Chinese VAT Fiddle

CCH Daily reports that HMRC has raised an additional £3.5BN in the last year through inquiries into the under-payment of VAT by small businesses, according to research by tax investigation insurance company PfP which suggests this sector is coming under increasing scrutiny.

However, a loyal reader has sent me a link to a Radio 5 report about Chinese online traders who are allegedly evading VAT (possibly to the tune of around £2BN, if the report is to be believed).


Is HMRC chasing these people with the same veracity as it chases UK companies?

No.

For why?

The UK companies are low hanging fruit, and are easy target!

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"

MOD Accounts Qualified Six Years Running

As a wee epilogue to yesterday's announcement about the appointment of Jon Thompson (currently the Permanent Secretary of the Ministry of Defence) as CEO of HMRC and Accounting Officer, I draw your attention to the following extract from the REPORT OF THE COMPTROLLER AND AUDITOR GENERAL ON THE 2014-15 ACCOUNTS OF THE MINISTRY OF DEFENCE:

"I have qualified my opinion for a sixth year because the Department is likely to have omitted a material value of leased assets and associated liabilities from its Statement of Financial Position. 

I cannot quantify the impact of these omissions on the accounts with certainty because, as a result of its accounting policies, the Department has not maintained the records, or obtained the information required to do so...

Sir Amyas C E Morse 
Comptroller and Auditor General 
13 July 2015"

Just saying...

Hat tip to Kevin Reed for pointing this out to me.

Thompson: Very well respected departmental finance chief, though unable to prevent MOD's accounts being qualified :) https://t.co/yL1qwxojcC

— Kevin Reed (@Goonerreed) February 24, 2016

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"

Jon Thomspon To Be CEO of HMRC

Jon Thompson

The Prime Minister has appointed Edward Troup as Executive Chair and First Permanent Secretary at HMRC and Jon Thompson, currently Permanent Secretary at the Ministry of Defence, as HMRC’s Chief Executive and First Permanent Secretary. The appointments have been made with the approval of the Cabinet Secretary and the Chancellor of the Exchequer.

 

Edward, HMRC’s most senior tax expert, has been Tax Assurance Commissioner since 2012 and leads the Central Tax and Strategy Group. In his new role, which he takes up on 5 April, Edward will chair the HMRC Board, and be responsible for creating and overseeing the strategy of the department. He will be a First Permanent Secretary, will remain as a Commissioner for HM Revenue and Customs and will also attend ExCom. The arrangements for assuring large tax settlements in HMRC will be reviewed following Edward Troup’s appointment as Executive Chair.

 

Jon Thompson has been Permanent Secretary at the MOD since September 2012, after a career in finance in both the private and public sectors (see here for his biography). Jon will be a First Permanent Secretary, will chair ExCom and be responsible for the delivery of HMRC’s strategy, objectives and performance. He will also be HMRC’s Accounting Officer.

 

Cabinet Secretary, Sir Jeremy Heywood, said: “I would like to congratulate Edward and Jon on their appointments. Edward’s deep tax expertise and long experience in both HMRC and HM Treasury make him an excellent choice to lead the department through an important phase of change and amid unprecedented public interest in taxation. Jon’s experience of leading one of the biggest departments in government, coupled with his strong financial background, make him strongly placed to deliver HMRC’s ambitious transformation plans, large-scale operations and modern customer services.”

 

The Chancellor of the Exchequer, Rt Hon George Osborne MP, said: "These are exceptional appointments to HMRC. We have one of the country's pre-eminent tax experts and ‎an outstanding civil service leader with experience of transforming large organisations. Edward’s wealth of experience in tax and Jon’s operational and financial expertise, most recently as Permanent Secretary at the Ministry of Defence, will prove a huge asset to HMRC as it improves its customer service and continues its vital work to clamp down on tax avoidance and evasion.”

 

Edward added: “I am delighted to be appointed as Executive Chair. It has been a privilege to be Tax Assurance Commissioner over the past three years and I look forward to leading HMRC along the path of transformation that has been established and to working with Jon Thompson as the new Chief Executive in ensuring the delivery of the ambitious plan that we agreed with ministers in our Spending Review settlement in November.

 

“By 2020-21, HMRC will be a smaller, more highly-skilled, more efficient, more modern and digital organisation, bringing together tax, data and operational expertise in large regional centres. In doing this, we need to build on our reputation for professionalism and impartiality, to maintain the public confidence that is the cornerstone of our tax system.

 

“I will work closely with Jon and our other ExCom colleagues to ensure that we continue to meet our vital purpose of collecting the funds that pay for public services, helping the honest majority to get their tax right and making it hard for the dishonest minority to cheat the system.”

 

Jon Thompson said: “I am excited to be taking up the challenge of leading the delivery of the department that raises the revenues that pay for the nation’s public services. With 50 million individual and five million business customers, HMRC operates at a scale that few organisations can match. I have long been impressed by the professionalism, expertise and commitment that HMRC’s people show in serving the public and I look forward to joining at this important time in the department’s evolution.”

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 Manipulated Wikipedia

It appears that HMRC, contrary to their own self belief in their infallibility, are in fact fallible. Especially when they rely on Wikipedia to support their views.

Contractor Weekly reports that HMRC recently lost a First Tier Tax Tribunal case because of its over reliance on the Wikipedia definition of “electromechanical.”

The case of RJS Electronics Ltd v HMRC (February 2016) involved the classification of four switches for the purposes of customs duty. HMRC classified the switches as “push button switches” which attracts a duty of 2.3% whereas RJS contended they were “electromechanical snap-action switches” which attracts a duty of 0%.

In May 2014 HMRC’s Review Officer issued his decision based largely on the definition of “electromechanical” taken from Wikipedia and said, “there is little guidance on this type of product and the Wikipedia information is not altogether clear but all things considered I must…..uphold the decision.”

However, what HMRC didn't admit to was the fact that they used only a selected portion of the Wikipedia defitnion that suited them best.

RJS, during appeal, challenged the Review Officer’s reading of the Wikipedia definition saying, “the HMRC representative used Wikipedia to come to their decision, however they are taking the terms out of context……they have ignored [part of the definition] even though they have quoted it…..they have stated that their sources are not clear and have just chosen to read the outcome that suits HMRC best. It is very important that someone classifying electronic goods is not just reading some page on the internet but they have at least a minimal understanding of the electronic terms.”

A week before the Tribunal hearing HMRC asked for the hearing to be adjourned and that the parties be directed to appoint a single joint expert who would provide an authoritative opinion on the switches. Such an expert would have cost several thousands of pounds and even though the tax at stake was less than £1,000, HMRC justified their suggestion on the basis that it would help with future decisions. The Tribunal considered an expert witness’ costs to be disproportionate and both HMRC’s requests were dismissed.

The Tribunal found in favour of the taxpayer and pointed out that the Wikipedia and OED definitions were “not entirely consistent” and unreliable.

The lesson here is that HMRC manipulates sources and facts to best suit its own objectives.

Do not trust 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"

HMRC's Threatening Charter

Remember the tired old HMRC dog, that should have been put down years ago, aka The Taxpayers' Charter (HMRC use the "c" word and refer to it as a "Customer Charter")?

Well it still exists and, apparently, is being redrafted.

CCH Daily reports that HMRC commissioned Ipsos MORI to conduct research to test taxpayers’ understanding of a revised version of its Customer Charter.

There have been criticisms that the charter is aggressive and assumes that those reading it will have contravened the tax law, rather than simply checking out their expectations around HMRC service.

The key areas that were most contentious were around whether the revised Charter used consistent language and tone, or created more confusion for customers with its threatening language.

There was criticism of the changing nuances of the language. Certain words stood out as being very different in tone to others, such as the word ‘tough’ with people questioning the language in Right 6, ‘Be tough on people who bend or break the rules’. This was felt to be more informal than language used elsewhere.  One employer commented: ‘I find that a bit threatening. But maybe that’s what they want.’

There were some instances where the language was felt to be ambiguous. For example, some employers did not think Obligation 4 ,‘Keep accurate records and protect your information’ was as precise as they would like it to be. HMRC’s customer insight and knowledge team commented: ‘It made them (customers) question how long they needed to keep accurate records for and what exactly they needed to keep records of.’

The full results are available at HMRC Customer Views on the revised Customer Charter report


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 Is Infallible

As loyal readers know, HMRC considers itself to be much like the Pope - infallible.

This self belief in infallibility can best be demonstrated by the following example, as published in the Telegraph, concerning the estate of Sara Hancock's late grandfather and HMRC's refusal to admit that they had lost a final tax return submitted by the family's accountant.

The result being letters sent from HMRC demanding ever increasing automatic fines.

Now that the media are involved, HMRC has "graciously" waived the fines "as a gesture of goodwill". However, it still claims that it has not received the tax return.

Given that HMRC is infallible it is clearly, once again, the fault of the hapless taxpayer!

Here is the article in full:

When Sarah Hancock’s grandfather died after suffering from dementia, she thought she would help her grieving family get his affairs in order by calling HMRC’s "Tell Us Once" service, and telling them about his death. 

Little did she know that one phone call would lead to a nightmare year of letters demanding ever-increasing fines, which kept coming even when both Miss Hancock and her late grandfather's accountant wrote to the taxman explaining that he did not owe any tax. 

Frank Hancock died in December 2014, after an illness which had left him in hospital for over a year. He and his wife Joyce each took half the proceeds of a small delivery business, but Mr Hancock’s half was so low it was covered by the personal allowance and married couple’s allowance. 

His accountant, Thomas Shreeve, had continued to file returns on his behalf, and HMRC’s own tax calculations showed that he was actually due a small rebate. 

When he died, Miss Hancock called HMRC, and an automatic letter was sent out asking her to file a return for Mr Hancock’s outstanding tax. This had already been done, so the couple’s accountant returned the forms alongside a letter explaining that the return had already been filed, so the form was superfluous. 

Nevertheless, the form was sent again by HMRC in June – a full four months later – with a standard letter saying that it had not been filled in correctly. 

A month later Miss Hancock received another letter with a bill for £100, the first late filing penalty. By November, almost a year after her grandfather’s death, the penalty demands, sent in "daily penalty reminder" letters, had increased to over £300. 

By mid-December the penalty had doubled to £600, and in mid-January a demand for £1,200 was sent. This final letter was also the first time the family had been given an option to challenge the fine.
Miss Hancock said: “It’s been a complete nightmare for the last 12 months. I made one phone call and got put down as the point of contact, which is fine, but I don’t want to be dealing with all these fines.” 

An accountant and former HMRC inspector of taxes, Mr Shreeve, who is 96, said he had filed all the returns on time and helped the family pay several years of backdated tax on the business before Mr Hancock's illness. 

He said: “Everything was in order with the estate, but they have ignored every single letter that was sent to them.” 

At one point the family were told to pay the fine up-front and then appeal it retrospectively - something they did not want to do as they did not trust HMRC to listen to their appeals. 

When contacted by Telegraph Money HMRC said it would cancel all the penalties on Mr Hancock's estate as a gesture of goodwill - but insisted it had not received his return. However, a spokesman admitted the series of demands sent to the Hancocks did not deal with the situation appropriately.
The spokesman said: "We apologise to Miss Hancock. We have cancelled the penalty as a goodwill gesture and can confirm that Miss Hancock will not have to submit tax returns in future." 

Last year the taxman was given new powers to demand payments within 90 days from those suspected of abusing tax loopholes, and to compel them to pay upfront and appeal the decisions later.
Robin Williamson, technical director of the Low Incomes Tax Reform Group, which is trying to make the tax system simpler for people with low incomes, said the Hancocks' problems stemmed from a change in HMRC's approach to fines. 

"The automatic penalty regime was introduced in 2010. At the same time they separated the penalties for returns and the returns for late payment, so even if you owed no tax, you still got penalties for not submitting your return whereas previously if you had paid your tax or did not owe any that would be in your favour. 

"It was a deterrent but it also had the unwanted side-effect of bringing in a lot of often vulnerable people, elderly people, taxpayers who couldn't get to an adviser or didn't know how to handle the forms they were getting. When the right way to deal with it would have been some form of personal contact, what they get into is this maelstrom of letters. 


"It also results in a lot of uncollected penalties which just have to be written off at the end of the day. So it's a big problem and it doesn't solve the problem of people who are trying to avoid filing their returns. 

"It's expensive, and useless, because it doesn't solve the problem of the missing return," he said.

In a consultation document published last year HMRC said it would consider removing penalties where people don't actually owe any tax, as part of changes to the system of fines. These would not be implemented until the Finance Bill 2017, at the very earliest. 

Chartered accountant Peter Hollis, a senior member of accounting trade body the Institute of Chartered Accountants, who has expressed concerns about similar cases where lost returns have resulted in large fines for taxpayers, criticised HMRC for its hastiness to issue fines after technical glitches or mix-ups. 

He said: "This is the sort of thing that keeps happening. The Revenue would like to think that they deal with things quickly and compassionately and pick out mistakes, but they don't. It never ceases to amaze me the lack of compassion within the revenue and how hard they can be in dealing with people." 

He also warned that cases like this could get worse in future as HMRC is given powers to go into people's bank accounts to extract funds.

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 Staff Mull Strike Action

HMRC staff are reportedly considering industrial action over news that HMRC has issued nearly 150 redundancy notices since the November announcement about plans to shut down 137 of its 170 offices (affecting 60,000 staff) across the country by 2020-2021, as part of plans to digitise tax administration.

CCH Daily reports that PCS has stated that HMRC is refusing to redeploy those at risk to any office listed for closure in the coming years under the plans.

An HMRC spokesperson said:

"HMRC does everything possible to avoid compulsory redundancies but the reality is we no longer need the mass processing roles of the past as we move to more skilled and specialist roles.

We have been through a lengthy and rigorous process to deploy colleagues to other areas of work within HMRC and this work has been on-going since 2014. We have consulted with Departmental trade unions to make sure that we've considered all possible redeployment opportunities."

PCS are quoted:

"We are considering all our options, including industrial action, and will provide regular updates to members.

We called on HMRC chief executive Lin Homer to intervene to avoid what would the first compulsory redundancies in her department, but she has refused.

It is entirely unnecessary and inflammatory to tell these 150 staff there is no future for them in the civil service when staff are being recruited to do similar work.

This is not how reasonable employers behave and we will be considering all options, including industrial action."

Good luck to Homer's successor sorting this out!

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 Gamekeepers Turned Poachers

It seems that the ongoing restructuring and redundancies in HMRC have created a ‘glut of gamekeeper-turned-poacher' tax experts who pose a threat to the professional value of accountants.

That is the conclusion of research carried out by Warwick Business School and the University of Birmingham. The non startling conclusion of the research was that individuals who leave HMRC for the private sector are ideally placed to exploit new management reforms to help companies avoid tax and undermine the tax profession.

No surprises there!

The research, which looked at how the HMRC had been reformed from 2003 to 2012, found that although many HMRC employees embraced wide reforms and took on ‘hybrid' managerial roles, a number of experienced staff members jumped ship and turned towards the private sector.

Professor Graeme Currie of Warwick Business School said former HMRC employees could cause major problems to the tax department due to their "inside" knowledge.

He is quoted by AccountancyAge:

"These gamekeepers-turned-poachers could compound the impact of a policy shift because they are best placed to capitalise on any changes to the agency's focus. As former insiders they are 'canny customers'.

We also suggest that, as in the case of accountants, professional values of independence and public service in the tax profession may over time be eroded by the increasing movement of tax professionals from HMRC into more commercially-orientated corporate clients, at the same time as frontline interactions across the regulator-regulatee divide shape service."

All very well, but it is somewhat late in the day to sound the alarm bells over the revolving door, as that door has been revolving for many years!

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"

Meet The Taxman - Coming To a TV Screen Near You

In June last year I pondered on the fate of the Channel 4 documentary "Meet The Taxman".

My thanks to a loyal reader who wrote to me yesterday to advise that the three part series will indeed be shown, and is coming to our screens in due course (the pre publicity for the series will apparently be hitting our TVs in due course).

Seemingly my loyal reader's accountancy practice was featured in the series. I am advised that there are some interesting storylines and fascinating people in the series. The delay in screening is, apparently, down to the fact that a couple of tax cases (prosecutions) need to clear before the show can be aired.

Watch this space!

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"

Homer's Successor - Postwoman Paula

AccountancyAge speculates that Paula Vennells, current chief executive at the Post Office, may be Homer's successor as CEO of HMRC.

Vennells has been at the Post Office since 2007, and was appointed as CEO in 2012. She was, apparently, instrumental in its digital transformation.

Vennells also has experience working within the private sector. In November, she was appointed to the board of Morrisons for her renowned restructuring skills.

Maybe she is the frontrunner. However, shouldn't the job be publicly advertised first?

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"

Homer's Not a Tax Expert

Lin Homer, as per The Mail:

"I am not a tax expert"

'Nuff said!

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 Google PAC Laugh In

Brittin: "We set up our (Dublin) operation for business reasons, not tax reasons"...@CommonsPAC erupts with laughter.#googletax

— Fraser Simpson (@AccyAgeTax) February 11, 2016

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"

Fake HMRC Phone Numbers

Be warned, there are some scummy people who have set up fake HMRC phone lines that aim to make a profit on connecting the hapless caller to a real HMRC phone line.

As per Low Incomes Tax Reform Group:

"We have recently noticed an 0844 ‘HMRC helpline’ number being advertised on the internet, which is not a real HMRC helpline number. Calling it will get you through to HMRC – but possibly at an inflated price. We urge caution for anyone searching for HMRC numbers online and recommend once again that the Government consider introducing a kitemark to identify genuine Government websites and numbers."

It's bad enough ringing the right number, without having some scumbag putting himself in the middle and trying to make money out of a phone call.

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 Digital Roadmap

HMRC'S 2016 roadmap for making tax digital. @HMRCDigital #xerocon pic.twitter.com/YKMq0MlJXx

— Fraser Simpson (@AccyAgeTax) February 9, 2016

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 Pension Problems

As the state pension system moves to flat rate in April, National Insurance contributions will determine the level of pension received.

All perfectly normal and logical. However, there appear to be difference between the records held by HMRC and employers. As such, there is a risk that some pensioners will be over paid and others underpaid.

HMRC has claimed “no pensioners will lose out” due to faulty data supplied by their employers pension schemes.

A spokesperson for HMRC has told the FT Adviser that it is working closely with pension funds to make sure their records are completely up to date, while all pension providers should use the official checking service to make sure their members’ records are accurate.

“HMRC is offering a free reconciliation service to enable the schemes to match their records against HMRCs, based on employers’ PAYE returns. This service has been available for nearly two years and HMRC urges employers to register for it before the deadline of 5 April.

For individuals shortly reaching their state pension age there is a fast track service to ensure they get the correct pension.”

Let us see how this all ends up working out!

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 Servers NOT Hacked!

A report in the Sunday Times has suggested that HMRC has identified 17,000 attempts to claim almost £100m in bogus tax repayments.

In such instances, criminals used the log-in details and password after an individual filed their online tax return to alter the details and request a repayment to an account under their control.

However, fear not, HMRC are 100% certain that their servers have not been hacked!

As per CCH Daily an HMRC spokesperson said:

"Our online services have not been hacked and remain secure.

We take our obligations around protecting customer data extremely seriously and have systems in place to review suspicious activity and monitor access to accounts."

HMRC are of the view that any online tax frauds are down to taxpayer failures.

All very well and good, but organisations and their staff do get hacked eg; Sony, TalkTalk, the Director of the CIA to name but a few that spring to my cold addled brain!

HMRC would do well not to be so complacent.

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"

Odds On Lin Homer's Replacement

AccountancyAge and William Hill have produced a list of the latest odds on the potential candidates to replace Homer.

On that subject, has anyone seen the job advertised yet?

Edward Troup - 2/1

Our front-runner currently serves as HMRC's tax assurance commissioner and second permanent secretary so on paper looks like he has the credentials.
His job involves reporting directly to Lin Homer and is responsible for shaping tax policy and strategy. Before HMRC, Troup was a partner at international law firm Simmons and Simmons, so will have the legal know-how at his disposal if he's ever called into a PAC hearing if he gets the top job.

Jim Harra - 5/2

Harra has worked his way up the ranks at HMRC, beginning his career in the Inland Revenue as an inspector of taxes in 1984. In 2009, Harra was appointed director of corporation tax and VAT and has previously suggested that it's unrealistic to expect multinational firms to pay as much as other businesses, something which sparked outrage in the wake of Google's £130m "sweetheart payment" to the taxman.

He has a wide knowledge of tax issues, including tax avoidance and knows a lot about the inner workings of HMRC. Was inspector of taxes at the Inland Revenue (now known as HMRC since 2005) in 1984.

Andy Cole - 3/1

Director of specialist investigations at HMRC. He has overall responsibility for leading the response to HMRC's largest and most complex fraud and avoidance risks through civil means.

Margaret Hodge - 7/1

Former chair of the Public Accounts Committee and one of the chief critics of HMRC's failure to tackle tax avoidance.

Stephen Herring - 7/1

Head of taxation at the Institute of Directors' policy unit. Herring has specialised in taxation for over 30 years and, before joining the IoD in September 2013, was a partner in three global accounting firms (Grant Thornton, EY and BDO). He was appointed by the Exchequer secretary as one of the eight independent members of HM Treasury's Tax Professionals Forum.

Ian Powell - 12/1

Chairman and senior partner at Big Four accounting firm PwC, he is stepping down as PwC chairman later this year.

John Whiting - 12/1

Tax director of the Office of Tax simplification. Until 2013 he was the tax policy director of the CIoT; previously, he was a tax partner at PwC.

Steve Lewis - 500/1

Coffee shop owner from Crickhowell and star of The Town That Took on the Taxman, has his own campaign to become CEO of HMRC. When he spoke to Accountancy Age, he gave himself 1000/1 odds.

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 is Clueless

Kudos to HMRC for holding consultations events re "simpler tax payments" during the busiest time of the year for tax professionals.

So much for the "customer" ethos that HMRC claims to believe in!

As per AccountingWEB:

This is going to affect all businesses that pay tax under self assessment, including companies.

HMRC is consulting on simpler tax payments. Let’s be clear; “simpler” means more frequent payments, which are paid at a time closer to the period in which the income is received.

There are no firm proposals on exactly how many extra tax payments will be required, and when the new system will come into effect, as this is a first-stage discussion paper. There will be discussion events held around the country (see below), open to any accountants in practice and their business clients. You need to book a place at those events by email, and there may be more events arranged in February and early March.

Consultation events:

Date	Day	Location
29/01/2016	Friday	London
01/02/2016	Monday	Bristol
02/02/2016	Tuesday	Exeter
03/02/2016	Wednesday	Cardiff
04/02/2016	Thursday	Newcastle
05/02/2016	Friday	London
05/02/2016	Friday	Nottingham
08/02/2016	Monday	Manchester
08/02/2016	Monday	Belfast
09/02/2016	Tuesday	Leeds
10/02/2016	Wednesday	Glasgow
01/02/2016	Thursday	Edinburgh
12/02/2016	Friday	Birmingham
19/02/2016	Friday	London

When George Osborne announced the end of the tax return, the AccountingWEB community were quick to uncover the potential benefits for the government. Some predicted that real-time tax payments for the self-employed would be a bi-product of the proposed quarterly online reporting. And so it appears to be.

The discussion paper makes it clear that accelerated tax payments will apply to corporation tax, VAT and self-assessed income tax, including Class 4 NIC. Class 2 NIC is to be merged into class 4 sometime soon, according to a current consultation paper. It hints that where a business pays several taxes (e.g. CT and VAT), the payment dates for those taxes may be aligned.

That would mean quarterly payments for CT for all companies. This is a logical extension of quarterly reporting of business turnover and expenses, glossing over the need to make adjustments for accruals, prepayments and disallowable expenses.

Companies who already pay CT by quarterly instalments won’t be affected, as they already pay corporation tax within the accounting period in which the profits are made. Also, companies with profits of £20m or more will see their CT quarterly instalments advance by four months for accounting periods starting on and after 1 April 2017.

HMRC justifies the acceleration in tax payments as a way to reduce the burden on taxpayers, as (they argue) it will allow easier off-set of construction industry scheme deductions against other tax liabilities. HMRC also cites research that concludes small businesses would prefer to pay tax in smaller amounts more regularly. The “burden” of companies moving from making a single CT payment nine months after the year end, to quarterly payments starting within the accounting period would also be lifted. 

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 Overpaid Its Staff

I see that somehow or other, HMRC managed to overpay 134 of its staff last year by a total of £1.2M. Not, it would seem, a one off event.

A spokesperson for HMRC said that most overpaid salaries over the last financial year have now been repaid.

Quoted by economia:

“We take recovery of any overpaid salaries extremely seriously. The percentage overpaid is around 0.5% of our total salary costs.

We are continuously seeking to improve the accuracy of our payment and over the last five years the amount overpaid to employees has reduced over 20%.”

This appears to be an ongoing issue.

Does anyone know why HMRC can't get its payroll right?


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 Joy of Online Filing

yep - that is how HMRC design their systems. No logic at all. You have to guess which ones need a 0.00 https://t.co/YDeezgd9MJ

— Elaine Clark (@cheapaccounting) February 1, 2016

.@cheapaccounting Helped with a tax return. The online filing won't let you enter zeros in some fields & demands them for others. @GOVUK

— Secret Ledger (@secret_ledger) February 1, 2016

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"

Reasonable Excuses For Late Tax Return

Those of you who have missed the 31 January deadline for submitting their tax returns online, may be able to avoid a penalty if they have a "reasonable excuse".

HMRC lists the types of excuses that it deems to be "reasonable":

"You can appeal against some penalties if you have a reasonable excuse, eg for your return or payment being late.

What may count as a reasonable excuse

A reasonable excuse is normally something unexpected or outside your control that stopped you meeting a tax obligation, eg:

• your partner or another close relative died shortly before the tax return or payment deadline
• you had an unexpected stay in hospital that prevented you from dealing with your tax affairs
• you had a serious or life-threatening illness
• your computer or software failed just before or while you were preparing your online return
• service issues with HM Revenue and Customs (HMRC) online services
• a fire, flood or theft prevented you from completing your tax return
• postal delays that you couldn’t have predicted

You must try to send your return or payment as soon as possible after your reasonable excuse is resolved.

What won’t count as a reasonable excuse

The following won’t be accepted as a reasonable excuse:

• you relied on someone else to send your return and they didn’t
• your cheque bounced or payment failed because you didn’t have enough money
• you found the HMRC online system too difficult to use
• you didn’t get a reminder from HMRC

If you have a disability

If you have a disability and claim to have a reasonable excuse that prevented you from meeting a deadline, HMRC will consider whether you made a reasonable effort to meet your obligation on time."

You will observe that the dog eating your tax records is not deemed to be "reasonable".

Good luck to those who were tardy!

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"