HM Revenue & Customs ('HMRC) plans 'interventions'
Date of Issue: 06 July 2006
Graham Buckell, Director of Bates Weston's Tax Advisory Division, gives his comments on HMRC's latest "interventions".
"As taxpayers may recall, over the
past two years HMRC has been sending 'enabling' letters. These
were letters sent to certain tax payers suggesting they reviewed
their tax returns for possible errors, causing taxpayers considerable,
and in most cases unnecessary, concern."
"As a development from "enabling" letters and
in a pilot exercise starting this month, HMRC plans a number
of"interventions". HMRC intends to see if there are
quicker, less costly and more effective ways of working that
can benefit both the taxpayer and HMRC. As these "interventions"
are not formal enquiries at this stage, it is up to the individual
as to whether to cooperate or not. Some of the proposals seem
helpful, but at the same time incorporate potential dangers,
as some of them seem to risk by-passing the individuals accountants."
The proposed interventions are:
- A current business record-keeping
review: checking current records to make sure
they meet HMRC standards.
- A short risk review:
issuing a questionnaire to a business based on a risk profile
of a particular trade, industry, or behaviour grouping.
- Self audit:
letters or telephone calls requiring the taxpayer to consider
potential risks around specific entries on their return, make
any necessary adjustments and notify HMRC of the adjustments
made.
- Telephone contacts:
calling taxpayers to outline why HMRC consider that an error
has been made on their return.
- Correction challenge:
where HMRC hold "good quality information from
a reliable source," they will correct the return, advise
the taxpayer and ask for an explanation as to the incorrect
figure.
- Current health check:
approaching a target population where HMRC believes there
are risks of non compliance.
Graham stresses that :
"these "interventions" are part of a pilot scheme, and that there is no cause for concern. If you are contacted by HMRC regarding this pilot scheme, simply contact your tax advisor."
Graham Buckell MA (Cantab) FCA CTA joined Bates Weston, a leading
firm of business advisors and Chartered Accountants, in 2001.
With over 25 years experience in both corporate and personal tax,
Graham advises clients on all aspects of direct tax, including
advice relating to company sales, purchases and restructuring.
For further details, please contact:
Bridget Charlton, Marketing Manager
Email: bridgetc@batesweston.co.uk
or telephone 01332 365855
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