent alcohol duty evasion.

The department needs to work more closely with the industry to improve its understanding of legitimate export markets, and improve how it works with the UK Border Force to gather intelligence on illegal alcohol imports."

Here is an extract of the summary:

"In April 2010, HM Revenue & Customs (the Department) launched its renewed strategy to reduce the amount of tax lost each year due to alcohol duty evasion, principally through fraud which often involves exporting duty unpaid alcohol to the near continent, which is then redirected to the UK and released to the market with no duty paid. In 2010-11, the renewed strategy delivered £433 million in financial benefits against a target of £390 million.

The Department collected £9.5 billion of revenue from excise duties on alcohol in 2010-11. However, it estimates that there is a tax gap—the difference between taxes due and the amount actually collected—of up to £1.2 billion. The Department has not produced an estimate of the tax gap for wine, despite a commitment to our predecessors to do so. Without reliable information on the scale and nature of duty evasion for each category of alcohol (beer, wine and spirits) the Department cannot tailor its approach to target its efforts to tackle evasion to maximise value for money.

The Department does not yet have good enough information on the returns it secures from investing in specific areas of activity to make best use of the additional £917 million it plans to spend on reducing all kinds of tax avoidance and evasion. It told us that the rate of return on its work to reduce alcohol duty fraud is approximately £17 to £1 but it is not clear whether it could target its resources more effectively to secure a better return on its investment.

The Department is consulting on a range of measures to reduce alcohol duty fraud, including a proposal to introduce fiscal stamps for beer, an approach which appears to have been successful in reducing duty evasion on spirits. The Department does not yet have a full understanding of the costs and benefits of these proposals, including the compliance costs for the industry of introducing fiscal stamps for beer and the impact on legitimate wholesalers and retailers.

The Department does not make best use of intelligence and technology to detect and prevent alcohol duty evasion. The Department needs to work more closely with the industry to improve its understanding of legitimate export markets, and improve how it works with the UK Border Force to gather intelligence on illegal alcohol imports. In addition, the Department does not yet use the full capability of the Excise Movement Control System (EMCS), which facilitates the tracking of freight across the European Union, and could be used to target interventions and investigations more effectively. The Department implemented EMCS in phases over two years as planned, but did not make full use of its capabilities when implementation was completed.

Despite an estimated £1.2 billion being lost each year from duty evasion there are very few successful prosecutions for alcohol duties fraud. In the four years from 2006-07 to 2009-10 the highest number of successful prosecutions in any one year was six and the highest number of defendants was 16. The Department does not take enough account of the deterrent effect of successful prosecutions when considering the cost and benefits of
pursuing perpetrators through the courts."

Cheers!

Tax does have to be taxing.

Tuesday 28 August 2012

HMRC's Customer Relationship Managers

As we shake off the dregs of the Bank Holiday weekend, and gently ease ourselves into the week ahead, here is an amusing variation on the concept of a "customer relationship manager" courtesy of HMRC.

In the real world CRM's are (in theory) meant to act as the interface between the customer and the organisation that they represent (eg bank, FMCG etc etc); hopefully smoothing away any "irritations" that may have upset the customer, thus leading the way to increased sales etc.

In HMRC's world a CRM is assigned to those "customers" (ugh how I loath that word when used in connection with tax matters) who come under the remit of HMRC's Affluent Unit. The Affluent Unit was set up in September 2011, with much fanfare by Danny "Beaker" Alexander, to handle the tax affairs of those individuals who earn more than £150K per annum. It consists of around 2,000 experienced HMRC staff members, who were reassigned from other duties within HMRC.

HMRC's publicly stated purpose of their CRM's is to provide better “customer service”. However, as the Telegraph notes, the CRM also builds up a detailed knowledge of their "customer's" tax affairs. Thus HMRC is in a better position to identify possible tax evasion, and will use the information garnered by the CRM's to investigate their clients.

Tax does have to be taxing.

Friday 24 August 2012

The Dangers of Credit Cards

As the state and other organisations often warn, credit cards and the debt that their owners rack up can be dangerous.

It is not just ordinary members of the public that are tempted into debt by these little slithers of plastic, but also a manager within HMRC.

Accountancy Age reports that a member of HMRC's management was suspended last August and has now been sacked, following an investigation by the Independent Police Complaints Commission (IPCC).

It seems that she is alleged to have spent over £10K using HMRC corporate credit cards, both her own corporate card and those assigned to her team.

Allegations were put to her last year about the withdrawals, she claimed that some of the transactions were used to pay intelligence sources and others to maintain a petty cash float in her unit.

The IPCC was not impressed with her defence, and stated that her version of events was "inherently implausible" (ie bollocks).

The case was passed on to the Crown Prosecution Service. However, for reasons that are unclear, no criminal charges were ever brought. Instead a disciplinary hearing was held, and she was fired.

The IPCC reviewed procedures over the use of cards in the manager's unit, and expressed serious concerns credit cards could be used with such a frequency undetected over a 12-month period. The unit did not have adequate systems in place, the petty cash procedures were lax and there was no real audit process.

The IPCC has recommended regularly changing codes to room and cupboard locks, and ensuring all accounting within the unit could demonstrate a clear and accountable audit process. It also suggested HMRC "share learning" from the case with its other units.

I trust and assume that HMRC are equally understanding and supportive when they visit SME's that HMRC regard as having less than perfect financial controls and reporting!

Tax does have to be taxing.

Thursday 23 August 2012

Capital Allowances Webinar For The Self Employed

HMRC will be holding a webinar on "Capital Allowances For The Self Employed" this afternoon between 15:30-16:30:

"We will show you the different types of Capital Allowances available and some practical examples.

Capital Allowances are tax allowances that can be claimed when you buy items of equipment and are self-employed."

This who wish to participate need to register here.

Tax does have to be taxing.

Contacting HMRC - Corporation Tax Number Changes

As per the HMRC website, HMRC is changing its contact numbers for Corporation Tax enquiries.

Here is the announcement in full (all clear?):

HM Revenue & Customs (HMRC) is changing the way Corporation Tax customers contact HMRC by phone - to bring them into line with other HMRC customers. From 17 September 2012, most calls about Corporation Tax will be routed to one of two contact centres - based in Cardiff and Glasgow - through a new number.

If you or your clients are dealt with by one of the Corporation Tax operational offices listed below, your calls will be handled by the dedicated contact centre teams.

If your enquiry cannot be dealt with at this first point of contact, it will be referred to and dealt with by a dedicated operations team, who will contact you where necessary.

Please note: the number you need to call will not change if your enquiry is being dealt with by a specialist team, for example for the Large Business Service.

The existing telephone numbers for each Corporation Tax Office will transfer as follows:

Corporation Tax Office	Existing telephone number	Date of transfer
City of London (Euston Tower)	02076 674200	15 October 2012
Ipswich	01473 261564	19 November 2012
Lincolnshire (Lincoln)	01522 884336	1 October 2012
Merthyr Tydfil	01685 353848	17 September 2012
Norfolk (Norwich)	01603 776390	19 November 2012
North West London (Harrow)	02081 969105	29 October 2012
North West Midlands & Shropshire (Wolverhampton)	01902 371115	22 October 2012
Notts & Derby (Nottingham)	01522 884336	1 October 2012
Scotland East (Dundee)	01382 424225	8 October 2012
Scotland North (Aberdeen)	01382 424225	8 October 2012
South London (Croydon)	02086 334500	5 November 2012
South Wales (Cardiff)	02920 325003	17 September 2012
Staffordshire (Stoke)	01902 371115	22 October 2012
Sussex (Brighton)	01273 225340	12 November 2012

Once your Corporation Tax Office has transferred to the new number, you should call Tel 0845 366 7819. If you're calling from abroad please call Tel +44 151 268 0571. The helpline is open from 8.00 am to 6.00 pm, Monday to Friday.

Tax does have to be taxing.

Wednesday 22 August 2012

HMRC In Colombian Standoff With Ipsa

I am gemused to see that our "respected" and "morally erect" MPs (the group of people who like to lecture the rest of us on the immorality of tax avoidance) have got themselves into hot water with HMRC.

It seems that, quite correctly, HMRC are a tad worried that MPs are claiming accountancy fees on expenses; these claims for fees might amount to taxable benefits, as opposed to work related costs.

MPs, being the "morally erect" citizens that they are, have countered the allegation via the expenses watchdog (the Independent Parliamentary Standards Authority - Ipsa) asserting that they are business expenses.

FYI the costs being claimed are up to £5K per annum per MP.

The Guardian reports that HMRC have repeatedly told Ipsa that other employees are not allowed to claim back professional fees or the tax, and MPs should not be given special dispensation.

Ipsa insists that MPs are more akin to small businesses, which can reclaim such costs.

Funny that, I didn't know that public service was in fact a "business"!

Anyhoo, there is now a "Colombian standoff" between Ipsa and HMRC; it will be interesting to see who blinks first.

Now what was it Cameron, Gauke et al were saying about tax avoidance???

Tax does have to be taxing.

Tuesday 21 August 2012

Summer Holiday? - UPDATED

My thanks to a loyal reader who has pointed out that the last entry on HMRC's "What's New" page on the HMRC website is dated 13 July (well over a month ago).

Does this mean that nothing new at all has occurred during this period, or that the department that updates this page is on a protracted holiday?

Factoid: Our "illustrious" elected representatives are currently on a 47 day break.

UPDATE

Folks, proof positive that HMRC read this site. Since posting this morning that there were no updates since 13 July (and yes, I did check that myself), HMRC have now updated their "What's New" page!

Hoozah!

Tax does have to be taxing.

Monday 20 August 2012

If At First You Don't Succeed

As I noted last week, both HMRC and the ICAEW were cock-a-hoop with themselves over Lin Homer's statement (delivered with a loud fanfare) that HMRC may be "investing up to" £34M and may be placing "up to" another 1,000 staff in HMRC's beleaguered call centres:

"HMRC have with great fanfare and naive approval of the ICAEW attempted some diversionary tactics by announcing a reallocation (HMRC calls it "investment") of "up to" £34M and a possible extra 1,000 personnel into their call centres. "

Many, including myself, are somewhat cynical about this rearrangement of the deckchairs and whether it will actually be effective.

Over the weekend my little grey cells were stirred to life with the memory of something that happened in March 2011, on the watch of Homer's predecessor the late Lesley Strathie.

Here is an extract of a transcript of evidence given to the Treasury Committee on 16 March 2011 by Strathie.

Can you spot the similarity between what she promised to do, and what Homer has just promised to do?

"Q217 Andrea Leadsom: That is very reassuring. It would certainly be very helpful to have some information on what you target and what you are achieving against those targets.

Can you talk us through your stated intention to recruit 1,000 extra contact centre staff between April and September to deal with volumes? Is that happening already? Where are you going to recruit those people from? How will they be trained?

Lesley Strathie: We will recruit them, first and foremost, from staff who require redeployment from other areas of the business, where that is shrinking. One of the things we have done in response to staff morale is to remove all the barriers right across the department to people applying from one business line to another. We think that will probably attract about 25% of those posts. The other 75% we will recruit using the Government’s job-broking agency, Jobcentre Plus, as the main deliverer of those people.

Q218 Andrea Leadsom: How will they be trained?

Lesley Strathie: We have very specific training for contact centre staff. It has been a fairly ring-fenced part of the business since HMRC started to move work to the telephone.

Q219 Andrea Leadsom: You don’t have any concerns about the quality of the call centre training?

Lesley Strathie: Yes, I have a lot of concerns because we have so many different business lines and, in its history, the department has constantly moved things on to the telephone. The purpose of bringing these 1,000 people in is because we moved the renewals of tax credits, which is an annual process when we need to establish that people are still entitled and calculate the final award, and because of that peak business on the telephone.

While we want to make sure that the customers that have suffered through the stabilisation of PAYE don’t get a deteriorating service, we feel we have to meet that peak, which is through July. So we need to bring them in and train them, but we will be training these staff on specific areas of business, not right across the whole 14 lines."

Yes, that's right, she promised to "recruit" an additional 1,000 staff!

A few questions spring to mind:

- Were these people ever recruited?

- If so, where were they recruited from?

- Did they need a high level of training?

- Did they really add value to the call centre performance?

- Why does HMRC think that another 1,000 will resolve the issue, if the previous 1,000 did not?

- What is the definition of insanity?

I'll give you a clue to the last question:

It's repeating an action (that has in the past failed), in the deluded expectation that this time it will work!

Tax does have to be taxing.

Friday 17 August 2012

Live Webinar - PAYE Expenses & Benefits for Employers

HMRC are hosting a live webinar today at 13:30-14:30 on PAYE Expenses & Benefits for Employers.

If you're interested in attending, this webinar is aimed at employers and covers: -

- What is an expense and what is a benefit.
- Non-taxable expenses and benefits.
- Dispensations, what they are and how to apply for one.
- Record keeping
- Taxable Expenses and benefits
- Where to get further help and guidance.

You will need to register here if you wish to participate.

Tax does have to be taxing.

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Tax does have to be taxing.

Thursday 16 August 2012

HMRC's Most Wanted

On the 19th of July I wrote about HMRC's Flickr gallery that shows mugshots of HMRC's most wanted and, amusingly, of Excom and other staff members.

One month on, and HMRC have woken up to the fact that they actually have a gallery and have decided to tell the world (sorry lads, I told the world about it a month ago!).

Anyhoo, here is HMRC's press release (albeit one month late):

"To help in the effort to hunt down the United Kingdom’s biggest tax fraudsters, HMRC will place photographs of its Most Wanted on its flickr channel and ask members of the public to assist in finding them.

The Most Wanted are tax criminals who have absconded after being charged with a crime or during trial. HMRC has worked with Crimestoppers to gather information from the public that may help capture these criminals and others like them, but this is the first time that HMRC has published photographs and details of tax dodgers’ crimes.

David Gauke, the Exchequer Secretary, said:

“The Government is absolutely committed to tackling tax evasion and fraud. These criminals have collectively cost the taxpayer over £765m and HMRC will pursue them relentlessly. We hope that publishing their pictures in this way will enable members of the public to contribute to the effort to catch them.”

Tax evasion and fraud cost the taxpayer around £10bn. The Government is committed to cracking down on those who try to dodge their responsibility to pay tax and has invested over £900m in HMRC in order to raise an additional £7bn each year in tax revenue.

HMRC’s Top 20 Most Wanted can be seen here www.flickr.com/hmrcgovuk

People can report leads on the Most Wanted fugitives via HMRC’s Customs, Excise and VAT fraud reporting hotline on 0800 595 000, by email or post here, or through the Crimestoppers website www.crimestoppers-uk.org

Notes to editors
1. If you're calling from abroad please telephone:

If calling from Belgium, Denmark, France, Germany, Republic of Ireland, Netherlands: 00800 555 95000

If calling from mainland Spain: 900 988 922

If calling from any other country, please treat the call as an international call to the UK

2. Images are available on HMRC’s flickr site www.flickr.com/hmrcgovuk

3. Follow us on Twitter @hmrcgovuk

Issued by HM Revenue & Customs Press Office
HM Revenue & Customs (HMRC) is the UK’s tax authority.
HMRC is responsible for making sure that the money is available to fund the UK’s public services and for helping families and individuals with targeted financial support."

Don't forget to have a good look round the Flickr site (eg click on Excom to see pics of Excom et al).

Tax does have to be taxing.

Wednesday 15 August 2012

Here Come The Penalties

For those of you who have still not sent in your 2010/11 tax returns to HMRC (apparently around 500,000 people have been "tardy/forgetful") you may soon expect to hear a light thud on your doormat as your penalty from HMRC arrives.

It seems that the penalties will be for a minimum of £1,200 per person (that makes around a minimum of £0.6M in penalties accruing to HMRC) being:

the maximum £900 in daily penalties for non-filing
a further late-filing penalty of £300 or 5% of the tax due (whichever is higher).

These penalties are of course in addition to the £100 late filing penalties for missing the 31 January deadline (which were issued in Q1 of this year).

However, be not alarmed, as HMRC’s Director General for Personal Tax, Stephen Banyard, said:

“We want the returns, not the penalties."

Here is the full text of the HMRC press release:

"Around half a million people who still haven’t sent their 2010/11 tax returns to HM Revenue & Customs (HMRC) will start to receive additional penalty letters from this week.

The number of outstanding returns has almost halved in 2012, down to 5.9 per cent, compared to 10.7 per cent in 2011. This means 518,000 fewer penalties are being issued. HMRC has also taken 273,000 people out of Self Assessment this year.

New penalties were introduced in April 2011 to boost the incentive to file and reduce the costs to taxpayers of chasing up missing forms. As a result, anyone who ignores their Self Assessment filing obligations is now liable to higher penalties than in previous years.

The penalties being issued from today will be for a minimum £1,200, comprising:

the maximum £900 in daily penalties for non-filing

a further late-filing penalty of £300 or 5 per cent of the tax due (whichever is higher).

People who receive a late-filing penalty can appeal against it if they think they have a reasonable excuse for not sending their tax return; for example, a family illness or bereavement.

Anyone who has received a late-filing penalty and has not sent in a return, but thinks they don’t need to be in Self Assessment, can still potentially apply to be taken out of Self Assessment. They can visit www.hmrc.gov.uk/latetaxreturn to check what to do if they think they don’t need to be in Self Assessment. If HMRC agrees, the return and any penalty will be cancelled.

HMRC’s Director General for Personal Tax, Stephen Banyard, said: “We want the returns, not the penalties. This year, half a million more people have filed their return – which means we are issuing 44 per cent fewer penalties.

“But, despite several reminders, nearly six per cent of people have not sent their 2010/11 tax returns to us and they’ll be getting a penalty.

“Where someone has a reasonable excuse for not sending a return on time, we will waive the penalty. We also recognise that there will be some people within this group who don’t need to be in Self Assessment, and we will be happy to remove them from the Self Assessment system and cancel their penalty.”

The penalties being issued over the next few weeks are in addition to £100 late-filing penalties for missing the 31 January filing deadline, which were sent out in late February and early March.

Notes for editors1. The new penalties for late Self Assessment returns are:

an initial £100 fixed penalty, which now applies even if there is no tax to pay, or if the tax due is paid on time;

after three months, additional penalties of £10 a day, up to a maximum of £900;

after six months, a further penalty of 5 per cent of the tax due or £300, whichever is greater; and

after 12 months, another per cent or £300 charge, whichever is greater.

2. There are also additional new penalties for paying late of 5 per cent of the tax unpaid at: 30 days; six months; and 12 months.

3. Further information on the new penalties is available from the HMRC website at http://www.hmrc.gov.uk/sa/deadlines-penalties.htm

4. Follow HMRC on Twitter at: @HMRCgovuk

5. Images are available on HMRC's flicker channel www.flickr.com/hmrcgovuk"

Tax does have to be taxing.

Tuesday 14 August 2012

NAO To Audit HMRC's "Customer" Service

As I noted exactly a week ago, the National Audit Office (NAO) qualified HMRC's accounts for the tenth year running.

In the meantime, HMRC have with great fanfare and naive approval of the ICAEW attempted some diversionary tactics by announcing a reallocation (HMRC calls it "investment") of "up to" £34M and a possible extra 1,000 personnel into their call centres.

Whilst the above may satisfy the ICAEW and some naive taxpayers, the NAO are not going to sit idly by. The NAO is looking at commitments made under the HMRC’s change programme and will report "in winter 2012" on the service that HMRC’s "customers" receive over the phone, online and in writing.

WARNING THE FOLLOWING SENTENCE CONTAINS MULTIPLE "C" WORDS!

As per the NAO:

"The NAO will examine the extent to which HMRC understands and meets customers’ needs and expectations; its customer service strategy; and how HMRC plans to change its business in order to ‘improve customer service with fewer staff’.

Whilst the ICAEW may be trumpeting the fact that the £34M "investment" is down to their efforts, the reality is clear; HMRC are trying to shift the deckchairs around before the auditors issue their report.

Tax does have to be taxing.

Monday 13 August 2012

PAYE Complaints Rise

It seems that the PAYE problems of 2008-10 continue to give HMRC a headache.

Accounting Web reports that complaints to the Adjudicator about HMRC payment claims have more than doubled in 2011-12.

Overall, the number of complaints about HMRC rose 32%, but HMRC's intransigence in blocking requests for underpayments to be written off under Extra Statutory Concession A19 contributed to a 114% increase in PAYE complaints in the latter half of the year.

“We expected an increase in complaints following the introduction of the new PAYE computer system due to the high level of customer interest,” wrote Judy Clements, in the forward to her Adjudicator’s annual report.

	Cases awaiting investigation	New cases for investigation	Cases resolved
April 2012	992	1,606	1,133
April 2011	2,041	1,235	2,284

The Adjudicator also noted a significant rise in the percentage of complaints upheld against HMRC during the year. Out of 494 taxation-related complaints received, 197 were partially or substantially upheld - a success rate of just under 40% compared to 23% in 2010-12.

As I noted in July HMRC is now consulting on watering down the A19 concession.

Tax does have to be taxing.

Friday 10 August 2012

HMRC To "Recruit" 1,000 New Staff

A mere two days ago I wrote yet another article about HMRC's telephone service standards, as if by magic HMRC have today issued a press release about the issue.

HMRC will recruit "up to" an additional 1,000 call centre staff, and "invest" "up to" an additional £34M by 2014 in an attempt to resolve the shite call handling performance.

A few observations:

1 Have HMRC not been reducing headcount over the past few years? Therefore to recruit "up to" 1,000 call centre staff seems to fly in the face of the ongoing headcount reduction.

2 Will the new staff be of the same skill and experience levels as those who have been dismissed? Ermmm.....I wouldn't think so!

3 The "investment" of "up to" £34M is in fact merely a redirection of resources. No new money is being put into the overall HMRC "pot"; as Homer says, this money is being taken from somewhere else in the organisation:

"I am reprioritising our resources to make this additional investment possible, without impacting our other core customer services."

Does anyone know where the money is being taken from?

Anyhoo, as to whether this is a genuine attempt to improve things (as opposed to a window dressing exercise) and indeed as to whether it really will work, only time will tell.

I guess by then Homer will have been promoted to another civil service department.

Here is the text of the press release in full:

"HMRC’s Chief Executive, Lin Homer, has announced the recruitment of up to 1,000 additional contact centre staff, to achieve a target of answering 90 per cent of all calls two years earlier than planned.

Mrs Homer has planned a £9 million additional investment this year and up to £25 million in 2013-14 to reach the call centre industry standard two years earlier than HMRC originally promised to Parliament’s Treasury Select Committee.

The decision to invest in extra staff was taken after close consultation with the Joint Initiative on HMRC Service Delivery (JIHSD), which involves professional bodies and tax charities.

While call centre performance has improved significantly, from 48 per cent of all attempts handled in 2010/11 to 74 per cent in 2011/12, HMRC and JIHSD agreed that more needed to be done to provide a better calls service to customers.

Lin Homer said:

“Our contact centres receive around 60 million phone calls a year and how well we operate this service is of huge importance to our customers.

“It is vital that when customers call us for help their call is answered – and in a reasonable time. The feedback we get is that the quality of the advice we give when people get through is good, but we haven’t been answering enough calls.

“Our target of achieving contact centre industry standards of 90 per cent of calls answered first time is the right target. But after hearing the views of customers, stakeholder bodies and our own staff, we have speeded up our timetable for achieving it.

“I believe that we should be providing this important level of customer service sooner, not later, and investment of up to £34 million will enable us to do this by the end of March 2013 and sustain service levels during the next two years, rather than wait until 2015 to achieve the target. It will also enable us to reduce call waiting times drastically.

“I am reprioritising our resources to make this additional investment possible, without impacting our other core customer services.

“We remain committed to offering more online services and other ways of serving customers, which will ultimately reduce their need to call us. But in the meantime, this investment will give customers what they deserve – a much more responsive HMRC.

“I am enormously grateful to our stakeholder partners for their constructive advice, guidance and support in helping us to prioritise this additional investment in contact centres.

“I also want to thank our staff who work hard to deliver a good service and this investment will help them deliver to the standard they want to achieve.”

Exchequer Secretary David Gauke MP said:

“Although there has been an improvement in contact centre performance over the last couple of years, too many callers have faced unacceptable delays in getting through. I welcome this announcement which should result in a much improved service.”

Paul Aplin, Institute of Chartered Accountants of England and Wales and a member of the Joint Initiative on HMRC Service Delivery said;

“Today’s announcement shows how effective the engagement between HMRC and the key stakeholders involved in this initiative has been. There is more to do but this is a really encouraging step forward.”

Notes for Editors
1. HMRC has 17 contact centres based across the UK, employing 8,500 staff, handling around 60 million calls a year.

2. In 2010/11, HMRC answered 48% of all call attempts, and 74 per cent in 2011/12. Performance levels fluctuate throughout the year as a result of surges in calls during peak periods – such as Self Assessment filing and Tax Credits renewals. The industry standard is to answer 90 per cent of all call attempts.

3. The Joint Initiative on HMRC Service Delivery involves the Institute of Chartered Accountants in England and Wales (ICAEW), the Chartered Institute of Taxation (CIOT), the Institute of Chartered Accountants of Scotland (ICAS), the Association of Chartered Certified Accountants (ACCA), the Association of Accounting Technicians (AAT), the Association of Taxation Technicians (ATT), the Low Incomes Tax Reform Group (LITRG), Tax Aid and Tax Help for Older People (TOP).

4. The Project was set up in September 2011 in response to the House of Commons Treasury Select Committee’s recommendation that HMRC should work closely with professional bodies, tax charities and businesses to improve the end to end experience of dealing with HMRC. Initiatives on which HMRC and JIHSD have worked together include:

A series of highly-successful visits to each others’ premises that helped both sides gain a better understanding of the issues from the others’ perspective

Working together on a series of improvements around post handling times, guidance on PAYE coding, and turnaround of repayment approvals. To the end of July, we have dealt with over 80% of PAYE/SA post within 15 working days compared to 67% for the whole of 2011/12.

Creating a single point of contact for bereaved PAYE and SA customers and improving services for bereaved customers.

Implementing a number of improvements around informing employers that their P35 end-of-year returns were late and subject to penalties.

Setting up an email pilot for 200 agents which has been well received.

Launching a postal tracker tool on the HMRC Website, enabling PAYE customers and agents to self-serve when a response can be expected."

Tax does have to be taxing.

Thursday 9 August 2012

Homer's Noble Purpose

My thanks to a loyal reader who dropped me a note about a recent hot seat question and answer session, in which Lin Homer was asked about tax avoidance.

The exchange, according to my loyal reader, went as follows:

"Q: Ian Barlow (the new lead HMRC non -executive director) has been reported in the press as saying:

'There is no meaningful distinction to be drawn between acceptable tax planning and unacceptable tax avoidance.'

Do you agree with this statement?

If not can you explain why a person holding such views has been appointed to a senior position in HMRC?

Edward Troup (the new Tax Assurance Commissioner) has written that:

'Taxation is legalised extortion'

In the same article he said that the judgement about whether to engage in tax avoidance or not was 'not immoral'.

Do you agree with these sentiments?

If not would you again explain why such a person could be appointed to a senior position in HMRC?

Lin Homer responded: The views that Ian Barlow expressed in the article were several years old, and in fact he was making the point that legally there is no distinction between acceptable tax planning and unacceptable tax avoidance.

In that sense, he was correct in what he wrote.

Since that time Ian has worked very closely and successfully with Dave Hartnett to bring tax as an issue to be discussed in the Boardrooms of major companies, making responsible tax policy a Board-level subject for debate and oversight. Edward Troup’s comments were also made in an old article.

The debate about the morality of tax avoidance is a live issue today, and I would prefer to regard paying all due taxes on time in terms of a noble purpose, rather than in terms of morality.

I think morality is an issue for theologians and politicians, rather than for civil servants.

The reason both Ian and Edward have been appointed to their new positions is because of the vast experience they bring in both tax and business, and this will be invaluable to HMRC."

Egad!

Paying all taxes is a "noble purpose"!

I would agree with her that the issue of "morality" is not for the civil service, but is instead an issue for theologians. However, I would most certainly not agree with her that morality is an issue for politicians.

I refer Homer to my article in June, in which I said:

"A politician lecturing us on morality is as natural as a cat walking on its hind legs."

May I make a suggestion that at future hot seat Q&A sessions, if appropriate, loyal readers from HMRC start quoting from this site and/or suggesting that Excom start to read this site (just to see what the reaction is).

You never know, they may learn something!

Tax does have to be taxing.

Wednesday 8 August 2012

HMRC's Telephone Service Standards

As loyal readers are only too well aware, HMRC's telephone service standards are often the cause of some robust discussions on this site (eg this post).

However, this is not the only site that vexes lyrical about HMRC's telephone service. The ICAEW Tax Faculty is also unimpressed, and was moved to publish a report at the end of July entitled "HMRC Telephone Service Standards".

The key points being:

Waiting times are still too long. HMRC needs to ensure that sufficient numbers of staff are available to take telephone calls.
Introductory messages and menus are too long and over-complicated.
More agent-only lines are needed.
Performance measures are required and should be published.
HMRC needs to do more to get things right first time in order to reduce the need for further telephone contact.
HMRC needs to make better use of IT to help it provide a more efficient service again reducing the need for telephone contact.

No surprises there then (given that the above issues have been repeatedly mentioned many times before on this site).

I wonder as to whether HMRC will take this on board and do something with it?

The ICAEW are hopeful, apparently.

For why?

They had meeting recently with Lin Homer:

"We and the other professional bodies had a recent meeting with Lin Homer, HMRC’s new Chief Executive. We discussed these matters and it was good to see that Lin was personally committed to improving performance in this area.

We shall see whether she is able to translate that commitment into action to bring about the improvements needed."

Problem solved!

Tax does have to be taxing.