Oversight of HMRC

Their Lordships on the economic affairs committee have mounted the anti avoidance bandwagon, and have said that tax avoidance by multinational companies was too easily carried out and ‘this damages the economy and undermines trust in the tax system’.

As noted before, HMRC and the "evil" companies that seek to avoid tax have to operate within the legal framework created by Parliament. However, the committee have ignored that point and instead have opted to blame HMRC in a report entitled "Tackling Corporate Tax Avoidance in a Global Economy: Is A New Approach Needed?"

Public Finance quotes from the report:

"There needs to be better parliamentary oversight of HMRC, so that the public can be confident that tax deals it agrees with multinational companies are appropriate.

The committee is concerned that HMRC may not be assertive enough in these negotiations."

The solution proposed by the committee is for the formation of a joint committee of MPs and peers which could, if necessary, take evidence in private to avoid claims by HMRC that it could not be held to account over individual deals because of the confidentiality of companies’ tax negotiations.

That's all very well, if the evidence taken could be guaranteed not to leak. However, given that the committee would be made up of politicians, there is every likelihood that it would leak.

Committee chair Lord MacGregor also wants large firms to publish a summary of their tax returns ‘so the public and media and ensure they are paying their fair share’.

Define "fair share" in the context of our massively complex tax system which very few people (HMRC and tax professionals outwith HMRC) actually understand ?

The committee also urged HMRC to end its practice of using staff seconded from leading accountancy firms to help design taxes.

"The risks are two-fold: that those on secondment will not have any incentive to design robust, hard-to-avoid taxes, and that when they return to private practice they will be better placed to advise how to exploit loopholes.

We recommend that the Treasury and HMRC should be better resourced to design and implement taxes, without undue dependence on short-term professional advisers."

In other words the committee wants HMRC to operate within a bubble, avoiding any contact with the real world!

Regarding oversight, the most effective oversight is that of creating a Cabinet post with specific responsibility for HMRC (ie one where the buck truly stops) outwith the Treasury.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Increase In Complaints About HMRC

It seems that over the past year, complaints made by taxpayers (or is it "customers"?;)) to HMRC have increased dramatically.

One of the reasons for the “unprecedented” increase appears to be a surge in complaints about Pay As You Earn (PAYE); mainly relating to errors in tax codes issued between 2008 and 2010 that caused a large number of underpaid/overpaid taxes.

The Annual Report (year ended March 2013) by the Adjudicator’s Office (which handles complaints from dissatisfied "customers" who have already tried to complain to HMRC, the Valuation Office Agency or The Insolvency Service), when referring to HMRC, said (page 12):

"During 2012-13 we received 1331 new complaints about a range of taxation issues. This was an increase of 107% on 2011-12 and accounted for 52% of the total number of complaints received. We resolved 525, upholding 55% either partially or substantially. Our investigators mediated 15% of cases directly with customers and the department. A large number of the taxation cases reviewed related to PAYE and were considered under the provisions of HMRC’s Extra Statutory Concession A19 (ESC A19)."

In the summary the reports notes the following increases in complaints:

"The increase has all been from HM Revenue & Customs (HMRC) customers; including PAYE complaints up by 347% and Tax Credit complaints up by 59% on the numbers received in 2010-11."

Judy Clements, the adjudicator, said it has identified a number of areas at HMRC where there are “systemic failures”, resulting in poor complaints handling.

“Most notably it is disappointing that for the third year running I have seen a range of cases where specific customer needs have not been recognised or addressed. I am unable to establish whether complaint handlers are not recognising the customer need or feel they are not empowered to step outside of procedures and provide alternative support.”

She notes:

"I am disappointed at the number of complaints HMRC customers feel they need to refer to me in order to get resolution. My role should be to consider the difficult exceptions, not handle routine matters that are well within the capability of departmental staff to resolve successfully. At a time of austerity it is also important to note that the cost of dealing with customer dissatisfaction increases exponentially with every additional level of handling."

Wise words indeed!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Real Time Monitoring

AccountancyAge reports that HMRC is considering daily checks on firms offering aggressive tax avoidance schemes.

At the moment anyone establishing an avoidance scheme must notify HMRC under the Disclosure of Tax Avoidance Schemes (DOTAS) facility within five days of starting to market it to clients.

HMRC can combat schemes in tribunals, but until a verdict is reached advisers can continue to market their avoidance arrangements.

HMRC's plans to monitor accountants in real time will enable it to see the schemes as they are devised, and be blocked before they reach market should they be deemed too aggressive.

The proposals will go under consultation this week.

I wonder how that will work in practice, given HMRC's lack of resources?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

East Kilbride Fairy Liquid Ban

I would welcome comments from HMRC staff from East Kilbride wrt the ban on Fairy Liquid in the office there.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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 Ongoing Clusterfuck

Loyal readers with good memories may recall that I have written a couple of times before about a loyal reader who dropped me a note concerning HMRC changing her address details (without her permission), and sending her ex husband her tax credit summary for 2012/2013.

The saga continues, and she has sent me a chronological summation of the last 6 months for publication:

"For 6 months I have been battling with HMRC/DWP - here is the chronology of everything that has happened.
----------------------------------
9^thFebruary – XXXX District Council notified me that they had suspended my Housing Benefit Claim as they were notified I no longer lived at my current address. After further investigation they informed me that they had my ex husbands address on file. They were given this information by DWP apparently. I had to 'prove' I still lived at my current address.

17^thMay – Ex husband received my tax credit annual review to his address. I phoned HMRC who were unable to explain to me how this had happened. I wrote a letter of complaint and also put in a Subject Access Request.

22^ndMay – I receive a response from HRMC, with regards to my subject access request and acknowledgement of receipt of my letter.

4^thJune – Ex husband received my NHS Exemption Card to his address

19^thJune – I received a voicemail from XXXX District Council notifying me that they wished to speak to me about my Housing Benefit Claim. When I managed to get hold of them it turns out that they had been notified of an address change again (it turned out to be my ex's new address as he had recently moved again).

23^rdJune – Still no response from HMRC to my original letter (sent on25^th May) so I send a further letter of complaint detailing the further issues.

4^thJuly – Phoned to notify HMRC that my ex husband had yet again received my documents. It turns out his new address was on my file. I updated the address details back to mine and also notified them that my son would remain in full time education from September (thus they would need to update my Tax Credit claim and need to issue a new award notice). I also informed them that I have not yet received a tax credit award for the year.

I took the opportunity to phone Child Benefit to see what address they had on record for me and it turns out that they too had my ex husbands address.

08^thJuly – My ex husband received two more letters from HMRC, addressed to me

10^thJuly – Received documents related to my 'Subject Access Request'

15^thJuly – Received 2 separate copies of the HMRC response to my complaint letter (letters originally dated 28^th June). Letter apologised, gave a brief & generic response to my complaint and informed me that I would receive £100 compensation plus £10 expenses within 21 days.

16^thJuly – Received another (third copy) of HMRC response to my complaint letter

22^ndJuly – 21 days since the date of issue on the response to my complaint letter and as of yet no compensation money has been received.

25^thJuly – 4pm phoned the number provided by HMRC, regarding my complaint response and lack of compensation payment – the phone is answered but hangs up. I phone again, the call is answered by a gentleman who tells me he will transfer me to the right person....'the right' person answers but can't hear me so hangs up. Eventually they then ring me back and apologise as there is a problem with their phone!!

I enquire as to whether there is any further details as to why the address changes keep happening. The lady informs that it is connected to CSA. Seeing as I get no child support from my ex (and NEVER have) this does not add up and I don't feel this makes sense?

The lady looked on my records and can't see why the compensation has not yet reached my account either, they also do not have an answer as to why I have not yet received my tax credit award. The lady could see an award dated 1^st July, but she also notes that on 4^thJuly I called to update the fact my son was continuing in further education and for some reason an updated award notice has not yet been issued.

The lady later phoned me back and informed me that she was having to put through the changes again, as for some reason they had got 'stuck' on the system and wouldn't issue an award.

A further phonecall from the same lady some 10 minutes later revealed that the reason an award notice wasn't issued, was because the information was about a future change, so that would not take effect until 1^st September – then a new award notice would go out!"

Have other loyal readers experienced similar problems, or is this just a one off cock up?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Hartnett's £50K Holiday Bank

Richard Brooks has just tweeted the following:

"What would your boss say if you asked to cash in 70 days unused leave? Have £50k? So said HMRC to retiring D Hartnett"

Seemingly, being able to cash in such a large holiday bank is not within the rules for less elevated civil servants (I understand that the norm is about a week or so).

Comments and views welcome!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

RTI - Everything Is Wunderbar!

A few days ago HMRC published a report "The Real Time Information Pilot" that summarises the findings from HMRC's Real Time Information (RTI) pilot.

The conclusion is self congratulatory:

"It is clear that the success of the national roll out of reporting PAYE in real time so far is based on the solid foundations laid by the success of expanding the RTI pilot into live running."

This despite the fact that there are a number of issues that may not yet be fully addressed, eg:

• Duplicate employments
• Employer Payment Summary (EPS) - the issue is ongoing as there is a risk that, when automatic late payment penalties are implemented from April 2014, HMRC’s systems will create penalisable payment defaults in the absence of an EPS reporting adjustments to the employer’s liability. HMRC are monitoring how to support the employer community further to ensure EPS are filed promptly where necessary.
• Out of Sync Payments etc

Those issues aside, I could not help but chuckle to myself when reading the Strategic Lessons Learned which included the earth shattering observations that:

• A pilot is an excellent way of introducing large scale change
• Thorough consultation is indispensable.

Have these people never run IT implementations/systems upgrades before?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

NAO Blows Its Own Trumpet

In December 2012 the National Audit Office (NAO) published a report, Customer Service Performance, which noted that HMRC received 79M calls and answered 74% of them in 2011/12, exceeding a provisional target of 58%. However, as the NAO stated, HMRC didn't exactly have high aspirations:

"HMRC’s service targets are lower and cover fewer areas than those of other organisations."

However, despite these low aspirations, the service level was unsatisfactory; as could be seen from the headline figure approximately 20M calls went unanswered. Those who did manage to get through had to wait on average 282 seconds before being put through to an adviser.

Moving on to the present day, the NAO is now claiming some "glory" from the report in that the NAO claims that this report has resulted in an improvement in the way HMRC deals with its customers

The NAO impact statement says that HMRC now plans to answer 80% of calls within five minutes, introduce more online services and replace the expensive 0845 helplines with 03 numbers.

All very jolly no doubt, except that in March this year I wrote:

"HMRC's target of answering 80% of calls within five minutes is "unambitious and woefully inadequate", and would still leave 16 million people waiting longer than five minutes."

The NAO should be a little less keen to blow its own trumpet in the future, unless there is a genuinely impressive improvement in performance from one of its audited organisations.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

RTI Trouble Ahead?

As the RTI behemoth lumbers on there is a warning about how it will cope in the autumn when 16,000 of the UK's largest private companies switch over to it.

Kate Upcraft of ISIS Support Services says she is staggered that the Treasury has allowed HMRC to push ahead with plans to bring the biggest employers into the RTI set-up in the autumn, while problems within RTI remain to be fixed.

The Telegraph quotes her as claiming that HMRC are overstating tax receipts on a “massive scale as they are corrupting employer data....Two of my clients have been asked for sums around £1m for one tax month that is not due.”

Another of her clients has been forced to give one employee the task of monitoring RTI each week “as so much of RTI isn’t working”. Last week the firm received 99 tax codes from HMRC that “were all incorrect”.

Ms Upcraft said the user group had raised concerns about a wide range of issues over an 18-month period in meetings with HMRC, but many of these had been ignored.

HMRC have blamed duplication of records problems on payroll software “glitches”. However, as one software expert involved in discussions with HMRC said:

“In order to get the information they wanted they refashioned the whole of the payroll industry. It cost us a fortune. They defined what they were going to do before they talked to us."

What's the view from the front end (ie both from staff and taxpayers) as to how RTI is really working?

Will it be able to cope in the autumn?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

HMRC's Hodge Podge Limbo

Unsurprisingly the ongoing anti avoidance soundbite campaign being waged by the politicians, and broadcast by the media, has affected HMRC.

The Telegraph reports that HMRC has over 40,000 cases of what it defines as “aggressive” tax avoidance awaiting resolution.

The so called “Margaret Hodge effect” is causing delays in resolution, as HMRC is now shying away from negotiating settlements (ie taking a practical approach). HMRC has taken a harder line in response, eschewing settlement deals in favour of challenging tax avoidance at tribunals and in court.

Bob Robinson, a senior tax manager at Grant Thornton, said:

“There are clients out there who are commercially pragmatic and if they could reach an acceptable compromise with HMRC, they would ... do so. If [HMRC showed] flexibility, they’d be able to clear up that backlog.”

Frank Haskew, head of the Tax Faculty at the Institute of Chartered Accountants in England and Wales, said:

“Challenging people through tribunals is very expensive and time consuming. It wouldn’t surprise me if [the backlog gets worse]. At some stage I think HMRC will need to start reaching agreements with taxpayers.”

Suffice to say, this Hodge Podge limbo will worsen as the cases continue to pile up.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

HMRC Achievements 2012/13

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Phone Rage Index

One of the curses of the modern world is the automated phone menu used by private and public companies alike.

PleasePress1.com has analysed the amount of web traffic to web pages that offer shortcuts for particular organisations,  and has compiled an index of the most frustrating companies to call in the UK.

The Telegraph reports that HMRC ranks as the most frustrating organisation to call, with 38,253 page visits in the last month, and over 400 menu options across just six services. Ford Motor Company comes in second, followed by Lloyds TSB in third place.

Tax does have to be taxing.
Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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 Tax Gap

As per Laura Kuenssberg:

"HMRC says tax gap is 32 billion - nearly half lost from evasion and crime, 5bn lost thro avoidance."

Therefore the hullabaloo raised by dog whistle politicians and the media over the issue of tax avoidance starving the coffers of the Treasury is overdone, and the issue is not as material as they would have us believe.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Whatever Happened To Special Measures?

My thanks to a loyal reader who has raised a query about the progress, or otherwise, of the "special measures" that HMRC were meant to have been placed under a couple of years ago:

"Ken/fellow readers,

Can anyone respond with knowledge, as opposed to speculation wrt this query?

Has/is HMRC been subject to Cabinet Office/Government special measures, and if so what/when?

In April 2011 this site referred on more than 1 occasion to special measures."

A swift Google gave rise to no information, that leapt out of the screen.

Does anyone have any specific, verifiable, information regarding the "special measures" that they feel able to share on this site?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

RTI Not Over Budget!

A couple of weeks ago I wrote that The NAO report into HMRC’s 2012-2013 accounts noted that the cost of implementing RTI is £356.6M (£115M over budget).

HMRC has issued a rebuttal of sorts, blaming the high costs on an extended pilot of the system.

HMRC had initially intended to put a few hundred PAYE schemes through a six-month pilot, but decided later to include 60,000 on a year-long test-run of the system.

Payroll World quote Suzanne Newton, RTI programme director at HMRC, who explained to a select committee of MPs that in recognition of the significant change brought about by RTI HMRC needed to “invest well” to ensure a successful implementation.

“Our initial cost assumptions back in 2010 were based on delivering a rather different solution, but as we worked through and consulted with stakeholders what was put through the pilot, and ultimately into the national rollout, changed quite considerably.” 

In other words reality didn't match expectations/budget!

The good news is that “only in the highly unlikely event of a catastrophic incident which took out a whole data centre” would the RTI system be unable to continue its normal output.  

Hoozah!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

How Very Odd!

My compliments to my chum Elaine Clark for identifying and pointing out this "oddity" wrt the death of a company sometimes killing off the corporation tax debt when there is a communications snafu between Companies House and HMRC.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Tax Reference Number Delays

Members of Dundee city council’s licensing committee have been told that the average wait for some would-be taxi drivers to get their tax reference number sent out to them is more than six months.

The Courier reports that Kevin Gibb appeared before the committee to apply for a temporary licence to be granted.

An agent appearing for him told the committee that Mr Gibb was still waiting for his tax reference number from HMRC so he can get away from the Job Centre and on to a taxi training course after having first applied for it in January.

Quote:

“The tax people are just not very efficient. Mr Gibb has applied several times but they just won’t come up with it.

I had to send him to an accountant and get a letter from him to say we have sent in the documentation.

The problem is you can’t speak to anyone, you can’t go and meet anyone face-to-face and say ‘I need this’.

He’s told them over the phone that he needs the reference number to get his licence but they say you don’t.

The council has given him several temporary licences but if they want to be bad-minded about it they could stop issuing them and put the process into abeyance for six months. 

The tax people are a nightmare — they’re just totally incompetent.”

A spokesman for HMRC said:

“We can’t discuss individual cases. However, if Mr Gibb contacts us through the customer services helpline for newly self-employed (0845 915 4515) then one of our customer service operators will talk him through the process.”

Mr Gibb said the reference number had finally come through and he was clear to begin his new career.

He said:

“I was told this could be a good career, but I didn’t think it would start like this. It was very close to falling through because of the tax.” 

I would be interested in feedback from people as to whether this is a common occurrence, or merely a one off issue?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Don't Count Your Chickens

The trouble with the ongoing politicisation of tax (or rather the mechanisms involved in collecting tax) is that the politicians and media "professionals" involved in the spin are apt to "overspin" the issues and potential results etc.

Such appears to be the case with the "landmark" tax agreement between the UK and Switzerland, which Osborne heralded last year as:

"The largest tax evasion settlement in British history."

Fast forward to the present day and we see...cough... that it now looks set to raise much less revenue than expected, according to an update from the Swiss Bankers Association (SBA).

Osborne expected to raise £5BN over five years, of which £3.2BN of revenues expected this year have already been included in the government’s borrowing figures.

However, the SBA said in a report last week that it is possible that less than £900M would be directly transferred to the UK. The association said that first indications suggested there were fewer untaxed UK assets in Switzerland than had been previously assumed, largely because many clients have resident non-domiciled status.

As per Accountancylive:

"These clients are not liable to taxation in the UK and thus do not fall under the agreement. Furthermore, numerous UK clients have opted for voluntary disclosure."

However, HMRC are sticking to their guns...for the moment:

"The estimate for yield from the Swiss agreement took into account the likely balance between tax withheld by the banks and tax collected by HMRC directly from individual taxpayers following disclosure, as well as the taxpayers' tax status. 

More people have chosen to disclose their tax affairs to HMRC than expected, so the yield from this route is likely to be higher than anticipated. There is no reason to revise the overall yield estimate at this point."

This despite the fact that the Office for Budget Responsibility has previously described the anticipated yield from the Swiss tax deal as ‘highly uncertain’, because of the lack of information about the value of the assets held by Britons in Switzerland.

I dare say that by the time the results are in, everyone will have forgotten what Osborne had promised.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

HMRC Loses 60% of VAT Penalty Appeals

The Tax Assurance Commissioner's annual report indicates that 60% of HMRC's decisions in VAT penalty cases are cancelled upon appeal.

Of 30,345 cases, HMRC's decision was overturned in 18,317, 60%, in 2011/12. Of the remaining 12,028, some 9,785 HMRC penalties (32%) were upheld the remaining balance of decisions varied upon appeal.

Jason Collins head of tax of Pinsent Masons is quoted by AccountancyAge:

"HMRC is operating under a lot of pressure to increase its revenues across the board, but this pressure is particularly acute in VAT. The NAO report highlighted the huge difference between the VAT HMRC believes it should be collecting, and the amount it actually does receive.

The fact that HMRC loses 60% of the penalty cases that businesses appeal shows that it may have become over-aggressive in hunting for cases of VAT evasion, and is making errors in issuing penalties. HMRC is also too quick to say a taxpayer has been negligent when it gets things wrong.

Unfortunately, it seems that thousands of UK businesses have been forced to challenge unfair fines as a result."

A spokesman for HMRC said:

"Only a small proportion of the millions of decisions HMRC makes each year are challenged. The review and appeal system provides a quick and easy way to resolve disputes.

Where we change a decision it is often because our customer has given us new information: for example, a reasonable excuse for their tax return being late, or fresh evidence to support a claim."

It is unfortunate that fresh evidence/reasonable excuses only seem to come to light during the appeal, as this wastes the time a resources of both the taxpayer and HMRC.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

300,000 RTI No Show

Payroll World reports that 300,000 companies have failed to report Real Time Information (RTI) to HMRC, ie switch to RTI by the early June deadline.

As a result they have been sent letters by HMRC informing them of their legal requirement to have filed PAYE in real time from April 2013.
An HMRC spokesman said:

“We know that the vast majority of these 300,000 schemes do not have any employees. It’s really important that employers tell us if they haven’t paid anyone in the tax month. 

This is easy to do. All the information they need is on our website at www.hmrc.gov.uk/actnow. If a scheme is no longer needed employers should contact us so we can close it on our records.”

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Personal Details

In May I wrote about a loyal reader who dropped me a note concerning HMRC changing her address details (without her permission), and sending her ex husband her tax credit summary for 2012/2013.

She has sent me an update wrt the situation, which she has given me permission to publish, quite shockingly HMRC have managed to do exactly the same thing again:

"My ex husband has moved address....and as a result, yet again HMRC have sent him my tax credits documents. 

When is this nightmare going to end? 

Totally at the end of my tether with it now.

I've still not even received a response to my first letter and on 23/06 I wrote to them again as my NHS Exemption card was sent to my ex, then on 19/06 I received contact from my local housing benefit department to enquire whether I had moved. 

It turns out that they had been notified by HMRC that I had moved out of the area. After a bit of further probing I was able to determine that for the second time, they had been given my ex husband's address again. 

 I'm not sure how much more of this I can take."

Views and comments, as always, are welcome!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Muddled Records

My thanks, and commiserations, to a loyal reader who alerted me to the fact that he is trying to pay HMRC a little over £1K that HMRC claim is owed to them by his firm.

Unfortunately HMRC's telephone payment line people can't help, because there is no record on their system that any money is owed; and yet letters are still being sent demanding payment.

Any suggestions anyone?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

HMRC Pitches For Creative Agency

HMRC will tomorrow (Friday) hold a pitch, via the Government Procurement Scheme, to find a creative agency for its annual campaigns around self-assessment and tax credits.

The winning agency will also create adverts and campaigns for other causes that arise during the term of the contract.

Campaign reports that ten agencies on HMRC's new government creative solutions roster have been approached.

HMRC recently worked with M&C Saatchi, on tax credits campaigns, and WCRS, which it hired in May 2012 to work on a range of ad hoc projects.

WCRS claims that the "inner peace" campaign that it created for HMRC led to a record 9.6 million people sending in their tax return in on time, representing 92.9% of people eligible for self-assessment.

This is an ideal opportunity for those loyal readers with a creative bent to come up with their own campaign ideas for future HMRC campaigns. Please feel free to submit your ideas (openly or privately), and I will feature the best at some stage in the future.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

RTI Fails On Key Metrics

The National Audit Office (NAO) has found that the delivery of HMRC's real-time information (RTI) project is over-budget, not fully resilient, has not yet qualified for financial accreditation and may miss its roll-out targets.

No surprises there then!

The NAO report into HMRC’s 2012-2013 accounts noted that the cost of implementing RTI is £356.6M (£115M over budget).

Oddly HMRC has not budgeted for any extra costs from any new issues that may arise.

The report also notes that the timetable for implementation is “challenging”.

Bizarrely RTI went live without full financial accreditation.

For good measure HMRC has chosen to not develop RTI with full resiliency because of the cost implications and because the PAYE service could be operated in an emergency without RTI.

All in all a fine example of how not to manage a systems upgrade!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

VAT Debt Falls To £2.5BN

Economia reports that businesses owe HMRC around £2.5BN in unpaid VAT, this is down on last year's figure of £2.7BN.

This fall in debt comes about as HMRC has doubled its use of distraint (10,577 times in the year ending March 2012, up from 5,520 over the same period in 2011).

HMRC has also more than doubled its spend on external debt collectors to almost £13M, according to data provided by HMRC to financial provider Syscap.

In distraint cases HMRC staff visit a company's premises without warning to collect unpaid taxes. The company then has five days to pay before major assets such as cars and computers can be removed.

Philip White, CEO of Syscap, said that HMRC has become “increasingly draconian” in its approach, through fines and seizing assets.

Has HMRC become more draconian in its approach, or is it that companies have been "pushing the envelope" further wrt delaying payments etc?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"

Man-Marking

During a debate in the House of Commons last Thursday about HMRC David Gauke used a phrase that I have never heard in relation to tax collection, namely "man-marking".

He is quoted by The Register:

“I should explain that HMRC works, with regard to large businesses, by putting in place CRMs — customer relationship managers. Their role is essentially to man-mark the most complex and high-risk taxpayers. In recent years that approach has proved to be effective in getting money in.

HMRC secured £8bn of additional compliance yield from large businesses in 2012-13, and more than £23bn in the past three years. It is an approach that has been endorsed by the OECD.”

When asked by Margaret Hodge about why HMRC hadn’t launched any cases against internet companies such as Amazon and Google, Gauke cited the British variation of the "fifth" (ie taxpayer confidentiality) saying that there was “no way to know what action HMRC has taken with regard to individual companies”.

“One of the difficulties that HMRC has is that it is bound by taxpayer confidentiality. It cannot give a running commentary to this House on the action that it takes, but the numbers demonstrate that HMRC is effective in getting money in.

“What we do know is that it has got billions of pounds in additional yield as a consequence of the action that it takes with large businesses as a whole. With reference to HMRC’s performance across the board, additional yield is being achieved year after year, and this Government have provided resources to increase the yield on evasion and avoidance.”

He graciously admitted that HMRC can only pursue companies for tax that they actually owed under the law (as opposed to pursuing them for tax that they don't owe).

Who is responsible for passing the laws which HMRC and the companies they deal with have to follow?

That would be our elected representatives!


Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance 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 Solar Tax Investigation Insurance



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"